BIS Proposes Rule on Transfer of Certain USML Exports to CCL, Etc.

As part of the Administration’s Export Control Reform Initiative, the Bureau of Industry and Security has issued a proposed rule to, among other things, establish a framework for transferring certain items from the U.S. Munitions List to Commerce Control List, transfer an initial tranche of items on USML Category VII to the CCL, establish a process for making certain transferred items eligible for License Exception STA, establishing new definitions for “specially designed,” etc.

Written comments on BIS’ proposed rule are due by September 13, 2011.

(Since 2010, the Commerce and State Departments have been in the process of reviewing and revising the two primary lists of items controlled for export -- the Commerce Control List and the U.S. Munitions List -- in order to make the lists more “positive,” “aligned,” and “tiered.”)

New Regulatory Framework for Transferring Items on USML

In its rule, BIS is proposing a new regulatory construct for the transfer of items on the USML that, in accordance with section 38(f) of the Arms Export Control Act (AECA), the President determines no longer warrant control under the AECA and that would be controlled under the Export Administration Regulations (EAR) once the congressional notification requirements of section 38(f) and corresponding amendments to the International Traffic in Arms Regulations (ITAR) and its USML and the EAR and its CCL are completed.

Transfer of Initial Tranche of Items from USML Category VII Proposed

In addition to proposing a regulatory construct for transferring these items into the CCL, this rule proposes the transfer of an initial tranche of items from USML Category VII (Tanks and Military Vehicles) to the CCL.

Process for Making Certain Transferred Items Eligible for License Exception STA

This rule also proposes amending the EAR to establish a process by which certain items moving from the USML to the CCL would be made eligible for License Exception Strategic Trade Authorization (STA).

New Definitions for Specially Designed, End Items, Parts, Components

In addition, this rule proposes EAR amendments related to movement of USML items to the CCL, such as new definitions of relevant terms, including “specially designed,” “end items,” “parts,” and “components.”

Establishment of a New “Holding” ECCN Proposed

Finally, this notice proposes establishing a new holding Export Control Classification Number (ECCN) in which items that warrant a significant level of control, but are not otherwise classified on the CCL, may be temporarily placed.

See future issue of ITT for additional details on BIS' proposed rule.

⁽The Administration’s Export Control Reform Initiative is not the same as the Administration’s National Export Initiative, which is focused on doubling exports within the next five years.)

(See ITT’s Online Archives or 06/16/11 news, 11061613, for BP summary announcing expected July 2011 publication of BIS proposed rule on process for transitioning items from USML to CCL.

See ITT’s Online Archives or 06/14/11 news, 11061416, for BP summary on the status of BIS’ proposed rule.)

BIS contact -- Timothy Mooney (202) 482-2440

BIS proposed rule (D/N 110310188-1335-01, FR Pub 07/15/11)