Details of BIS Wassenaar Final Rule Changes (Categories 3-4)

The Bureau of Industry and Security has issued a final rule, effective May 20, 2011, which revises the Export Administration Regulations to implement the changes made to the Wassenaar Arrangement's¹ List of Dual Use Goods and Technologies maintained and agreed to by governments participating in the Wassenaar Arrangement’s December 2010 Plenary Meeting.

This is Part II of a multi-part series of summaries of the changes made to harmonize the Export Administration Regulations with the changes made to the Wassenaar List at the 2010 Plenary. Part II covers the changes made to various Export Control Classification Numbers (ECCNs) in Commodity Control List (CCL) Categories 3 and 4. See future issues for summaries of the remaining changes.

Category 3- Electronics

ECCN 3A001 is amended by

• Removing paragraph 3A001.a.4 from the License Exception CIV eligibility paragraph in the License Exceptions section, because 3A001.a.4 is removed by this rule.
• Removing and reserving paragraph 3A001.a.4 ‘‘Storage integrated circuits manufactured from a compound semiconductor,’’ because the circuits of concern are covered by 3A001.a.2.
• Adding the word ‘‘Converter’’ to ‘‘Analog-to-Digital,’’ adding capitalization, and adding the acronyms (ADC) and (DAC) to paragraph 3A001.a.5.
• Replacing ‘‘Analog-to-digital converters’’ with ‘‘ADCs’’ in 3A001.a.5.a and Note 2 of the technical note located after 3A001.a.5.b for consistency.
• Revising the output rate for Analog-to-Digital Converters (ADCs) in 3A001.a.5.a.2, a.5.a.3, a.5.a.4, and a.5.a.5 from ‘‘200 million words per second’’ to ‘‘300 million words per second,’’ ‘‘105 million words per second’’ to ‘‘200 million words per second,’’ ‘‘10 million words per second’’ to ‘‘125 million words per second,’’ and ‘‘2.5 million words per second’’ to ‘’20 million words per second,’’ respectively. (These revisions are made because the speeds and capabilities of digital signal processing have advanced significantly since the last revision to these control parameters.)
• The Technical Notes that appeared after paragraph 3A001.a.5.b are moved to after 3A001.a.5.a.5. In addition, this rule moves the last half of Technical Note 3 to Note 6 and moves Note 4 to Note 7, and adds new notes 4, 5, 8, and 9 to address aggregation of ADCs.
• Revising the parameters for Digital-to-Analog Converters (DAC) in 3A001.a.5.b to better describe the crucial benchmarks for evaluating DAC devices, as well as adding four new technical notes that include two new technical terms: ‘‘adjusted update rate’’ and ‘‘Spurious Free Dynamic Range’’ (SFDR).
• Revising the upper threshold of the frequency parameter from 6 GHz to 6.8 GHz for Microwave Monolithic Integrated Circuits (MMIC) power amplifiers in paragraphs 3A001.b.2.a and b.2.b, for discrete microwave transistors in paragraphs 3A001.b.3.a and b.3.b, for microwave solid state amplifiers and microwave assemblies/modules containing microwave solid state amplifiers in paragraphs 3A001.b.4.a and b.4.b, and for the technology for the development or production of MMIC power amplifiers in paragraphs 5E001.d.1 and d.2, because the prevalent bands for commercial satellite communications are 5.7 GHz to 6.7 GHz.
• Adding a new parameter to paragraphs 3A001.b.2.d and b.2.f that reads ‘‘and with an average output power greater than 0.1 nW’’ for MMICs to narrow the scope of controls.
• Removing and reserving Note 1 to 3A001.b.2 relating to broadcast satellite equipment, because this entry controls components, not equipment.
• Adding the words ‘‘product group’’ to Note 3 to 3A001.b.2 to clarify the text.
• Adding a new parameter to paragraphs 3A001.b.3.e that reads ‘‘and with an average output power greater than 0.1 nW’’ for discrete microwave transistors to narrow the scope of this control.
• Adding a new parameter to paragraphs 3A001.b.4.c and b.4.e that reads ‘‘and with an average output power greater than 0.1 nW’’ for microwave solid state amplifiers and microwave assemblies/modules containing microwave solid state amplifiers to narrow the scope of controls for these items.
• Removing and reserving Note 1 after 3A001.b.4.f.3 concerning broadcast satellite equipment, because 3A001 does not control equipment but components, in this case Microwave or Millimeter Wave Components. In addition, Note 1 is not necessary, because MMICs specially designed for satellite broadcast equipment are not controlled by Category 3 pursuant to Note 1 at the beginning of Category 3.
• Removing the phrase ‘‘from one selected frequency to another’’ from 3A001.b.11 because it is redundant with the term ‘‘frequency switching.’’

ECCN 3A002 is amended by:

• Revising the parameters for radiofrequency signal analyzers in paragraphs 3A002.c to revise control thresholds to more accurately differentiate between commercial/civilian applications and applications of strategic concern by changing the controls from frequency only to a combination of frequency and other parameters. This change includes the redesignation of 3A002.c.3 to c.4 and the addition of a new paragraph 3A002.c.3.
• Revising and rearranging the narrative in 3A002.c.1 to more clearly describe the radio-frequency signal analyzers.
• This rule introduces a new parameter, ‘‘Displayed Average Noise Level,’’ in 3A002.c.2. This control protects the applications (principally advanced radar) that are of national security concern. Specifically, this revision relaxes the controls in 3A002.c.2 by adding the additional control parameter, ‘‘Displayed Average Noise Level,’’ that applies to the current frequency parameter of between 43.5 and 70 GHz.
• Adding a new control in 3A002.c.3 for signal analyzers having a frequency exceeding 70 GHz.
• Revising the ‘‘real-time bandwidth’’ for ‘‘dynamic signal analyzers’’ from ‘‘500 kHz’’ to ‘‘40 MHz’’ in the newly designated paragraph 3A002.c.4 to respond to emerging communications standards and available test equipment as ‘‘dynamic signal analyzers’’ approach 40 MHz in bandwidth. There is growing application of ‘‘dynamic signal analyzers’’ with ‘‘real-time bandwidth’’ above 40 MHz bandwidth in military applications.
• Replacing the reference in the Note following 3A002.c.4 from ‘‘3A002.c.3’’ to ‘‘3A002.c.4’’ to harmonize it with the addition of paragraph 3A002.c.3.
• Revising paragraphs 3A002.d.1, d.2 and the introductory text to d.4 relating to frequency synthesized signal generators to revise control thresholds to more accurately differentiate between purely civilian applications and those of strategic concern. These revisions are being implemented by changing the entry from one solely based on frequency to a combination of frequency and other parameters, such as output power.
• Revising 3A002.d.3.e and adding d.3.f to clarify the frequency switching controls by defining switching times and windows within the range 43.5--70 GHz.
• Revising the introductory text for 3A002.d.4 to add an upper limit to the frequency switching control of 70 GHz.
• Removing an ‘‘or’’ at the end of paragraph 3A002.d.3.d and adding it to the end of paragraph 3A002.d.3.e, because of the addition of new paragraph d.3.f. An ‘‘or’’ is added at the end of paragraph 3A002.d.4.b, because of the addition of new paragraph 3A002.d.5. These controls protect the applications (principally advanced radar) that are of national security concern. Finally, the umbrella control on signal generators ‘‘> 70 GHz’’ is moved to new paragraph 3A002.d.5. Specifically, this revision relaxes the frequency threshold from the current value of 43.5 GHz to 70 GHz by clarifying that other control parameters apply between 43.5 and 70 GHz. This approach addresses emerging civilian telecommunications standards in the 56--67 GHz band by defining performance parameters.

ECCN 3A991 is amended by replacing the control level for Analog-to-Digital Converters (ADCs) in paragraph 3A991.c with the former control levels for ADCs in ECCN 3A001.a.5.a. Therefore, ADCs in 3A991.c.1 having a resolution of 8 bit or more, but less than 12 bit are amended by revising the output rate from ‘‘greater than 100 million words per second’’ to ‘‘greater than 200 million words per second.’’ ADCs in 3A991.c.2 having a resolution of 12 bit are amended by revising the output rate from ‘‘greater than 5 million words per second’’ to ‘‘greater than 105 million words per second.’’ ADCs in 3A991.c.3 having a resolution of more than 12 bit but equal to or less than 14 bit are amended by revising the output rate from ‘‘greater than 500 thousand words per second’’ to ‘‘greater than 10 million words per second.’’ ADCs in 3A991.c.4 having a resolution of more than 14 bit are amended by revising the output rate from ‘‘greater than 500 thousand words per second’’ to ‘‘greater than 2.5 million words per second.’’ These changes are made because of the technological advances in the field of ADCs and because raising the control level for ADCs destined to anti-terrorism countries will not pose a national security threat to the U.S.

Pursuant to the EAR, those ADCs that are now classified as EAR99 still require a license for export to Cuba, North Korea, and Syria, because a license is required for export of all items subject to the EAR to these countries. EAR99 ADCs destined to Iran and Sudan may require a license pursuant to the EAR if destined to a restricted end-user or end-use. (See General Prohibitions 4 through 10 in Part 736 of the EAR.) Also note that the Treasury Department’s Office of Foreign Assets Control (OFAC) administers comprehensive trade embargoes against Iran and Sudan, and exports or reexports of EAR99 ADCs to those countries are subject to OFAC’s regulations. See 31 CFR Part 538—the Sudanese Sanctions Regulations and 31 CFR Part 560—the Iranian Transactions Regulations.

ECCN 3B001 is amended by:

• Revising the critical dimension of semiconductor devices by plasma enhanced Chemical Vapor Deposition (CVD) equipment from ‘‘180 nm or less’’ to ‘‘65 nm or less’’ in paragraph 3B001.d.1 and d.2 to account for technical advances in the industry of semiconductor manufacturing.
• Capitalizing ‘‘Minimum Resolvable Feature’’ size and adding the acronym (MRF) in paragraph 3B001.f.1.b and in the technical note that follows.
• Revising the feature size from ‘‘180 nm’’ to ‘‘95 nm’’ for align and expose step and repeat (direct step on wafer) or step and scan (scanner) equipment in 3A001.f.1.b and for imprint lithography equipment in paragraph 3B001.f.2.
• Revising the K factor from ‘‘0.45’’ to ‘‘0.35’’ in the Technical Note following 3B001.f.1.b to align with advancing technology.

ECCN 3C001 is amended by removing the text in the Related Definitions paragraph of the List of Items Controlled section and adding in its place ‘‘N/A’’ to correct the Related Definitions paragraph.

ECCN 3E001 is amended by:

• Revising the parameter in paragraph (a) of Note 2 from ‘‘of 0.5 μm or more; and’’ to ‘‘at or above 0.130 μm,’’ to accommodate advances in technology and increasing civil application of that technology.
• Replacing the current text in paragraph (b) of Note 2 ‘‘Not incorporating multi-layer structures’’ with ‘‘Incorporating multi-layer structures with three or fewer metal layers’’ to expand the exclusion note.
• In addition, this rule removes the technical note in Note 2 of 3E001 because the note is no longer necessary due to the revision to paragraph (b) of Note 2.

Category 4 - Computers

ECCN 4A001 is amended by:

• Adding the phrase ‘‘or ‘‘civil aircraft’’ to the Note to 4A001.a.1, because some civil aircraft computers often reach the thresholds in 4A001.
• Revising the single event upset rate in 4A002.a.2.c from ‘‘1 × 10¥7’’ to ‘‘1 × 10¥8’’ because of advances in this technology. A Note is added to 4A001.a.2 to clarify that this provision does not apply to computers specially designed for ‘‘civil aircraft’’ applications to prevent this control from inadvertently capturing onboard civil aircraft computers.

Savings Clause

Shipments of items removed from license exception eligibility or eligibility for export without a license as a result of this regulatory action that were on dock for loading, on lighter, laden aboard an exporting carrier, or en route aboard a carrier to a port of export, on May 20, 2011, pursuant to actual orders for export to a foreign destination, may proceed to that destination under the previous license exception eligibility or without a license so long as they have been exported from the U.S. before July 19, 2011. Any such items not actually exported before midnight, on July 19, 2011 require a license in accordance with this regulation.

See future issues of ITT for additional details on the Wassenaar changes being implemented by BIS.

(See ITT’s Online Archives or 05/20/11 news, 11052022, BP summary announcing the publication of BIS’ final rule.

See ITT’s Online Archives or 05/23/11 news, 11052305, for BP summary of Part I of multi-part series of summaries.)

(BIS final rule, D/N 110124056-1119-01, FR Pub 05/20/11)