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US Export Controls U.S. Export Controls A Commerce Department Perspective EAR BOOT CAMP ECCN, EAR99 and the 600 Series Chicago, IL Oct 9, 2013 Gene Christiansen 202 482 2894 [email protected] Factors to be considered in determining if item is “subject to the EAR” • Jurisdiction – Characteristics of Item: • Nuclear---Energy, NRC, Commerce • Military---USML, Commerce • Destination Country – For Cuba, Iran, N Korea, N Sudan and Syria---OFAC • Public Domain technology and software What is covered under the Commerce Control List (CCL) • Everything not under the jurisdiction of another Agency or technical data that is not in the public domain. See part 734.3 – All items in the United States – All U.S. origin items wherever they are – Foreign made items that include in excess of de minimis value of controlled U.S. origin content. – Foreign made items that are the direct product of certain U.S. origin technical data or software. – Certain commodities produced by any plant located outside the U.S. that is the direct product of certain U.S. origin technical data or software Navigating the Commerce Control List (CCL) • The Commerce Control List – 10 categories • 0 Nuclear and miscellaneous • 1 Materials, chemicals, microorganisms, toxins • 2 Materials processing • 3 Electronics computers • 4 Computers • 5 Telecommunications and encryption • 6 Sensors • 7 Navigation and avionics • 8 Marine • 9 Propulsion systems and space vehicles Navigating the Commerce Control List • The Commerce Control List – 5 groups • A--- Equipment—end items • B--- Test and production equipment • C--- Materials • D--- Software • E--- Technology The Export Control Classification Number (ECCN) • All ECCNs use same • Reasons for Control format – 0 National Security— • 9A001 Wassenaar Arrangement • 9 Category – 1 Missile Technology – 2 Nuclear • A Group Nonproliferation • 0 Reason for Control – 3 Chemical & Biological • 01 sequential Weapons numbering – 9 Anti-terrorism, Crime Control, Regional Stability, Short Supply Order of Review to Determine authority to export • Is a License Required – Classify Item – ECCN gives reasons for control – 1--Country Chart matches reasons for control and country in matrix to provide license requirement – 2--Specific end use, end user license requirement— General Prohibitions 4 thru 10 – License exceptions can satisfy some license requirements for 1 above –If you satisfy the criteria, use the exception – If no requirement in 1 or 2 then No License Required (NLR) The Scope and Application of EAR99 • For dual use items – Items that are not elsewhere controlled on CCL • No EAR99 for items migrating from USML – Could be result of application of “specially designed” definition • If item is EAR99 See part 736.2 General Prohibitions 4-10. – Only controlled if going to a denied party, prohibited end-use/end-user, embargoed destination, or use by U.S. person in proliferation activities ECR Background • To implement the objectives, the Administration needed to: – Identify the specific sensitive and other items on a more positive USML that warrant individual license reviews even for ultimate end use by NATO and other regime allies; and – Amend the EAR and the CCL to control all formerly USML items that would no longer be on the revised USML so that they still could be controlled as military items, but in a more flexible way regarding such allies. ECR Background • The Departments of Commerce and State have published proposed or final rules on the following aspects of ECR: Framework : more “positive” USML and establishment of “600 series” structure Revised USML categories: will publish over 2013 proposed and final revisions to USML categories and corresponding “600 series” ECCNs “Specially Designed”: definition of the term for both the ITAR and EAR Transition/Implementation: grandfathering, changes to license exceptions and license structure • All changes in the jurisdictional status of items will need to comply with the congressional notification requirements of § 38(f) of the AECA. • Executive Order 13637 sets out the new delegations of authority for the administration of the new rules. • Final rules will have a six-month delay in implementation after publication (in addition to a two-year optional grandfathering period for existing USML authorizations.) 10 USML F-16 Systems/Components/Parts F-16 Specific USML Items Other Aircraft USML Items • Assembled engines • Aircraft wing folding systems, parts, and components • Weapons pylons • Tail hooks and arresting gear, and parts and components • Mission systems • Missile rails, weapon pylons, pylon-to launcher adapters, UAV • Bomb racks launching systems, and external stores support systems and parts and components • Missile launchers • Damage/failure-adaptive flight control systems • Fire control computer • Threat-adaptive autonomous flight control systems • Radar • Air-to-air refueling systems and hover-in-flight refueling (HIFR) • Radar warning receiver systems and parts and components • Radar jammer • UAV flight control systems and vehicle management systems • Laser/Missile warning system with swarming capability • Countermeasures dispensing system • Aerial refueling receptacle Illustrative list only • Helmet mounted displays/sights Reference Federal Register / Volume 76, No. 215 / Monday, November 7, 2011 / Proposed rules, page 68697 Commerce “600 Series” Systems/Components/Parts for the F-16 • Wings, Rudder, Fin, Panels • Engine inlets and ducting • Fuselage – forward, center, aft • Wing box • Cockpit structure • Flaperon • Forward equipment bay • Static structural members • Horizontal stabilizer • Exterior skins, fairings, radomes, access doors, leading edge flap • Conformal fuel tank • Landing gear • Cartridge Actuated Device, Propellant Actuated Device (CAD • Technology associated with above items / PAD) • Control surfaces, activation and control systems • Internal and exterior fuel tanks Illustrative list only Reference Federal Register / Volume 76, No. 215 / Monday, November 7, 2011 / Proposed rules, page 68689 “600 Series” “.y” Parts for F-16 Hydraulics Cockpit gauges and indicators Fuel lines Tires F-16 Specific .y Items Other Aircraft .y Items • Aircraft tires • Audio selector panels • Analog cockpit gauges and indicators • Check valves for hydraulic and pneumatic systems • Hydraulic System Filters • Crew rest equipment • Check valves • Ejection seat mounted survival aids • Hydraulic and Fuel hoses, Fittings, Clips, Couplings, Nut plates, • Energy dissipating pads for cargo (for pads made from paper or Brackets cardboard) • Cockpit mirrors • Filters and filter assemblies for hydraulic, oil, and fuel systems • Beacons • Steel brake wear pads (does not include sintered mix) • Urine collection systems • Propellers, propeller systems, and propeller blades used with • Cockpit panel knobs, Switches, Buttons, Dials reciprocating engines Illustrative list only Reference Federal Register / Volume 76, No. 215 / Monday, November 7, 2011 / Proposed rules, page 76081 ECR Order of Review (Supp. No. 4 to part 774) • Review the USML – Specifically enumerated items – “Catch-all” controls and ITAR definition of “specially designed” • If not on the USML, review the CCL – Review characteristics of item to determine applicable CCL category and product group – Review applicable 600 series ECCNs • Specifically enumerated items • “Catch-all” controls and EAR definition of “specially designed” – Review applicable non-600 series ECCNs 14 Determining Changes in Jurisdiction: 600 Series Framework Former USML items (and -018 items) 9A610 listed in the “Items” paragraph. CCL Order of review: • .a - .w: specifically enumerated Category end items, materials, parts, 0-9 Last two components, accessories, and characters will attachments Product generally track – Some items may be “specially the WAML designed” Group • .x: “specially designed” parts, A-E components, accessories, and attachments that are not specifically enumerated “600 series” derives its • .y: specifically enumerated parts, name from the 3rd components, accessories, and attachments that are “specially character of the ECCN designed” Authorization for Items Moving from USML to CCL: EAR Authorization 9A610 Military aircraft and related commodities. .a - .x items License Requirements controlled to all Reason for Control: NS, RS, MT, AT, UN countries except Control(s) Country chart Canada NS applies to entire entry except 9A610.u, NS Column 1 .v, .w, and .y RS applies to entire entry except 9A610.y RS Column 1 MT applies to 9A610.u, .v, and .w MT Column 1 AT applies to entire entry AT Column 1 .y items UN applies to entire entry except 9A610.y See § 746.1(b) for UN controls controlled to License Exceptions Country Group E:1 countries and LVS: $1500 GBS: N/A China (§ 744.21) CIV: N/A STA: (1) Paragraph (c)(1) of License Exception STA (§ 740.20(c)(1) of the EAR) may not be used for any item in 9A610.a (i.e., “end item” military aircraft), unless determined by BIS to be eligible for License Exception STA in accordance with § 740.20(g) (License Exception STA eligibility requests for “600 series” end items). (2) Paragraph (c)(2) of License Exception STA (§ 740.20(c)(2) of the EAR) may not be used for any item in 9A610. paragraph a-w paragraph x-y Authorization for Items Moving from USML to CCL: EAR License Exceptions 9A610 Military aircraft and related commodities. License Requirements Reason for Control: NS, RS, MT, AT, UN Control(s) Country chart NS applies to entire entry except 9A610.u, NS Column 1 .v, .w, and .y RS applies to entire entry except 9A610.y RS Column
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