Order Renewing Temporary Denial of Export Privileges; PJSC Aeroflot, 1 Arbat St., 119019, Moscow, Russia

Primary source

Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.

Published

September 28, 2023

Issuing agencies

Commerce DepartmentIndustry and Security Bureau

Full Text

<html>
<head>
<title>Federal Register, Volume 88 Issue 187 (Thursday, September 28, 2023)</title>
</head>
<body><pre>
[Federal Register Volume 88, Number 187 (Thursday, September 28, 2023)]
[Notices]
[Pages 66807-66810]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-21173]

-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

Bureau of Industry and Security

Order Renewing Temporary Denial of Export Privileges; PJSC
Aeroflot, 1 Arbat St., 119019, Moscow, Russia

Pursuant to section 766.24 of the Export Administration
Regulations, 15 CFR parts 730-774 (``EAR'' or ``the Regulations''),\1\
I hereby grant the request of the Office of Export Enforcement
(``OEE'') to renew the temporary denial order (``TDO'') issued

[[Page 66808]]

in this matter on March 29, 2023. I find that renewal of this order is
necessary in the public interest to prevent an imminent violation of
the Regulations and that renewal for an extended period is appropriate
because PJSC Aeroflot (``Aeroflot'') has engaged in a pattern of
repeated, ongoing and/or continuous apparent violations of the EAR.
---------------------------------------------------------------------------

\1\ On August 13, 2018, the President signed into law the John
S. McCain National Defense Authorization Act for Fiscal Year 2019,
which includes the Export Control Reform Act of 2018, 50 U.S.C.
4801-4852 (``ECRA''). While section 1766 of ECRA repeals the
provisions of the Export Administration Act, 50 U.S.C. App. 2401 et
seq. (``EAA''), (except for three sections which are inapplicable
here), section 1768 of ECRA provides, in pertinent part, that all
orders, rules, regulations, and other forms of administrative action
that were made or issued under the EAA, including as continued in
effect pursuant to the International Emergency Economic Powers Act,
50 U.S.C. 1701 et seq. (``IEEPA''), and were in effect as of ECRA's
date of enactment (August 13, 2018), shall continue in effect
according to their terms until modified, superseded, set aside, or
revoked through action undertaken pursuant to the authority provided
under ECRA. Moreover, section 1761(a)(5) of ECRA authorizes the
issuance of temporary denial orders. 50 U.S.C. 4820(a)(5).
---------------------------------------------------------------------------

I. Procedural History

On April 7, 2022, I signed an order denying Aeroflot's export
privileges for a period of 180 days on the ground that issuance of the
order was necessary in the public interest to prevent an imminent
violation of the Regulations. The order was issued ex parte pursuant to
section 766.24(a) of the Regulations and was effective upon
issuance.\2\ This temporary denial order was subsequently renewed in
accordance with section 766.24(d) of the Regulations.\3\ The renewal
order issued on October 3, 2022 and was effective upon issuance.\4\ A
second renewal order issued on March 29, 2023 and was also effective
upon issuance.\5\
---------------------------------------------------------------------------

\2\ The TDO was published in the Federal Register on April 12,
2022 (87 FR 21611).
\3\ At the time of the renewal, section 766.24(d) provided that
BIS may seek renewal of a temporary denial order for additional 180-
day renewal periods, if it believes that renewal is necessary in the
public interest to prevent an imminent violation.
\4\ The October 3, 2022 renewal order was published in the
Federal Register on October 7, 2022 (87 FR 60985).
\5\ The March 29, 2023 renewal order was published in the
Federal Register on April 3, 2023 (88 FR 19609).
---------------------------------------------------------------------------

On September 5, 2023, BIS, through OEE, submitted a written request
for renewal of the TDO that issued on March 29, 2023. The written
request was made more than 20 days before the TDO's scheduled
expiration and, given the temporary suspension of international mail
service to Russia, OEE has attempted to deliver a copy of the renewal
request to Aeroflot by alternative means in accordance with sections
766.5 and 766.24(d) of the Regulations. No opposition to the renewal of
the TDO has been received.

II. Renewal of the TDO

A. Legal Standard

Pursuant to section 766.24, BIS may issue an order temporarily
denying a respondent's export privileges upon a showing that the order
is necessary in the public interest to prevent an ``imminent
violation'' of the Regulations, or any order, license or authorization
issued thereunder. 15 CFR 766.24(b)(1) and 766.24(d). ``A violation may
be `imminent' either in time or degree of likelihood.'' 15 CFR
766.24(b)(3). BIS may show ``either that a violation is about to occur,
or that the general circumstances of the matter under investigation or
case under criminal or administrative charges demonstrate a likelihood
of future violations.'' Id. As to the likelihood of future violations,
BIS may show that the violation under investigation or charge ``is
significant, deliberate, covert and/or likely to occur again, rather
than technical or negligent[.]'' Id. A ``lack of information
establishing the precise time a violation may occur does not preclude a
finding that a violation is imminent, so long as there is sufficient
reason to believe the likelihood of a violation.'' Id.
If BIS believes that renewal of a denial order is necessary in the
public interest to prevent an imminent violation, it may file a written
request for renewal, with any modifications if appropriate. 15
CFR766.24(d)(1). The written request, which must be filed no later than
20 days prior to the TDO's expiration, should set forth the basis for
BIS's belief that renewal is necessary, including any additional or
changed circumstances. Id. ``In cases demonstrating a pattern of
repeated, ongoing and/or continuous apparent violations, BIS may
request the renewal of a temporary denial order for an additional
period not exceeding one year.'' \6\ Id.
---------------------------------------------------------------------------

\6\ 88 FR 59791 (Aug. 30, 2023).
---------------------------------------------------------------------------

B. The TDO and BIS's Request for Renewal

The U.S. Commerce Department, through BIS, responded to the Russian
Federation's (``Russia's'') further invasion of Ukraine by implementing
a sweeping series of stringent export controls that severely restrict
Russia's access to technologies and other items that it needs to
sustain its aggressive military capabilities. These controls primarily
target Russia's defense, aerospace, and maritime sectors and are
intended to cut off Russia's access to vital technological inputs,
atrophy key sectors of its industrial base, and undercut Russia's
strategic ambitions to exert influence on the world stage. Effective
February 24, 2022, BIS imposed expansive controls on aviation-related
(e.g., Commerce Control List Categories 7 and 9) items to Russia,
including a license requirement for the export, reexport or transfer
(in-country) to Russia of any aircraft or aircraft parts specified in
Export Control Classification Number (``ECCN'') 9A991 (section
746.8(a)(1) of the EAR).\7\ BIS will review any export or reexport
license applications for such items under a policy of denial. See
section 746.8(b). Effective March 2, 2022, BIS excluded any aircraft
registered in, owned, or controlled by, or under charter or lease by
Russia or a national of Russia from being eligible for license
exception Aircraft, Vessels, and Spacecraft (``AVS'') (section 740.15
of the EAR).\8\ Accordingly, any U.S.-origin aircraft or foreign
aircraft that includes more than 25% controlled U.S.-origin content,
and that is registered in, owned, or controlled by, or under charter or
lease by Russia or a national of Russia, is subject to a license
requirement before it can travel to Russia.
---------------------------------------------------------------------------

\7\ 87 FR 12226 (Mar. 3, 2022). Additionally, BIS published a
final rule effective April 8, 2022, which imposed licensing
requirements on items controlled on the Commerce Control List
(``CCL'') under Categories 0-2 that are destined for Russia or
Belarus. Accordingly, now all CCL items require export, reexport,
and transfer (in-country) licenses if destined for or within Russia
or Belarus. 87 FR 22130 (Apr. 14, 2022).
\8\ 87 FR 13048 (Mar. 8, 2022).
---------------------------------------------------------------------------

OEE's request for renewal for a period of one year is based upon
the facts underlying the issuance of the initial TDO, the renewal
orders subsequently issued in this matter, and evidence that continues
to develop during this investigation. These facts and evidence
demonstrate that Aeroflot has continued, and continues, to act in
blatant disregard for U.S. export controls and the terms of previously
issued TDOs. Specifically, the initial TDO, issued on April 7, 2022,
was based on evidence that Aeroflot engaged in conduct prohibited by
the Regulations by operating multiple aircraft subject to the EAR and
classified under ECCN 9A991.b on flights into Russia after March 2,
2022, from destinations including, but not limited to, Beijing, China,
Delhi, India, and Dubai, United Arab Emirates, without the required BIS
authorization.\9\ Further evidence submitted by BIS indicated that
Aeroflot was also continuing to operate aircraft subject to the EAR
domestically on flights within Russia, potentially in violation of
section 736.2(b)(10) of the Regulations.
---------------------------------------------------------------------------

\9\ Publicly available flight tracking information shows that on
March 6, 2022, serial number (SN) 65309 flew from Beijing, China to
Moscow, Russia, and SN 41690 flew from Dubai, UAE to Moscow, Russia.
In addition, on March 7, 2022, SN 63511 flew from Delhi, India to
Moscow, Russia.
---------------------------------------------------------------------------

As discussed in the October 3, 2022 and March 29, 2023 renewal
orders, evidence presented by BIS indicated that, after the renewal
orders issued, Aeroflot continued to operate aircraft subject to the
EAR and classified under ECCN 9A991.b on flights both into and within
Russia, in violation of the

[[Page 66809]]

Regulations and the TDO itself.\10\ Specifically, the October 3, 2022
renewal order detailed Aeroflot's continued operation of aircraft
subject to the EAR, including, but not limited to, on flights into and
out of Russia from/to Minsk, Belarus, Delhi, India, and Istanbul,
Turkey, as well as within Russia.\11\ Similarly, the March 29, 2023
renewal order detailed Aeroflot's continued operation of aircraft
subject to the EAR, including, but not limited to, on flights into and
out of Russia from/to Yerevan, Armenia, Shanghai, China, Bangkok,
Thailand, and Urgench, Uzebekistan, as well as domestically within
Russia.\12\
---------------------------------------------------------------------------

\10\ Engaging in conduct prohibited by a denial order violates
the Regulations. 15 CFR 764.2(a) and (k).
\11\ Publicly available flight tracking information shows that
SN 41690 flew from Istanbul, Turkey to Moscow, Russia on September
20, 2022 and from Delhi, India to Moscow, Russia on September 23,
2022. In addition, on September 1, 2022, SN 41214 flew from Minsk,
Belarus to Moscow, Russia. On September 13, 2022, SN 41214 flew from
Moscow, Russia to Sochi, Russia.
\12\ Publicly available flight tracking information shows that
SN 41214 flew from Yerevan, Armenia to Moscow, Russia on February
16, 2023 and from Urgench, Uzbekistan to Moscow, Russia on March 1,
2023. In addition, on March 2, 2023, SN 41214 flew from Moscow,
Russia to Sochi, Russia. On February 4, 2023, SN 41690 flew from
Bangkok, Thailand to Moscow, Russia. On March 5, 2023 and March 19,
2023, respectively, SNs 65309 and 41690 flew from Shanghai, China to
Moscow, Russia.
---------------------------------------------------------------------------

Since that time, Aeroflot has continued to engage in conduct
prohibited by the TDO and Regulations. In its September 5, 2023,
request for renewal of the TDO, BIS submitted evidence that Aeroflot
continues to operate aircraft subject to the EAR and classified under
ECCN 9A991.b, both on flights into and within Russia, in violation of
the March 29, 2023 TDO and/or the Regulations. Specifically, BIS's
evidence and related investigation demonstrates that Aeroflot has
continued to operate aircraft subject to the EAR, including, but not
limited to, on flights into and out of Russia from/to Yerevan, Armenia,
Beijing, China, Delhi, India, Male, Maldives, Istanbul, Turkey, Phuket,
Thailand, Dubai, Sharm el-Sheikh, Egypt, United Arab Emirates, and
Tashkent, Uzbekistan, as well as domestically within Russia.
Information about those flights includes, but is not limited to, the
following:

--------------------------------------------------------------------------------------------------------------------------------------------------------
Tail No. Serial No. Aircraft type Departure/arrival cities Dates
--------------------------------------------------------------------------------------------------------------------------------------------------------
RA-73126.............. 41214 737-8LJ (B738)............................ Yerevan, AM/Moscow, RU.. September 12, 2023.
RA-73126.............. 41214 737-8LJ (B738)............................ Moscow, RU/St. September 13, 2023.
Petersburg, RU.
RA-73126.............. 41214 737-8LJ (B738)............................ Istanbul, TR/St. September 13, 2023.
Petersburg, RU.
RA-73126.............. 41214 737-8LJ (B738)............................ Dubai, AE/Moscow, RU.... September 15, 2023.
RA-73126.............. 41214 737-8LJ (B738)............................ Yerevan, AM/Moscow, RU.. September 18, 2023.
RA-73126.............. 41214 737-8LJ (B738)............................ Istanbul, TR/Moscow, RU. September 19, 2023.
RA-73144.............. 41690 777-3M0 (ER) (B77W)....................... Beijing, CN/Moscow, RU.. August 7, 2023.
RA-73144.............. 41690 777-3M0 (ER) (B77W)....................... Moscow, RU/Vladivostok.. August 7, 2023.
RA-73144.............. 41690 777-3M0 (ER) (B77W)....................... Phuket, TH/Moscow, RU... August 12, 2023.
RA-73144.............. 41690 777-3M0 (ER) (B77W)....................... Moscow, RU/Vladivostok, August 13, 2023.
RU.
RA-73144.............. 41690 777-3M0 (ER) (B77W)....................... Phuket, TH/Khabarovsk, August 14, 2023.
RU.
RA-73144.............. 41690 777-3M0 (ER) (B77W)....................... Antalya, TR/Moscow, RU.. August 24, 2023.
RA-73144.............. 41690 777-3M0 (ER) (B77W)....................... Beijing, CN/Moscow, RU.. August 31, 2023.
RA-73144.............. 41690 777-3M0 (ER) (B77W)....................... Delhi, IN/Moscow, RU.... September 2, 2023.
RA-73146.............. 65309 777-300 (ER) (B77W)....................... Bangkok, TH/Moscow, RU.. September 3, 2023.
RA-73146.............. 65309 777-300 (ER) (B77W)....................... Moscow, RU/Vladivostok, September 6, 2023.
RU.
RA-73146.............. 65309 777-300 (ER) (B77W)....................... Shanghai, CN/Moscow, RU. September 11, 2023.
RA-73146.............. 65309 777-300 (ER) (B77W)....................... Male, MV/Moscow, RU..... September 13, 2023.
RA-73146.............. 65309 777-300 (ER) (B77W)....................... Moscow, RU/Vladivostok, September 16, 2023.
RU.
RA-73146.............. 65309 777-300 (ER) (B77W)....................... Vladivostok, RU/Moscow, September 17, 2023.
RU.
RA-73146.............. 65309 777-300 (ER) (B77W)....................... Shanghai, CN/Moscow, RU. September 18, 2023.
RA-73146.............. 65309 777-300 (ER) (B77W)....................... Delhi, IN/Moscow, RU.... September 19, 2023.
RA-73150.............. 65307 777-3M0 (ER) (B77W)....................... Hurghada, EG/Moscow, RU. August 12, 2023.
RA-73150.............. 65307 777-3M0 (ER) (B77W)....................... Sharm el-Sheikh, EG/ August 14, 2023.
Moscow, RU.
RA-73150.............. 65307 777-3M0 (ER) (B77W)....................... Hurghada, EG/Moscow, RU. September 5, 2023.
RA-73150.............. 65307 777-3M0 (ER) (B77W)....................... Moscow, RU/Vladivostok, September 6, 2023.
RU.
RA-73150.............. 65307 777-3M0 (ER) (B77W)....................... Tashkent, UZ/Moscow, RU. September 8, 2023.
RA-73150.............. 65307 777-3M0 (ER) (B77W)....................... Sharm el-Sheikh, EG/ September 13, 2023.
Moscow, RU.
RA-73150.............. 65307 777-3M0 (ER) (B77W)....................... Hurghada, EQ/Moscow, RU. September 14, 2023.
RA-73150.............. 65307 777-3M0 (ER) (B77W)....................... Antalya, TR/Moscow, RU.. September 17, 2023.
--------------------------------------------------------------------------------------------------------------------------------------------------------

III. Findings

Under the applicable standard set forth in section 766.24 of the
Regulations and my review of the entire record, I find that the
evidence presented by BIS convincingly demonstrates that Aeroflot has
acted in violation of the Regulations and the TDO; that such violations
have been significant, deliberate and covert; and that given the
foregoing and the nature of the matters under investigation, there is a
likelihood of imminent violations. Moreover, I find that renewal for an
extended period is appropriate because Aeroflot has engaged in a
pattern of repeated, ongoing and/or continuous apparent violations of
the EAR. Therefore, renewal of the TDO for one year is necessary in the
public interest to prevent imminent violation of the Regulations and to
give notice to companies and individuals in the United States and
abroad that they should avoid dealing with Aeroflot, in connection with
export and reexport transactions involving items subject to the
Regulations and in connection with any other activity subject to the
Regulations.

IV. Order

It is therefore ordered:
First, PJSC Aeroflot, 1 Arbat St., 119019, Moscow, Russia, when
acting for or on their behalf, any successors or assigns, agents, or
employees may not, directly or indirectly, participate in any way in
any transaction involving any commodity, software or technology
(hereinafter collectively referred to as ``item'') exported or to be
exported from the United States that is subject to the EAR, or in any
other activity subject to the EAR including, but not limited to:

[[Page 66810]]

A. Applying for, obtaining, or using any license (except directly
related to safety of flight), license exception, or export control
document;
B. Carrying on negotiations concerning, or ordering, buying,
receiving, using, selling, delivering, storing, disposing of,
forwarding, transporting, financing, or otherwise servicing in any way,
any transaction involving any item exported or to be exported from the
United States that is subject to the EAR except directly related to
safety of flight and authorized by BIS pursuant to section 764.3(a)(2)
of the Regulations, or engaging in any other activity subject to the
EAR except directly related to safety of flight and authorized by BIS
pursuant to section 764.3(a)(2) of the Regulations; or
C. Benefitting in any way from any transaction involving any item
exported or to be exported from the United States that is subject to
the EAR, or from any other activity subject to the EAR except directly
related to safety of flight and authorized by BIS pursuant to section
764.3(a)(2) of the Regulations.
Second, that no person may, directly or indirectly, do any of the
following:
A. Export, reexport, or transfer (in-country) to or on behalf of
Aeroflot any item subject to the EAR except directly related to safety
of flight and authorized by BIS pursuant to section 764.3(a)(2) of the
Regulations;
B. Take any action that facilitates the acquisition or attempted
acquisition by Aeroflot of the ownership, possession, or control of any
item subject to the EAR that has been or will be exported from the
United States, including financing or other support activities related
to a transaction whereby Aeroflot acquires or attempts to acquire such
ownership, possession or control except directly related to safety of
flight and authorized by BIS pursuant to section 764.3(a)(2) of the
Regulations;
C. Take any action to acquire from or to facilitate the acquisition
or attempted acquisition from Aeroflot of any item subject to the EAR
that has been exported from the United States except directly related
to safety of flight and authorized by BIS pursuant to section
764.3(a)(2) of the Regulations;
D. Obtain from Aeroflot in the United States any item subject to
the EAR with knowledge or reason to know that the item will be, or is
intended to be, exported from the United States except directly related
to safety of flight and authorized by BIS pursuant to section
764.3(a)(2) of the Regulations; or
E. Engage in any transaction to service any item subject to the EAR
that has been or will be exported from the United States and which is
owned, possessed or controlled by Aeroflot, or service any item, of
whatever origin, that is owned, possessed or controlled by Aeroflot if
such service involves the use of any item subject to the EAR that has
been or will be exported from the United States except directly related
to safety of flight and authorized by BIS pursuant to section
764.3(a)(2) of the Regulations. For purposes of this paragraph,
servicing means installation, maintenance, repair, modification, or
testing.
Third, that, after notice and opportunity for comment as provided
in section 766.23 of the EAR, any other person, firm, corporation, or
business organization related to Aeroflot by ownership, control,
position of responsibility, affiliation, or other connection in the
conduct of trade or business may also be made subject to the provisions
of this Order.
In accordance with the provisions of sections 766.24(e) of the EAR,
Aeroflot may, at any time, appeal this Order by filing a full written
statement in support of the appeal with the Office of the
Administrative Law Judge, U.S. Coast Guard ALJ Docketing Center, 40
South Gay Street, Baltimore, Maryland 21202-4022.
In accordance with the provisions of section 766.24(d) of the EAR,
BIS may seek renewal of this Order by filing a written request not
later than 20 days before the expiration date. A renewal request may be
opposed by Aeroflot as provided in section 766.24(d), by filing a
written submission with the Assistant Secretary of Commerce for Export
Enforcement, which must be received not later than seven days before
the expiration date of the Order.
A copy of this Order shall be provided to Aeroflot, and shall be
published in the Federal Register.
This Order is effective immediately and shall remain in effect for
one year.

Matthew S. Axelrod,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2023-21173 Filed 9-27-23; 8:45 am]
BILLING CODE 3510-DT-P

</pre></body>
</html>

View on FederalRegister.gov →Plain-text source

Indexed from Federal Register on September 28, 2023.

This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.