OFAC Eases Export Restrictions on Personal Internet Services/Software for Iran , Sudan and Cuba
The Office of Foreign Assets Control has issued a final rule, effective March 8, 2010, amending the Sudanese Sanctions Regulations and the Iranian Transactions Regulations to provide a general license authorizing the exportation of certain services and software incident to the exchange of personal communications over the Internet.
Similarly, the final rule amends the Cuban Assets Control Regulations to provide a general license authorizing the exportation of certain services incident to the exchange of personal communications over the Internet.
By adding these authorizations, the Administration hopes to encourage the exchange of personal communications over the Internet by persons in Sudan, Iran, and Cuba.
Iran & Sudan: Service/Software Exports Incident to Personal Internet Exchanges
The final rule amends OFAC's Sudanese Sanctions Regulations and Iranian Transactions Regulations by adding new paragraphs that provide a general license authorizing the following transactions, provided certain conditions are met:
Service exports incident to personal Internet exchanges. The exportation from the U.S. or by U.S. persons, wherever located, to persons in Sudan (or to persons in Iran) of services incident to the exchange of personal communications over the Internet (such as instant messaging, chat and email, social networking, sharing of photos and movies, web browsing, and blogging) are authorized, provided that such services are publicly available at no cost to the user.
Software exports necessary to enable such services. The exportation from the U.S. or by U.S. persons, wherever located, to persons in Sudan (or to persons in Iran) of software necessary to enable the services described above is authorized, provided that such software is: (i) classified as "EAR99" under the Export Administration Regulations; (ii) is not subject to the EAR; or(iii) is classified by the Department of Commerce as mass market software under export control classification number (ECCN) 5D992 of the EAR; and(vi) that such software is publicly available at no cost to the user.
Prohibitions. The final rule does not authorize the direct or indirect exportation of: (i) services or software with knowledge or reason to know that such services or software are intended for the Government of Sudan (or the Government of Iran); (ii) any goods or technology listed on the Commerce Control List (15 CFR Part 774, Supplement No. 1), except for software necessary to enable the services described above that is classified by Commerce as mass market software under ECCN 5D992 of the EAR; (iii) Internet connectivity services or telecommunications transmission facilities (such as satellite links or dedicated lines); or (iv) web-hosting services that are for purposes other than personal communications (e.g., web-hosting services for commercial endeavors) or of domain name registration services.
Specific licenses may be issued for similar software, services. Specific licenses may be issued on a case-by-case basis for the exportation of other services and software incident to the sharing of information over the Internet, provided the software is: (i) classified as "EAR99;" (ii) not subject to the EAR; or (iii) is classified by Commerce as mass market software under ECCN 5D992 of the EAR.
Other agency licenses may be needed. The final rules does not relieve the exporter from compliance with the export license application requirements of other Federal agencies.
Cuba: Service Exports Incident to Personal Internet Exchanges
The final rule amends the Cuban Assets Control Regulations by adding a new paragraph that provides a general license authorizing the following transactions:
Service exports incident to personal Internet exchanges. The exportation from the U.S. or by persons subject to U.S. jurisdiction to persons in Cuba of services incident to the exchange of personal communications over the Internet (such as instant messaging, chat and email, social networking, sharing of photos and movies, web browsing, and blogging), are authorized, provided that such services are publicly available at no cost to the user.
Specific licenses may be issued for similar services. Specific licenses may be issued on a case-by-case basis for the exportation of other services incident to the sharing of information over the Internet.
Prohibitions. The final rule does not authorize the direct or indirect exportation of: (i) services with knowledge or reason to know that such services are intended for a prohibited official of the Government of Cuba or a prohibited member of the Cuban Communist Party; (ii) Internet connectivity services or telecommunications transmission facilities1 (such as satellite links or dedicated lines); (iii) web-hosting services that are for purposes other than personal communications (e.g., web-hosting services for commercial endeavors) or of domain name registration services; or (i) any items to Cuba.2
1For general licenses related to the provision of telecommunications services between the U.S. and Cuba and contracts for telecommunications services provided to particular individuals in Cuba, see 31 CFR 515.542(b) and (c), respectively. For a general license and a statement of specific licensing policy related to the establishment of telecommunications facilities linking the U.S. or third countries and Cuba, see 31 CFR 515.542(d).
2For the rules related to transactions ordinarily incident to the exportation or reexportation of items, including software, to Cuba, see 31 CFR 515.533 and 515.559.
(See ITT's Online Archives or 09/08/09 news, 09090830, for BP summary of BIS and OFAC easing restrictions on trade with Cuba for certain telecommunications, agricultural, and medical device transactions.
See ITT's Online Archives or 11/24/09 news, 09112420, for BP summary of OFAC clarifying its policy for issuing one-year licenses for agricultural and medical exports to Sudan and Iran.
See ITT's Online Archives or 10/14/09 news, 09101425, for BP summary of GAO reviewing possible actions to ease, suspend, or end the Cuba sanctions.)
OFAC final rule (FR Pub 03/10/10) available at http://www.federalregister.gov/OFRUpload/OFRData/2010-05023_PI.pdf
Treasury Dept. press release (dated 03/08/10) available at http://www.treas.gov/press/releases/tg577.htm