BIS Final Rule Revises CCL, Adds/Expands Unilateral U.S. Controls, Etc. to Conform to Wassenaar Changes (Part VII)

The Bureau of Industry and Security (BIS) has issued a final rule, effective September 7, 2006, which amends the Export Administration Regulations (EAR) at 15 CFR Parts 740, 743, 772, and 774 to implement changes made to the Wassenaar Arrangement's List of Dual-Use Goods and Technologies (Wassenaar List), and Statements of Understanding maintained and agreed to by the governments participating in the Wassenaar Arrangement.

Specifically, this final rule revises certain entries on the Commerce Control List (CCL) that are controlled for national security reasons in Categories 1, 2, 3, 5 Part I (Telecommunications), 5 Part II (Information Security), 6, 8, and 9, and definitions to conform with changes in the Wassenaar List.

This is Part VII of a multi-part series of summaries on this BIS final rule. Part VII focuses on the amendments affecting CCL Category 8 (Marine) and CCL Category 9 (Propulsion Systems, Space Vehicles and Related Equipment). See future issues of ITT for additional summaries.

Amendments to Category 8 - Marine

ECCN 8A002. BIS' final rule amends Export Control Classification Number (ECCN) 8A002 by adding a decontrol note in 8A002.f for digital cameras specially designed for consumer purposes, other than those employing electronic image multiplication techniques. This note was added because of the foreign availability of digital cameras.

Amendments to Category 9 - Propulsion Systems, Space Vehicles and Related Equipment

ECCN 9A001. The final rule amends ECCN 9A001 by:

(a) Revising the "unit" paragraph in the List of Items Controlled section to read "number" instead of "Equipment in number; parts and accessories in $ value."

(b) Revising paragraph 2 in the Note to 9A001.a, because it was discovered that the International Civil Aviation Organization (ICAO) issues a document equivalent to a civil Type Certificate that the participating members of Wassenaar found acceptable for export control purposes. Reference to that document has been added to paragraph 2.a within the Note to 9A001.a. The approval of the design of certain types of aircraft, engines and propellers is signified by the issue of a Type Certificate. In general there will be a Type Certificate Data Sheet (TCDS) associated with each Type Certificate issued. The TCDS records the basis of certification, the designation of each approved variant and general information concerning the design.

ECCN 9A012. The final rule amends ECCN 9A012 by:

(a) Revising the heading to add double quotes around the term "unmanned aerial vehicles" to indicate that this is a term now defined in 15 CFR Part 772. Also, adding the abbreviation "UAV" to the heading.

(b) Revising the heading to add associated systems, equipment, and components, because Wassenaar has agreed to expand this ECCN entry. It was determined that it would be prudent for the control of conventional arms to place export controls on the associated systems, equipment, and components used for remote controlling or guidance of the UAV or to convert a manned aircraft to an UAV.

(c) Revising the Related Controls paragraph of the List of Items Controlled section to add a reference to section 744.3 "Restrictions on Certain Rocket Systems (including ballistic missile systems and space launch vehicles and sounding rockets) and Unmanned Air Vehicles (including cruise missile systems, target drones and reconnaissance drones) End-Uses."

(d) Redesignating paragraphs 9A012.a and 9A012.b as 9A012.a.1 and 9A012.a.2.

(e) Adding a new paragraph 9A012.b for associated systems, equipment and components.

BIS notes that elated software for the development and production of equipment controlled under ECCN 9A012 is controlled for national security reasons (NS:1) and antiterrorism reasons (AT:1) under ECCN 9D001 and 9D002 respectively; software specially designed or modified for the "use" of full authority digital electronic engine controls (FADEC) for propulsion systems controlled by 9A012 is controlled for antiterrorism reasons (AT:1) under ECCN 9D003; and related technology for the development of this equipment is controlled for national security reasons (NS:1) and antiterrorism reasons (AT:1) under ECCN 9E001.

ECCN 9B010. The final rule adds ECCN 9B010 to control "equipment specially designed for the production of "UAVs" and associated systems, equipment and components controlled by 9A012." BIS states that the Participating States of the Wassenaar Arrangement agreed to control equipment, software and technology for the conversion of aircraft for UAV operation, because of attempts by countries of concern to acquire such conversion capability for conventional arms and terrorism purposes.

BIS notes that equipment under 9B010 is controlled for national security reasons (NS:1) and antiterrorism reasons (AT:1); Related software for the development and production of this equipment is controlled for national security reasons (NS:1) and antiterrorism reasons (AT:1) under ECCN 9D001 and 9D002 respectively; software specially designed or modified for the "use" of full authority digital electronic engine controls (FADEC) for propulsion systems controlled by 9B010 is controlled for antiterrorism reasons (AT:1) under ECCN 9D003; and related technology for the development and production of this equipment is controlled for national security reasons (NS:1) and antiterrorism reasons (AT:1) under ECCN 9E001 and 9E002 respectively.

ECCNs 9D001 and 9D002. The final rule amends ECCNs 9D001 and 9D002 by revising the License Requirement section in each to add ECCN 9B010 to the NS paragraph.

ECCN 9D004. The final rule amends ECCN 9D004 by adding a new paragraph 9D004.e to control "software" specially designed or modified for the "use" of "UAVs" and associated systems, equipment and components controlled by 9A012.

ECCN 9E001. The final rule amends ECCN 9E001 by:

(a) Revising the heading to include 9A012; and

(b) Adding 9A012 and 9B010 to the NS paragraph in the License Requirement section.

ECCN 9E002. The final rule amends ECCN 9E002 by removing the License Requirement Note that refers to Wassenaar reporting requirements in 15 CFR 743.1, because this ECCN is not eligible for License Exceptions GBS, CIV, TSR, LVS, CTP, or GOV and therefore does not require Wassenaar reporting.

ECCN 9E003. The final rule amends ECCN 9E003 by revising 9E003.a.11 to remove the qualifiers, (i.e., "wide chord" and "without part-span support") so that "technology" "required" for the "development" or "production" of all types of hollow fan blades for gas turbine engines are controlled for NS:1, SI, and AT:1 reasons. The advantage of using this type of blade is weight saving, stress reduction and an element of foreign object damage protection.

(See ITT's Online Archives or 09/19/06, 09/21/06, 09/22/06, 09/25/06, 09/26/06, and 09/27/06 news, 06091915, 06092120, 06092230, 06092530, 06092625, and 06092730 for Parts I, II, III, IV, V, and VI of BP summary.)

BIS final rule (D/N 060807211-6211-01, FR Pub 09/07/06) available at http://a257.g.akamaitech.net/7/257/2422/01jan20061800/edocket.access.gpo.gov/2006/pdf/06-7385.pdf