Rule2024-01408
Implementation of Additional Sanctions Against Russia and Belarus Under the Export Administration Regulations (EAR) and Refinements to Existing Controls
Primary source
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Published
January 25, 2024
Effective
January 23, 2024
Issuing agencies
Commerce DepartmentIndustry and Security Bureau
Abstract
In response to the Russian Federation's (Russia's) ongoing aggression against Ukraine and Belarus's complicity in the invasion, the Department of Commerce is strengthening its existing sanctions under the Export Administration Regulations (EAR) against Russia and Belarus, including by expanding the scope of the EAR's Russian and Belarusian Industry Sector Sanctions and making certain changes to the licensing requirements that apply to the occupied Crimea region of Ukraine as well. Additionally, this rule revises recent restrictions targeting Iran's supply of Unmanned Aerial Vehicles to Russia. This rule also refines certain existing export controls on Russia and Belarus. The Department of Commerce is taking these actions to enhance the effectiveness of its controls on these countries and to better align them with those implemented by U.S. allies and partners.
Full Text
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<title>Federal Register, Volume 89 Issue 17 (Thursday, January 25, 2024)</title>
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[Federal Register Volume 89, Number 17 (Thursday, January 25, 2024)]
[Rules and Regulations]
[Pages 4804-4815]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-01408]
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
15 CFR Parts 734 and 746
[Docket No. 240119-0019]
RIN 0694-AJ48
Implementation of Additional Sanctions Against Russia and Belarus
Under the Export Administration Regulations (EAR) and Refinements to
Existing Controls
AGENCY: Bureau of Industry and Security, Department of Commerce.
ACTION: Final rule.
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SUMMARY: In response to the Russian Federation's (Russia's) ongoing
aggression against Ukraine and Belarus's complicity in the invasion,
the Department of Commerce is strengthening its existing sanctions
under the Export Administration Regulations (EAR) against Russia and
Belarus, including by expanding the scope of the EAR's Russian and
Belarusian Industry Sector Sanctions and making certain changes to the
licensing requirements that apply to the occupied Crimea region of
Ukraine as well. Additionally, this rule revises recent restrictions
targeting Iran's supply of Unmanned Aerial Vehicles to Russia. This
rule also refines certain existing export controls on Russia and
Belarus. The Department of Commerce is taking these actions to enhance
the effectiveness of its controls on these countries and to better
align them with those implemented by U.S. allies and partners.
DATES: This rule is effective on January 23, 2024.
FOR FURTHER INFORMATION CONTACT: For general questions on this final
rule, contact Eileen Albanese, Director, Office of National Security
and Technology Transfer Controls, Bureau of Industry and Security,
Department of Commerce, Phone: (202) 482-0092, Fax: (202) 482-482-3355,
Email: <a href="/cdn-cgi/l/email-protection#176567732557757e643973787439707861"><span class="__cf_email__" data-cfemail="562426326416343f257832393578313920">[email protected]</span></a>. For emails, include ``Russia, Belarus, and
Iran December 2023 export control measures'' in the subject line.
SUPPLEMENTARY INFORMATION:
I. Background
In response to Russia's February 2022 further invasion of Ukraine,
BIS imposed extensive sanctions on Russia under the Export
Administration Regulations (15 CFR parts 730 through 774) (EAR) as part
of the final rule ``Implementation of Sanctions Against Russia Under
the Export Administration Regulations (EAR)'' (the Russia Sanctions
Rule) (87 FR 12226, March 3, 2022). To address Belarus's complicity in
the invasion, BIS imposed similar sanctions on Belarus under the EAR in
a final rule, ``Implementation of Sanctions Against Belarus''
(``Belarus Sanctions Rule'') (87 FR 13048, March 6, 2022). During the
last two years, BIS has published a number of additional final rules
strengthening the export controls on Russia and Belarus, including
measures undertaken in coordination with U.S. allies and partners.
Most recently, BIS strengthened its existing sanctions under the
EAR against Russia and Belarus, including by expanding the scope of the
EAR's Russian and Belarusian Industry Sector Sanctions and by expanding
the foreign direct product rule that already applied to Russia and
Belarus to apply as well to the Crimea region of Ukraine, which has
been occupied by Russia since 2014 (88 FR 33422, May 22, 2023).
Additionally, that rule revised restrictions implemented in a February
2023 rule, ``Export Control Measures Under the Export Administration
Regulations (EAR) to Address Iranian Unmanned Aerial Vehicles (UAVs)
and Their Use by the Russian Federation,'' targeting Iran's supply of
Unmanned Aerial Vehicles (UAVs) to Russia and refined existing export
controls on Russia and Belarus (Iran UAV rule) (88 FR 12150, February
27, 2023). The Department of Commerce took these actions to enhance the
effectiveness of its controls on these countries and to better align
them with those implemented by U.S. allies and partners.
Taken together, these actions under the EAR reflect the U.S.
Government's position that Russia's invasion of Ukraine and Belarus's
complicity in the invasion, flagrantly violate international law, are
contrary to U.S. national security and foreign policy interests, and
undermine global order, peace, and security.
The export control measures in this final rule build upon the
policy objectives set forth in the earlier rules referenced above. The
adoption of these measures, undertaken in part to better align U.S.
controls with the stringent measures implemented by partners and
allies, will enhance the effectiveness of the multilateral sanctions on
Russia by further limiting Russia's access to items that enable its
military capabilities and to sources of revenue that could support
those capabilities. Additionally, the new or expanded controls
specified in this rule target Belarus as part of the U.S. response to
the country's complicity in
[[Page 4805]]
Russia's aggression, as well as Iran for its support of Russia.
II. Overview of New Controls
This rule revises the EAR to enhance and strengthen the existing
sanctions against Russia and Belarus by expanding the scope of the
Russian and Belarusian industry sector sanctions to better align them
with the controls that have been implemented by U.S. allies and
partners imposing substantially similar controls on Russia and Belarus,
including a control added on Iran pursuant to the Iran UAV rule, that
targeted Iran's supply of UAVs to Russia (88 FR 12150, February 27,
2023) (Iran UAVs rule). For similar policy reasons, this rule also
refines other controls on Russia and Belarus that were imposed in
response to Russia's February 2022 further invasion of Ukraine.
III. Amendments to the Export Administration Regulations (EAR)
This rule enhances and strengthens the sanctions that have been
implemented on Russia, Belarus, the occupied Crimea region of Ukraine,
and Iran under the EAR, as described under sections A and B below. The
regulatory revisions described under Section A. Imposition of new
export controls on Russia, Belarus, and Iran, including changes to
align controls with those imposed by U.S. allies and partners include:
<bullet> Expansion of Russian and Belarusian Industry Sector
Sanctions that apply to items listed in supplement no. 4 to part 746 to
add additional items to align with controls imposed by U.S. partners
and allies and to make other changes to render the EAR's controls
stronger, more effective, and easier to understand;
<bullet> Expansion of items that require a license under Sec.
746.7 when destined to Iran and under Sec. 746.8 when destined to
Russia or Belarus under supplement no. 7 to part 746 to add an
additional item to align with controls imposed by U.S. partners and
allies and to make other changes to render the EAR's controls stronger,
more effective, and easier to understand; and
<bullet> Eliminating the lowest-level military and spacecraft-
related items (i.e., .y items) from being eligible for de minimis
treatment when incorporated into foreign-made items for export from
abroad or reexport to Russia or Belarus.
A. Imposition of New Export Controls on Russia, Belarus, and Iran,
Including Changes To Align Controls With Those Imposed by U.S. Allies
and Partners
This rule expands the scope of the Russian and Belarusian Industry
Sector Sanctions (Sec. 746.5 of the EAR) by adding additional items to
supplement no. 4 to part 746 that will require a license under Sec.
746.5(a)(1)(ii), as described further below. This rule also adds an
additional item to supplement no. 7 to part 746 that will require a
license under Sec. 746.7 when destined to Iran and under Sec. 746.8
when destined to Russia or Belarus.
1. Expansion of Russian and Belarusian Industry Sector Sanctions by
adding additional items to supplement no. 4 to part 746 consistent with
the objective to undermine Russia's and Belarus's industrial bases and
align the EAR controls further with those imposed by U.S. partners and
allies.
This rule expands the list of items set forth in supplement no. 4
to part 746 (Russian and Belarusian Industry Sector Sanctions Pursuant
to Sec. 746.5(a)(1)(ii)). Specifically, this rule adds 94 additional
Harmonized Tariff Schedule (HTS)-6 Code entries to supplement no. 4;
consequently, these items will now require a license for export,
reexport to, or transfer within Russia or Belarus under Sec.
746.5(a)(1)(ii). Restrictions on these 94 groups of industrial items
are intended to further undermine the Russian and Belarusian industrial
bases and their ability to continue to support Russia's military
aggression in Ukraine. The items added include a variety of industrial
materials, items needed for manufacturing, and certain aircraft-related
items. The complete list of 94 new HTS-6 Codes this rule adds to
supplement no. 4 are identified in amendatory instruction 10.
In May 2023, BIS imposed controls on entire harmonized system
chapters 84, 85, and 90 in supplement no. 4 to part 746 of the EAR.
With this new rule, BIS will notably be controlling all of harmonized
system chapter 88 as well. Chapter 88 is focused on aircraft,
spacecraft, and parts thereof, and there is significant overlap between
items in this chapter and items classified in Category 9 of the
Commerce Control List (see, e.g., Export Control Classification Number
(ECCN) 9A991). However, BIS believes that adding controls to all of
chapter 88 will more closely align U.S. controls with those of U.S.
allies, who generally impose aviation controls on Russia through
reference to Chapter 88. This will also ensure that additional related
items not enumerated or otherwise specified on the Commerce Control
List are controlled for export, reexport, or transfer (in-country) to
or within Russia and Belarus. Through such comprehensive controls, BIS
intends to cut further off Russia's access to items of potential
military significance and expand the economic impact of controls that
will deny Russia additional resources it needs to continue waging war.
Consistent with the amendments made elsewhere by this rule, the proper
order of review for destination-based controls specific to Russia and
Belarus is to review Sec. 746.8 before reviewing controls imposed by
Sec. 746.5. Furthermore, consistent with the Order of Review described
in supplement no. 4 to part 774 of the EAR and Sec. 734.3(b)(1)(i),
defense articles on the United States Munitions List (USML) are subject
to the exclusive jurisdiction of another agency and are thus not
subject to the EAR. Accordingly, no USML defense articles are
controlled under the EAR for export, reexport, or transfer (in-country)
to or within Russia or Belarus based on Sec. 746.5, no matter their
tariff code classification. See the International Traffic in Arms
Regulations (ITAR) (22 CFR parts 120 through 130) for controls for USML
defense articles.
Items controlled through amendments made by this rule were
identified based on a review of public and non-public information
regarding which items Russia seeks to further its war against Ukraine,
an evaluation of areas in which U.S. trade has continued to provide an
economic benefit to Russia, and an assessment of how the United States
could better align with its allies and partners to degrade Russia's war
effort. BIS estimates these changes to supplement no. 4 to part 746
will result in an additional 25 license applications submitted to BIS
annually.
2. Expansion of items that require a license under Sec. 746.7 when
destined to Iran and under Sec. 746.8 when destined to Russia or
Belarus under supplement no. 7 to part 746 to align with controls
imposed by U.S. partners and allies and to make other changes to render
the EAR's controls stronger, more effective, and easier to understand.
In supplement no. 7 to part 746 (Items That Require a License Under
Sec. 746.6 When Destined to the Temporarily Occupied Crimea region of
Ukraine, Under Sec. 746.7 When Destined to Iran, and Under Sec. 746.8
When Destined to Russia or Belarus), this rule expands the list of
items that require a license by adding one additional HTS-6 Code entry
(852910) to supplement no. 7; consequently, items classified under this
HTS-6 entry will now require a license for export or reexport to Iran
under Sec. 746.7(a)(1)(ii) and to Russia and Belarus under Sec.
746.8(a)(2). The restrictions on these items are intended to further
undermine Iran's ability to support the Russian and Belarusian
industrial bases that have in turn provided support for Russia's
military
[[Page 4806]]
aggression in Ukraine. The items that fall under this entry include a
variety of antennas and antenna reflectors and parts thereof. BIS
estimates this change to supplement no. 7 to part 746 will result in an
additional five license applications submitted to BIS annually.
3. Prohibiting the use of de minimis for .y ``600 series'' and
9x515 items for Belarus and Russia.
This rule revises Sec. 734.4 (De minimis U.S. content) to expand
the scope of the paragraph (a)(6)(ii) restriction that specifies there
is no de minimis level for foreign-made items that incorporate U.S.-
origin 9x515 or ``600 series'' .y items when destined for a country
listed in Country Group E:1 or E:2 of supplement no. 1 to part 740 of
the EAR or for China. Specifically, this rule adds Belarus and Russia
to this paragraph so that there is no de minimis level for U.S.-origin
9x515 or ``600 series'' .y items destined for Belarus or Russia. Adding
Belarus and Russia to this restriction on the use of de minimis will
bring additional foreign-made military and spacecraft items within the
scope of the EAR and put additional pressure on Russia's military and
defense industrial base, as well as make it more difficult for foreign
suppliers to provide even low-level military and spacecraft items to
Belarus and Russia. While the license requirements under Sec.
746.8(a)(1) already apply to the export, reexport, or transfer (in-
country) to or within Russia or Belarus of these low-level military and
spacecraft items, eliminating the eligibility of these items for de
minimis treatment makes the EAR's Russia and Belarus controls stronger,
more far reaching, and more effective. BIS estimates this change to
Sec. 734.4 will result in an additional five license applications
submitted to BIS annually.
B. Corrections and Clarifications to Existing Controls on Russia and
Belarus
Some of the EAR's Russia and Belarus-related provisions discussed
above in Section A with respect to the additional controls being
imposed on Russia and Belarus are also discussed here because this rule
makes corrections and clarifications with respect to those provisions.
The regulatory revisions described under Section B. Corrections and
clarifications to existing controls on Russia and Belarus include:
<bullet> Addition of exclusion from license requirements under
Sec. 746.6 for exports, reexports, and transfers (in-country) related
to deployments by the Armed Forces of Ukraine to or within the
temporarily occupied Crimea region of Ukraine and covered regions of
Ukraine;
<bullet> Clarification that U.S.-origin controlled content that
meets the criteria in new Sec. 746.10(a)(3) is excluded from de
minimis calculations when identifying controlled U.S.-origin content to
harmonize with similar exclusions under Sec. Sec. 746.5 and 746.8;
<bullet> Clarification regarding which EAR section takes precedence
when determining licensing requirements that apply to items identified
in supplements no. 2, 4, or 5 to part 746 that are also classified in
an ECCN under Sec. Sec. 746.5, 746.8, and 746.10;
<bullet> Clarification that fasteners are excluded from the scope
of supplement nos. 2, 4, 5, and 7, but are subject to the license
requirements under Sec. 744.21 for Russia and Belarus, as well as any
other part 744 license requirement that applies to all items subject to
the EAR;
<bullet> Harmonization of License Exceptions available under
Sec. Sec. 746.5, 746.8, and 746.10, except as limited in the
introductory text of the respective paragraph (c);
<bullet> Clarification that ``medicines'' are excluded from the
scope of supplement no. 6 to part 746;
<bullet> Conforming change to adopt case-by-case license review
policy for applications related to the safety of flight under
Sec. Sec. 746.5 and 746.10 to conform with Sec. 746.8; and
<bullet> Clarification that the import restrictions on the
temporary import of firearms from Ukraine do not apply to firearms that
were previously exported, reexported, or transferred (in-country) under
a BIS license that are being temporarily returned to the United States
for repair and servicing.
BIS anticipates that the changes discussed in section B will not
result in the submission of any additional license applications to BIS.
1. Addition of exclusion from license requirements for deployments
by the Armed Forces of Ukraine to or within the temporarily occupied
Crimea region of Ukraine and covered regions of Ukraine.
In Sec. 746.6, this rule adds an exclusion from the license
requirements for exports, reexports, and transfers (in-country) to or
within the temporarily occupied Crimea region of Ukraine and covered
regions of Ukraine related to deployments made by the Armed Forces of
Ukraine. This exclusion is added to facilitate the operations of the
Armed Forces of Ukraine (AFU or ZSU) within the temporarily occupied
Crimea region of Ukraine and covered regions of Ukraine. This change is
intended to make their deployments more efficient and effective.
2. Clarification that U.S.-origin controlled content that meets the
criteria in new Sec. 746.10(a)(3) is also excluded from de minimis
calculations when identifying controlled U.S.-origin content to
harmonize with similar exclusions under Sec. Sec. 746.5 and 746.8.
In Sec. 746.10 (`Luxury goods' sanctions against Russia and
Belarus and Russian and Belarusian oligarchs and malign actors), this
rule adds a new paragraph (a)(3) (Exclusion from scope of U.S.-origin
controlled content under paragraphs (a)(1) and (2) of this section).
Currently, certain U.S.-origin EAR99 items are not considered U.S.
controlled content for purposes of the EAR's de minimis rules when
incorporated into foreign-made items reexported or exported from abroad
from countries listed in supplement no. 3 to part 746 of the EAR
(Countries Excluded from Certain License Requirements of Sec. Sec.
746.6, 746.7, and 746.8). These exclusions are currently found in
Sec. Sec. 746.5(a)(3) and 746.8(a)(5) of the EAR. This addition to
Sec. 746.10 clarifies that the same de minimis exclusion applies to
the luxury goods items identified in supplement no. 5 to part 746 of
the EAR.
As a conforming change to the clarification to Sec. 746.10, this
final rule revises supplement no. 2 to part 734 (Guidelines for De
Minimis Rules) by adding an appropriate cross-reference to the new
paragraph (a)(3).
3. Clarification regarding which section takes precedence for items
identified in supplements no. 2, 4, or 5 to part 746 that are also
classified in an ECCN.
This rule revises the introductory text in Sec. Sec. 746.5 and
746.10 and makes a conforming change to Sec. 746.8 to clarify how
exporters should treat items that are controlled to Russia or Belarus
by more than one section of the EAR. Specifically, in Sec. Sec. 746.5
and 746.10, this rule revises paragraph (a) introductory text to
establish an order of review for purposes of the license requirements,
license exceptions, and license review policies that apply to any item
that is both classified in an Export Control Classification Number
(ECCN) on the Commerce Control List (CCL) in supplement no. 1 to part
774, and identified in supplement no. 4, 5, or 6 to part 746. BIS has
imposed export controls on Russia and Belarus under three different
sections of the EAR, sometimes using different classification methods.
Under Sec. 746.5, BIS largely imposes controls on Russia using HTS-6
code (see supplement no. 4 to part 746 of the EAR) or description (see
supplement no. 6 to part 746 of the EAR). Under Sec. 746.10, BIS
imposes controls on Russia using HTS-6 codes (see supplement no. 5 to
part 746 of the EAR). However, under Sec. 746.8, BIS largely imposes
controls using ECCNs.
[[Page 4807]]
Since nearly all items classified under ECCNs also can be classified
under, for example, an HTS-6 code, there are some instances when an
item may require a license under Sec. 746.8 of the EAR, and under one
of the other sections that imposes controls on Russia and Belarus.
In Sec. 746.5, this rule adds two sentences to the end of the
paragraph (a) introductory text to clarify two points. First, that a
license is not required under Sec. 746.5(a)(1)(ii) or (iii) for any
item that is listed in supplement no. 4 or 6 and classified in an ECCN.
Second, that exporters, reexporters, and transferors should consult
Sec. 746.8 for license requirements, license exceptions, and license
review policies that apply to items classified under ECCNs. In this
way, this amendment clarifies that controls in Sec. 746.8 should be
reviewed before controls in Sec. 746.5. However, this rule does not
make any changes to Sec. 746.5(a)(1)(i), which imposes end-use
specific controls on items described in supplement no. 2 to part 746.
This is because that provision's end-use control applies more broadly
than the destination scope in Sec. 746.8, and that control continues
to apply even for items listed in supplement no. 2 to part 746 and
classified in an ECCN. For the same reason, in Sec. 746.10, this rule
revises the paragraph (a) introductory text to clarify two similar
points as in Sec. 746.5. First, that for purposes of Sec.
746.10(a)(1), this rule specifies that a license is not required for
any item that is listed in supplement no. 5 and classified in an ECCN.
Second, this rule adds a sentence to direct exporters, reexporters, and
transferors to see Sec. 746.8 for license requirements, license
exceptions, and license review policies for exports, reexports, and
transfers to or within Russia or Belarus for items classified under
ECCNs. This rule does not exclude any item that is listed in supplement
no. 5 and is classified in an ECCN from the scope of the license
requirements under Sec. 746.10(a)(2) because this is a worldwide end-
user license requirement, which has a much broader destination scope
than Sec. 746.8. Because of the narrowed scope of the ECCN controls
under Sec. 746.10, this rule removes the exclusion from the paragraph
(a) introductory text for ECCNs 5A991, 5A992.c, and 5D992.c because it
is no longer needed.
In Sec. 746.8, this rule adds a sentence to the end of the
paragraph (a) introductory text to specify that this section is used
for determining license requirements for exports, reexports, and
transfers to or within Russia or Belarus of any item that is listed in
supplement nos. 4 through 6 and is classified in an ECCN. This rule
also adds a second sentence to direct exporters, reexporters, and
transferors to see Sec. Sec. 746.5 and 746.10 for license
requirements, license review policies, and license exceptions for
exports, reexports, and transfers (in-country) to or within Russia or
Belarus of any EAR99-designated item that is also listed in supplement
nos. 4 through 6, and to also consult the end-use and end-user controls
under part 744 of the EAR. This rule adds a third sentence to specify
that this ECCN exclusion from the scope of the license requirements in
Sec. Sec. 746.5 and 746.10 is not applicable to the end-use license
requirements imposed under Sec. 746.5(a)(1)(i) or the end-user license
requirements imposed under Sec. 746.10(a)(2).
4. Clarification that fasteners are excluded from the scope of
supplement nos. 2, 4, 5, and 7, but are subject to the license
requirements under Sec. 744.21 for Russia and Belarus, as well as any
other part 744 license requirement that applies to all items subject to
the EAR.
Supplement nos. 2, 4, 5, and 7 to part 746 include text that
specifies that items described in each of these supplements include any
modified or designed ``components,'' ``parts,'' ``accessories,'' and
``attachments'' therefor regardless of the HTS Code or HTS Description
of the ``components,'' ``parts,'' ``accessories,'' and ``attachments,''
apart from any ``part'' or minor ``component'' that is a fastener
(e.g., screw, bolt, nut, nut plate, stud, insert, clip, rivet, pin),
washer, spacer, insulator, grommet, bushing, spring, wire, or solder.
BIS has received questions from the public asking for confirmation
whether a fastener (e.g., screw, bolt, nut, nut plate, stud, insert,
clip, rivet, pin), washer, spacer, insulator, grommet, bushing, spring,
wire, or solder, which are excluded from the scope of these three
supplements and the license requirements under the respective
Sec. Sec. 746.5, 746.8, and 746.10, could therefore be exported,
reexported, or transferred (in-country) to a Russian or Belarusian
``military end user'' or for a Russian or Belarusian ``military end
use.'' A license would be required for such an export, reexport, or
transfer (in-country) under Sec. 744.21 (Restrictions on certain
`military end uses' or `military end users'). In addition to clarifying
this response to these questions, this rule revises the introductory
text of supplement nos. 2, 4, and 5 to add two sentences to specify
that although these fasteners (e.g., screws, bolts, nuts, nut plates,
studs, inserts, clips, rivets, pins, washers, spacers, insulators,
grommets, bushing, springs, wires, and solders) are excluded from the
scope of these respective supplements, the exporter, reexporter, or
transferor must also review part 744 for the license requirements for
Russia and Belarus that extend to all items ``subject to the EAR.''
5. Harmonization of License Exceptions available under Sec. Sec.
746.5, 746.8 and 746.10, except as limited in the introductory text of
the respective paragraph (c) paragraphs.
In Sec. Sec. 746.5, 746.8, and 746.10, this rule revises paragraph
(c) (License exceptions) for each of these three sections to adopt a
common set of license exceptions that are available for the Russia and
Belarus controls being implemented under part 746 of the EAR. In order
to use any EAR License Exception, the export, reexport, or transfer
(in-country) must not be otherwise restricted under Sec. 740.2 and
must meet all of the applicable terms and conditions of the referenced
license exception. Because of the differences in scope between
supplement nos. 2, 4, 5, and 6, as well as some of the differences
referenced in Sec. Sec. 746.5, 746.8, and 746.10, BIS has not allowed
license exceptions for all Russia controls equally. In general, there
have been good reasons for this; for example, there is no reason to add
a license exception for a CCL item in a section of the EAR that does
not apply to CCL items. However, BIS has found that in some cases, this
approach to license exception eligibility has caused confusion, such as
when a particular item is controlled under multiple provisions, only
one of which is eligible for a particular license exception. This rule
adopts a common set of license exceptions for all three sections. BIS
notes that the change described under section B.3 of this rule (i.e.,
on order of review) will also likely reduce issues related to the
inconsistent language in Russia-related sections of part 746
significantly, but to ensure the issue is addressed as fully as
possible, this rule also adopts this common list of EAR License
Exceptions that will be available under these three sections.
This rules also places the License Exceptions in numerical order
for ease of reference under each of the paragraph (c) references. This
rule does not adopt a common set of License Exceptions for Sec. 746.6
(on the Temporarily occupied Crimea region of Ukraine and covered
regions of Ukraine) and does not expand the scope of license exceptions
available to overcome the end-user license requirements under Sec.
746.10(a)(2) because changes are not warranted for those sections. For
ease of reference, BIS has set out a short table below with the License
Exceptions in one column and then three additional columns for
Sec. Sec. 746.5, 746.8, and 746.10 indicating the availability of each
License
[[Page 4808]]
Exception. For the column entries that indicate ``Available'' that
section included this license exception eligibility prior to this rule.
For any column that indicates ``Eligibility added,'' this rule is
adding EAR License Exception eligibility for that respective section.
Table for Comparison of License Exception Eligibility Prior to This
Rule and New License Exception Eligibility Added by This Rule
BIS cautions exporters, reexporters, and transferors that a license
exception or portion of a license exception that is referenced as being
available under Sec. Sec. 746.5, 746.8, and 746.10 is only the first
step in determining whether the referenced EAR license exception or
portion of such license exception may actually be used. The exporter,
reexporter, or transferor must then review Sec. 740.2 to confirm that
none of the general restrictions on the use of EAR License Exceptions
apply, followed by a review to determine whether the contemplated
transaction meets all of the applicable terms and conditions of the
referenced license exception.
----------------------------------------------------------------------------------------------------------------
License exceptions Sec. 746.5 Sec. 746.8 Sec. 746.10
----------------------------------------------------------------------------------------------------------------
License Exception temporary exports Eligibility added...... Available.............. Eligibility added.
and reexports (TMP) for items for
use by the news media as set forth
in Sec. 740.9(a)(9) of the EAR.
License Exception governments and Available.............. Available.............. Eligibility added.
international organizations (GOV)
(Sec. 740.11(b)).
License Exception software updates Eligibility added...... Available.............. Eligibility added.
(TSU) for software updates for civil
end-users that are wholly-owned U.S.
subsidiaries, branches, or sales
offices, foreign subsidiaries,
branches, or sales offices of U.S.
companies that are joint ventures
with other U.S. and companies, joint
ventures of U.S. companies with
companies headquartered in countries
from Country Group A:5 and A:6 in
supplement no. 1 to part 740 of the
EAR countries, the wholly-owned
subsidiaries, branches, or sales
offices of companies headquartered
in countries from Country Group A:5
and A:6 in supplement no. 1 to part
740, or joint ventures of companies
headquartered in Country Group A:5
and A:6 with other companies
headquartered in Country Groups A:5
and A:6 (Sec. 740.13(c) of the
EAR).
License Exception baggage (BAG), Eligibility added...... Available.............. Available.
excluding firearms and ammunition
(Sec. 740.14, excluding paragraph
(e), of the EAR).
License Exception aircraft, vessels Available.............. Available.............. Eligibility added.
and spacecraft (AVS), excluding any Note: A narrower subset
aircraft registered in, owned or of License Exception
controlled by, or under charter or AVS was previously
lease by Russia or Belarus or a referenced, but for
national of Russia or Belarus (Sec. conformity with the
740.15(a) and (b) of the EAR). other two sections
this rule adopts the
same License Exception
AVS eligibility.
License Exception encryption Eligibility added...... Available.............. Eligibility added.
commodities, software, and
technology (ENC) for civil end-users
that are wholly-owned U.S.
subsidiaries, branches, or sales
offices, foreign subsidiaries,
branches, or sales offices of U.S.
companies that are joint ventures
with other U.S. companies, joint
ventures of U.S. companies with
companies headquartered in countries
from Country Group A:5 and A:6 in
supplement no. 1 to part 740 of the
EAR countries, the wholly-owned
subsidiaries, branches, or sales
offices of companies headquartered
in countries from Country Group A:5
and A:6 in supplement no. 1 to part
740, or joint ventures of companies
headquartered in Country Group A:5
and A:6 with other companies
headquartered in Country Groups A:5
and A:6 (Sec. Sec. 740.13(c) and
740.17 of the EAR).
License Exception commodities and Available.............. Available.............. Available.
software authorized under License
Exception consumer communications
devices (CCD) (Sec. 740.19 of the
EAR).
----------------------------------------------------------------------------------------------------------------
6. Clarification that ``medicines'' are excluded from the scope of
supplement no. 6 to part 746.
In supplement no. 6 to part 746 (Russian and Belarusian Industry
Sector Sanctions Pursuant to Sec. 746.5(a)(1)(iii)), this rule adds
one sentence to the end of the introductory text to the supplement to
specify that this supplement does not include any item that meets the
definition of ``medicine'' in Sec. 772.1 of the EAR. Under the EAR,
including Russia and Belarus sanctions, ``medicines'' means a ``drug''
as defined in section 201 of the Federal Food, Drug and Cosmetic Act
(21 U.S.C. 321). For purposes of the EAR, medicine includes EAR99
prescription and over the counter medicines for humans and animals.
This rule specifies here that certain medicines, such as certain
vaccines and immunotoxins, are on the Commerce Control List and are not
affected by this change.
7. Conforming change to adopt case-by-case license review policy
for applications related to safety of flight under Sec. Sec. 746.5 and
746.10 to conform with Sec. 746.8.
[[Page 4809]]
This rule also makes a conforming change to the licensing policy in
Sec. Sec. 746.5(b)(2) and 746.10(b) to add applications related to
safety of flight to the case-by-case license review policy under these
two sections for consistency with the licensing policy in Sec.
746.8(b). This conforming change is made because certain EAR99 items
used in aircraft that may be related to safety of flight are identified
in supplement nos. 4 and 5 and license applications for these items
should be reviewed consistently with the license review policy in Sec.
746.8. Specifically, in Sec. 746.5, this rule adds a new paragraph
(b)(2)(i) to add applications related to safety of flight to the case-
by-case license review policy and redesignates existing paragraphs
(b)(2)(i) through (v) as paragraphs (b)(2)(ii) through (vi),
respectively. In Sec. 746.10, this rule revises paragraph (b)
(Licensing policy) to add a new paragraph (b)(1) (Presumption of
denial) and adds a new paragraph (b)(2) (Case-by-case) to specify the
license applications that will be reviewed under a case-by-case
licensing policy. This rule adds a new paragraph (b)(2)(i) for the
case-by-case licensing policy for applications related to safety of
flight and adds new paragraphs (b)(2)(ii) and (iii) for the previous
case-by-case licensing policies that already applied under paragraph
(b) of Sec. 746.10.
BIS reminds applicants that BIS and the other license review
agencies have used a narrow and restrictive interpretation of what
items would qualify for the ``related to safety of flight'' category
set forth in Sec. 746.8(b)(2)(i). When BIS originally added the case-
by-case license review policy to Sec. 746.8(b), BIS provided guidance
as part of BIS's outreach on the Russia sanctions, such as at BIS
conferences and outreach seminars, to clarify that falling within this
safety of flight-related category would have to satisfy a strict
standard and would not apply broadly to all items used on an aircraft,
but only to those items without which an aircraft would be unable to be
safely operated. BIS does not intend that this category apply to
aircraft that are in ``production,'' only those that require safety-
critical items in an emergency. Since that time, BIS has consistently
maintained this position in its review of applications as well as in
outreach efforts.
8. Clarification that the import restriction on the temporary
import of firearms from Ukraine does not apply to firearms that were
previously exported, reexported, or transferred (in-country) under a
BIS license that are being temporarily returned for repair and
servicing.
BIS has authorized under BIS licenses the export and reexport to
Ukraine of various firearms subject to the EAR since the Russian
invasion of Ukraine. BIS has received questions from the public on
whether it would be permissible to temporarily return those firearms to
the United States for repair and servicing and to subsequently return
those firearms under License Exception Replacement of Parts and
Equipment (RPL) (Sec. 740.10(b)) or under a new BIS license if the
capabilities of the firearms were changed as a result of such repair
and servicing. BIS will be updating the ``Exports of Firearms and
Related Items FAQs'' on the BIS website at <a href="https://www.bis.doc.gov/index.php/documents/policy-guidance/2572-faqs-for-the-commerce-category-i-iii-firearms-rule-posted-on-bis-website-7-7-20/file">https://www.bis.doc.gov/index.php/documents/policy-guidance/2572-faqs-for-the-commerce-category-i-iii-firearms-rule-posted-on-bis-website-7-7-20/file</a> to
address this question. Because of the importance of the answer to this
question for Ukraine's continued ability to receive these items as part
of its defense against Russia's war of aggression, and to inform as
many exporters, reexporters, and transferors (in-country) as possible,
BIS is also publishing this new firearms frequently asked question
(FAQ) in the preamble of this rule. U.S. origin firearms originally
provided to Ukraine pursuant to a BIS license may be temporarily
imported pursuant to the EAR for repair or for replacement under
License Exception RPL (15 CFR 740.10(b)(4)(i)) for return to Ukraine
for use in its defense against Russia's war of aggression, because such
activity is consistent with the EAR and U.S. foreign policy.
Q: My company exported 500 firearms classified under ECCN 0A501.a
under a BIS license to Ukraine in 2022. These rifles are not specified
under Annex A in supplement no. 4 to part 740. At this time, the
consignee in Ukraine needs to temporarily return 50 of the rifles that
they received under a BIS license to my company in the United States
for repair and servicing. I have reviewed the general restrictions
under 15 CFR 740.2 and the applicable terms and conditions under
License Exception RPL under 15 CFR 740.10(b) and believe the export
would meet the terms of using License Exception RPL, except I have a
question on the applicability of the restriction under 15 CFR
740.10(b)(4)(i) that specifies that ``[t]he firearms were not shipped
from or manufactured in Russia, Georgia, Kazakhstan, Kyrgyzstan,
Moldova, Turkmenistan, Ukraine, or Uzbekistan, except for any firearm
model controlled by 0A501 that is specified under Annex A in Supplement
No. 4 to this part.'' Does this restriction apply for temporarily
importing firearms from Ukraine that were received in Ukraine under a
BIS license or other U.S. Government authorization that will
subsequently be authorized under License Exception RPL? Can you also
confirm whether your answer to this License Exception RPL question
would also apply to the same restriction that is also found under 15
CFR 740.9(b)(5)(ii) for exports of firearms and certain shotguns
temporarily in the United States and in supplement no. 2 to part 748,
paragraph (z) certification requirement for exports of firearms and
certain shotguns temporarily in the United States?
A: The restrictions under 15 CFR 740.10(b)(4)(i) and
740.9(b)(5)(ii) and the certification requirement for BIS licenses
under supplement no. 2 to part 748, paragraph (z) do not apply to
temporary imports into the U.S. of any firearm that is subject to the
EAR that was exported, reexported to, or transferred within Ukraine
under a BIS authorization or a Department of State authorization under
the 22 CFR 120.5(b) process.
Savings Clause
For the changes being made in this final rule, shipments of items
removed from eligibility for a License Exception or export, reexport,
or transfer (in-country) without a license (NLR) as a result of this
regulatory action that were en route aboard a carrier to a port of
export, reexport, or transfer (in-country), on January 23, 2024,
pursuant to actual orders for export, reexport, or transfer (in-
country) to or within a foreign destination, may proceed to that
destination under the previous eligibility for a License Exception or
export, reexport, or transfer (in-country) without a license (NLR),
provided the export, reexport, or transfer (in-country) is completed no
later than on February 22, 2024.
Export Control Reform Act of 2018
On August 13, 2018, the President signed into law the John S.
McCain National Defense Authorization Act for Fiscal Year 2019, which
included the Export Control Reform Act of 2018 (ECRA) (codified, as
amended, at 50 U.S.C. 4801-4852). ECRA provides the legal basis for
BIS's principal authorities and serves as the authority under which BIS
issues this rule. To the extent it applies to certain activities that
are the subject of this rule, the Trade Sanctions Reform and Export
Enhancement Act of 2000 (TSRA) (codified, as amended, at 22 U.S.C.
7201-7211) also serves as authority for this rule.
[[Page 4810]]
Rulemaking Requirements
1. BIS has examined the impact of this rule as required by
Executive Orders 12866, 13563, and 14094, which direct agencies to
assess all costs and benefits of available regulatory alternatives and,
if regulation is necessary, to select regulatory approaches that
maximize net benefits (including potential economic, environmental,
public, health, and safety effects, distributive impacts, and equity).
This final rule has been determined to be not significant for purposes
of Executive Order 12866.
2. Notwithstanding any other provision of law, no person is
required to respond to, nor shall any person be subject to a penalty
for failure to comply with, a collection of information subject to the
requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et
seq.) (PRA), unless that collection of information displays a currently
valid Office of Management and Budget (OMB) Control Number.
This rule involves the following OMB-approved collections of
information subject to the PRA:
<bullet> 0694-0088, ``Multi-Purpose Application,'' which carries a
burden hour estimate of 29.4 minutes for a manual or electronic
submission;
<bullet> 0694-0096 ``Five Year Records Retention Period,'' which
carries a burden hour estimate of less than 1 minute; and
<bullet> 0607-0152 ``Automated Export System (AES) Program,'' which
carries a burden hour estimate of 3 minutes per electronic submission.
BIS estimates that these new controls on Russia, Belarus, and Iran
under the EAR will result in an increase of 35 license applications
submitted annually to BIS. However, the additional burden falls within
the existing estimates currently associated with these control numbers.
Additional information regarding these collections of information--
including all background materials--can be found at <a href="https://www.reginfo.gov/public/do/PRAMain">https://www.reginfo.gov/public/do/PRAMain</a> by using the search function to enter
either the title of the collection or the OMB Control Number.
3. This rule does not contain policies with federalism implications
as that term is defined in Executive Order 13132.
4. Pursuant to section 1762 of the Export Control Reform Act of
2018 (50 U.S.C. 4821) (ECRA), this action is exempt from the
Administrative Procedure Act (APA) (5 U.S.C. 553) requirements for
notice of proposed rulemaking, opportunity for public participation,
and delay in effective date. While section 1762 of ECRA provides
sufficient authority for such an exemption, this action is also
independently exempt from these APA requirements because it involves a
military or foreign affairs function of the United States (5 U.S.C.
553(a)(1)).
5. Because a notice of proposed rulemaking and an opportunity for
public comment are not required to be given for this rule by 5 U.S.C.
553, or by any other law, the analytical requirements of the Regulatory
Flexibility Act, 5 U.S.C. 601, et seq., are not applicable.
Accordingly, no regulatory flexibility analysis is required, and none
has been prepared.
List of Subjects
15 CFR Part 734
Administrative practice and procedure, Exports, Inventions and
patents, Research, Science and technology.
15 CFR Part 746
Exports, Reporting and recordkeeping requirements.
For the reasons stated in the preamble, parts 734 and 746 of the
Export Administration Regulations (15 CFR parts 730 through 774) are
amended as follows:
PART 734--SCOPE OF THE EXPORT ADMINISTRATION REGULATIONS
0
1. The authority citation for 15 CFR part 734 continues to read as
follows:
Authority: 50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.; 50
U.S.C. 1701 et seq.; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p.
950; E.O. 13020, 61 FR 54079, 3 CFR, 1996 Comp., p. 219; E.O. 13026,
61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3
CFR, 2001 Comp., p. 783; E.O. 13637, 78 FR 16129, 3 CFR, 2014 Comp.,
p. 223; Notice of November 8, 2022, 87 FR 68015, 3 CFR, 2022 Comp.,
p. 563.
0
2. Section 734.4 is amended by revising paragraph (a)(6)(ii) to read as
follows:
Sec. 734.4 De minimis U.S. content.
(a) * * *
(6) * * *
(ii) There is no de minimis level for foreign-made items that
incorporate U.S.-origin 9x515 or ``600 series'' .y items when destined
for a country listed in Country Group E:1 or E:2 of supplement no. 1 to
part 740 of the EAR or for Belarus, the People's Republic of China
(PRC), or Russia.
* * * * *
0
3. Supplement no. 2 to part 734 is amended by revising the third
sentence of paragraph (a)(1) to read as follows:
Supplement No. 2 to Part 734--Guidelines for De Minimis Rules
(a) * * *
(1) * * * For purposes of identifying U.S.-origin controlled
content, you should consult the Commerce Country Chart in supplement
no. 1 to part 738 of the EAR and controls described in part 746 of the
EAR (excluding U.S.-origin content that meets the criteria in Sec.
746.5(a)(3), Sec. 746.7(a)(1)(v), Sec. 746.8(a)(5), or Sec.
746.10(a)(3)). * * *
* * * * *
PART 746--EMBARGOES AND OTHER SPECIAL CONTROLS
0
4. The authority citation for 15 CFR part 746 continues to read as
follows:
Authority: 50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.; 50
U.S.C. 1701 et seq.; 22 U.S.C. 287c; Sec 1503, Pub. L. 108-11, 117
Stat. 559; 22 U.S.C. 2151 note; 22 U.S.C. 6004; 22 U.S.C. 7201 et
seq.; 22 U.S.C. 7210; E.O. 12854, 58 FR 36587, 3 CFR, 1993 Comp., p.
614; E.O. 12918, 59 FR 28205, 3 CFR, 1994 Comp., p. 899; E.O. 13222,
66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13338, 69 FR 26751, 3
CFR, 2004 Comp., p 168; Presidential Determination 2003-23, 68 FR
26459, 3 CFR, 2004 Comp., p. 320; Presidential Determination 2007-7,
72 FR 1899, 3 CFR, 2006 Comp., p. 325; Notice of May 810, 2023, 88
FR 30211 (May 10, 2023).
0
5. Section 746.5 is amended by:
0
a. Revising paragraph (a) introductory text;
0
b. Redesignating paragraphs (b)(2)(i) through (v) as paragraphs
(b)(2)(ii) through (vi), respectively;
0
c. Adding a new paragraph (b)(2)(i); and
0
d. Revising paragraph (c).
The revisions and addition read as follows:
Sec. 746.5 Russian and Belarusian industry sector sanctions.
(a) License requirements. For purposes of paragraphs (a)(1)(i)
through (iii) of this section, a license is not required for deemed
exports and deemed reexports. For purposes of paragraphs (a)(1)(ii) and
(iii) of this section, a license is not required for any item that is
listed in supplement no. 4 or 6 to this part that is also classified in
an Export Control Classification Number (ECCN) on the Commerce Control
List (CCL) in supplement no. 1 to part 774 of the EAR. See Sec. 746.8
for license requirements, license exceptions, and license review
policies for exports, reexports, and transfers to or within Russia or
Belarus for items classified in ECCNs.
* * * * *
(b) * * *
(2) * * *
[[Page 4811]]
(i) Applications related to safety of flight;
* * * * *
(c) License exceptions. No license exceptions may overcome the
license requirements set forth in this section, except the license
exceptions identified in paragraphs (c)(2) and (7) of this section.
(1) License Exception TMP for items for use by the news media as
set forth in Sec. 740.9(a)(9) of the EAR.
(2) License Exception GOV (Sec. 740.11(b) of the EAR).
(3) License Exception TSU for software updates for civil end-users
that are wholly-owned U.S. subsidiaries, branches, or sales offices,
foreign subsidiaries, branches, or sales offices of U.S. companies that
are joint ventures with other U.S. and companies, joint ventures of
U.S. companies with companies headquartered in countries from Country
Group A:5 and A:6 in supplement no. 1 to part 740 of the EAR countries,
the wholly-owned subsidiaries, branches, or sales offices of companies
headquartered in countries from Country Group A:5 and A:6 in supplement
no. 1 to part 740, or joint ventures of companies headquartered in
Country Group A:5 and A:6 with other companies headquartered in Country
Groups A:5 and A:6 (Sec. 740.13(c) of the EAR).
(4) License Exception BAG, excluding firearms and ammunition (Sec.
740.14, excluding paragraph (e), of the EAR).
(5) License Exception AVS, excluding any aircraft registered in,
owned or controlled by, or under charter or lease by Russia or Belarus
or a national of Russia or Belarus (Sec. 740.15(a) and (b) of the
EAR).
(6) License Exception encryption commodities, software, and
technology (ENC) for civil end-users that are wholly-owned U.S.
subsidiaries, branches, or sales offices, foreign subsidiaries,
branches, or sales offices of U.S. companies that are joint ventures
with other U.S. companies, joint ventures of U.S. companies with
companies headquartered in countries from Country Group A:5 and A:6 in
supplement no. 1 to part 740 of the EAR countries, the wholly-owned
subsidiaries, branches, or sales offices of companies headquartered in
countries from Country Group A:5 and A:6 in supplement no. 1 to part
740, or joint ventures of companies headquartered in Country Group A:5
and A:6 with other companies headquartered in Country Groups A:5 and
A:6 (Sec. Sec. 740.13(c) and 740.17 of the EAR).
(7) License Exception CCD (Sec. 740.19 of the EAR).
0
6. Section 746.6 is amended by adding paragraph (a)(5) to read as
follows:
Sec. 746.6 Temporarily occupied Crimea region of Ukraine and covered
regions of Ukraine.
(a) * * *
(5) Exclusion for deployments by the Government of Ukraine to or
within the temporarily occupied Crimea region of Ukraine or covered
regions of Ukraine. The license requirements of paragraph (a) of this
section do not apply to exports, reexports, and transfers (in country)
used in or for deployments by the Government of Ukraine to or within
the temporarily occupied Crimea region of Ukraine or covered regions of
Ukraine.
* * * * *
0
7. Section 746.8 is amended by:
0
a. Adding three sentences to the end of paragraph (a) introductory
text; and
0
b. Revising paragraph (c).
The additions and revision read as follows:
Sec. 746.8 Sanctions against Russia and Belarus.
(a) * * * This section is also used for determining license
requirements for exports, reexports, and transfers to or within Russia
or Belarus of any item that is listed in supplement nos. 4 through 6 to
this part and is classified in an Export Control Classification Number
(ECCN) on the Commerce Control List (CCL) in supplement no. 1 to part
774 of the EAR. See Sec. Sec. 746.5 and 746.10 for license
requirements, license review policies, and license exceptions for
exports, reexports, and transfers (in-country) to or within Russia or
Belarus of any EAR99-designated item that is also listed in supplement
nos. 4 through 6 and the end-use and end-user controls under part 744
of the EAR. This ECCN exclusion from the scope of the license
requirements from Sec. Sec. 746.5 and 746.10 is not applicable to the
end-use license requirements imposed under Sec. 746.5(a)(1)(i) or the
end-user license requirements imposed under Sec. 746.10(a)(2).
* * * * *
(c) License exceptions. No license exceptions may overcome the
license requirements in paragraph (a)(3) of this section, except as
specified in the Entity List entry for a Footnote 3 entity on the
Entity List in supplement no. 4 to part 744 of the EAR. No license
exceptions may overcome the license requirements in paragraphs (a)(1)
and (2) of this section except the license exceptions identified in
paragraphs (c)(1) through (7) of this section.
(1) License Exception TMP for items for use by the news media as
set forth in Sec. 740.9(a)(9) of the EAR.
(2) License Exception GOV (Sec. 740.11(b) of the EAR).
(3) License Exception TSU for software updates for civil end-users
that are wholly-owned U.S. subsidiaries, branches, or sales offices,
foreign subsidiaries, branches, or sales offices of U.S. companies that
are joint ventures with other U.S. and companies, joint ventures of
U.S. companies with companies headquartered in countries from Country
Group A:5 and A:6 in supplement no. 1 to part 740 of the EAR countries,
the wholly-owned subsidiaries, branches, or sales offices of companies
headquartered in countries from Country Group A:5 and A:6 in supplement
no. 1 to part 740, or joint ventures of companies headquartered in
Country Group A:5 and A:6 with other companies headquartered in Country
Groups A:5 and A:6 (Sec. 740.13(c) of the EAR).
(4) License Exception BAG, excluding firearms and ammunition (Sec.
740.14, excluding paragraph (e), of the EAR).
(5) License Exception AVS, excluding any aircraft registered in,
owned or controlled by, or under charter or lease by Russia or Belarus
or a national of Russia or Belarus (Sec. 740.15(a) and (b) of the
EAR).
(6) License Exception ENC for civil end-users that are wholly-owned
U.S. subsidiaries, branches, or sales offices, foreign subsidiaries,
branches, or sales offices of U.S. companies that are joint ventures
with other U.S. companies, joint ventures of U.S. companies with
companies headquartered in countries from Country Group A:5 and A:6 in
supplement no. 1 to part 740 of the EAR countries, the wholly-owned
subsidiaries, branches, or sales offices of companies headquartered in
countries from Country Group A:5 and A:6 in supplement no. 1 to part
740, or joint ventures of companies headquartered in Country Group A:5
and A:6 with other companies headquartered in Country Groups A:5 and
A:6 (Sec. Sec. 740.13(c) and 740.17 of the EAR).
(7) License Exception CCD (Sec. 740.19 of the EAR).
0
8. Section 746.10 is amended by:
0
a. Revising paragraph (a) introductory text;
0
b. Adding paragraph (a)(3); and
0
c. Revising paragraphs (b) and (c).
The revisions and additions read as follows:
[[Page 4812]]
Sec. 746.10 `Luxury goods' sanctions against Russia and Belarus and
Russian and Belarusian oligarchs and malign actors.
(a) License requirements. For purposes of paragraph (a)(1) of this
section, a license is not required for any item that is listed in
supplement no. 5 to this part that is also classified in an Export
Control Classification Number (ECCN) on the Commerce Control List (CCL)
in supplement no. 1 to part 774 of the EAR. See Sec. 746.8 for license
requirements, license exceptions, and license review policies for
exports, reexports, and transfers to or within Russia or Belarus for
items classified in ECCNs.
* * * * *
(3) Exclusion from scope of U.S.-origin controlled content under
paragraphs (a)(1) and (2) of this section. For purposes of determining
U.S.-origin controlled content under supplement no. 2 to part 734 of
the EAR when making a de minimis calculation for reexports and exports
from abroad to Russia or Belarus, the license requirements in
paragraphs (a)(1) and (2) of this section are not used to determine
controlled U.S.-origin content in a foreign-made item, provided the
criteria in paragraphs (a)(3)(i) and (ii) of this section are met:
(i) The U.S.-origin content is described in supplement no. 5 to
this part and is not otherwise excluded from the applicable Scope
column in supplement no. 3 to this part; and
(ii) The foreign made item will be reexported or exported from
abroad from a country described in supplement no. 3 to this part.
* * * * *
(b) Licensing policy--(1) Presumption of denial. Applications for
the export, reexport, or transfer (in-country) of any item that
requires a license for pursuant to the requirements of this section
will be reviewed with a policy of denial, except as specified in
paragraph (b)(2) of this section.
(2) Case-by-case. The following types of license applications will
be reviewed on a case-by-case basis to determine whether the
transaction in question would benefit the Russian or Belarusian
Government or defense sector:
(i) Applications related to safety of flight;
(ii) Applications involving items to meet humanitarian needs. The
case-by-case license application review policy for items to meet
humanitarian needs is included to address certain `luxury goods' items
that may be used in medical devices or situations in which a case-by-
case analysis is needed to determine whether a license application
should be approved to meet humanitarian needs while also taking into
account the applicable broader U.S. national security and foreign
policy concerns; and
(iii) Applications for the disposition of items by companies not
headquartered in Country Group D:1, D:5, E:1 or E:2 in supplement no. 1
to part 740 of the EAR that are curtailing or closing all operations in
Russia or Belarus; and replacement licenses for exports and reexports
to and transfers within Russia and Belarus to add items described in
Harmonized Tariff Schedule (HTS)-6 Codes that were added to the EAR
after the effective validation date of the BIS license. See also Sec.
750.7(c)(1)(xi) of the EAR for the divesture of items within Russia or
Belarus or the transfer of items within Russia or Belarus for the
purpose of reexporting from Russia or Belarus. For purposes of Sec.
750.7(c)(1)(xi), divesture means the action or process of selling off
subsidiary business interests or investments involving items subject to
the EAR.
(c) License exceptions. No license exceptions may overcome the
license requirements in paragraph (a)(1) of this section except the
license exceptions identified in paragraphs (c)(1) through (3) of this
section. No license exceptions may overcome the license requirements in
paragraph (a)(2) of this section.
(1) License Exception TMP for items for use by the news media as
set forth in Sec. 740.9(a)(9) of the EAR.
(2) License Exception GOV (Sec. 740.11(b) of the EAR).
(3) License Exception TSU for software updates for civil end-users
that are wholly-owned U.S. subsidiaries, branches, or sales offices,
foreign subsidiaries, branches, or sales offices of U.S. companies that
are joint ventures with other U.S. and companies, joint ventures of
U.S. companies with companies headquartered in countries from Country
Group A:5 and A:6 in supplement no. 1 to part 740 of the EAR countries,
the wholly-owned subsidiaries, branches, or sales offices of companies
headquartered in countries from Country Group A:5 and A:6 in supplement
no. 1 to part 740, or joint ventures of companies headquartered in
Country Group A:5 and A:6 with other companies headquartered in Country
Groups A:5 and A:6 (Sec. 740.13(c) of the EAR).
(4) License Exception BAG, excluding firearms and ammunition (Sec.
740.14, excluding paragraph (e), of the EAR).
(5) License Exception AVS, excluding any aircraft registered in,
owned or controlled by, or under charter or lease by Russia or Belarus
or a national of Russia or Belarus (Sec. 740.15(a) and (b) of the
EAR).
(6) License Exception ENC for civil end-users that are wholly-owned
U.S. subsidiaries, branches, or sales offices, foreign subsidiaries,
branches, or sales offices of U.S. companies that are joint ventures
with other U.S. companies, joint ventures of U.S. companies with
companies headquartered in countries from Country Group A:5 and A:6 in
supplement no. 1 to part 740 of the EAR countries, the wholly-owned
subsidiaries, branches, or sales offices of companies headquartered in
countries from Country Group A:5 and A:6 in supplement no. 1 to part
740, or joint ventures of companies headquartered in Country Group A:5
and A:6 with other companies headquartered in Country Groups A:5 and
A:6 (Sec. Sec. 740.13(c) and 740.17 of the EAR).
(7) License Exception CCD (Sec. 740.19 of the EAR).
0
9. Supplement no. 2 to part 746 is amended by adding a sentence
following the second sentence of paragraph (a) to read as follows:
Supplement No. 2 to Part 746--Russian and Belarusian Industry Sector
Sanction List Pursuant to Sec. 746.5(a)(1)(i)
(a) * * * Although fasteners (e.g., screws, bolts, nuts, nut
plates, studs, inserts, clips, rivets, pins), washers, spacers,
insulator, grommets, bushings, springs, wires, and solders are excluded
from the scope of this supplement, see part 744 of the EAR for license
requirements for Russia and Belarus that extend to all items ``subject
to the EAR,'' e.g., Sec. 744.21 of the EAR and the Entity List license
requirements, which in most cases extend to all items ``subject to the
EAR.'' * * *
* * * * *
0
10. Supplement no. 4 to part 746 is amended by:
0
a. Adding a sentence following the second sentence of paragraph (a);
and
0
b. Adding in numerical order the following entries to the table:
``270111,'' ``270112,'' ``270119,'' ``270120,'' ``270210,'' ``270220,''
``270300,'' ``270400,'' ``270720,'' ``270730,'' ``270820,'' ``271019,''
``271210,'' ``271290,'' ``271500,'' ``280110,'' ``280200,'' ``280410,''
``280430,'' ``280461,'' ``280470,'' ``280480,'' ``280511,'' ``280610,''
``280620,'' ``281111,'' ``281129,'' ``281310,'' ``281410,'' ``281420,''
``281512,'' ``281830,'' ``281990,'' ``282010,'' ``282731,'' ``282732,''
``282735,'' ``282751,'' ``282890,'' ``282990,'' ``283220,'' ``283324,''
``283330,'' ``283410,'' ``283630,'' ``283650,''
[[Page 4813]]
``283990,'' ``284030,'' ``284150,'' ``284180,'' ``284310,'' ``284329,''
``284330,'' ``284910,'' ``320611,'' ``391220,'' ``401699,'' ``540249,''
``591190,'' ``680520,'' ``681299,'' ``690919,'' ``701990,'' ``811241,''
``811249,'' ``820411,'' ``820559,'' ``820790,'' ``880100,'' ``880211,''
``880212,'' ``880220,'' ``880230,'' ``880240,'' ``880260,'' ``880400,''
``880510,'' ``880521,'' ``880529,'' ``880610,'' ``880621,'' ``880622,''
``880623,'' ``880624,'' ``880629,'' ``880691,'' ``880692,'' ``880693,''
``880694,'' ``880699,'' ``880710,'' ``880720,'' ``880730,'' and
``880790''.
The additions read as follows:
Supplement No. 4 to Part 746--Russian and Belarusian Industry Sector
Sanctions Pursuant to Sec. 746.5(a)(1)(ii)
(a) * * * Although fasteners (e.g., screws, bolts, nuts, nut
plates, studs, inserts, clips, rivets, pins), washers, spacers,
insulators, grommets, bushings, springs, wires, and solders are
excluded from the scope of this supplement, see part 744 of the EAR for
license requirements for Russia and Belarus that extend to all items
``subject to the EAR,'' e.g., Sec. 744.21 of the EAR and the Entity
List license requirements, which in most cases extend to all items
``subject to the EAR.'' * * *
* * * * *
------------------------------------------------------------------------
HTS-6 code HTS description
------------------------------------------------------------------------
* * * * * * *
270111....................... ANTHRACITE COAL, WHETHER OR NOT
PULVERIZED, BUT NOT AGGLOMERATED.
270112....................... BITUMINOUS COAL, WHETHER OR NOT
PULVERIZED, BUT NOT AGGLOMERATED.
270119....................... COAL, OTHER THAN ANTHRACITE OR
BITUMINOUS, WHETHER OR NOT PULVERIZED,
BUT NOT AGGLOMERATED.
270120....................... BRIQUETTES, OVOIDS AND SIMILAR SOLID
FUELS FROM COAL.
270210....................... LIGNITE, NOT AGGLOMERATED, EXCLUDING JET.
270220....................... AGGLOMERATED LIGNITE, EXCLUDING JET.
270300....................... PEAT (INCLUDING PEAT LITTER) WHETHER OR
NOT AGGLOMERATED.
270400....................... COKE AND SEMICOKE OF COAL, OF LIGNITE OR
OF PEAT, WHETHER OR NOT AGGLOMERATED;
RETORT CARBON.
270720....................... TOLUENE.
270730....................... XYLENES.
270820....................... PITCH COKE FROM COAL AND OTHER MINERAL
TARS.
271019....................... PETROLEUM OILS, OILS FROM BITUMINOUS
MINERALS (OTHER THAN CRUDE) & PRODUCTS
CONTAINING BY WEIGHT GT=70% OR MORE OF
THESE OILS, NOT BIODIESEL OR WASTE.
271210....................... PETROLEUM JELLY.
271290....................... MICROCRYSTALLINE PETROLEUM WAX, SLACK
WAX, OZOKERITE, LIGNITE WAX, PEAT WAX,
OTHER MINERAL WAXES, AND SIMILAR
PRODUCTS, NESOI.
271500....................... BITUMINOUS MIXTURES BASED ON NATURAL
ASPHALT, NATURAL BITUMEN, PETROLEUM
BITUMEN, MINERAL TAR OR MINERAL TAR
PITCH.
280110....................... CHLORINE.
280200....................... SULFUR, SUBLIMED OR PRECIPITATED;
COLLODIAL SULFUR.
280410....................... HYDROGEN.
280430....................... NITROGEN.
280461....................... SILICON, CONTAINING BY WEIGHT NOT LESS
THAN 99.99% OF SILICON.
280470....................... PHOSPHORUS.
280480....................... ARSENIC.
280511....................... SODIUM.
280610....................... HYDROGEN CHLORIDE (HYDROCHLORIC ACID).
280620....................... CHLOROSULFURIC ACID.
281111....................... HYDROGEN FLUORIDE (HYDROFLUORIC ACID).
281129....................... INORGANIC OXYGEN COMPOUNDS OF NONMETALS,
NESOI.
281310....................... CARBON DISULFIDE.
281410....................... ANHYDROUS AMMONIA.
281420....................... AMMONIA IN AQUEOUS SOLUTION.
281512....................... SODIUM HYDROXIDE (CAUSTIC SODA), IN
AQUEOUS SOLUTION (SODA LYE OR LIQUID
SODA).
* * * * * * *
281830....................... ALUMINUM HYDROXIDE.
281990....................... CHROMIUM OXIDES AND HYDRIDES, EXCEPT
CHROMIUM TRIOXIDE, NESOI.
282010....................... MANGANESE DIOXIDE.
* * * * * * *
282731....................... MAGNESIUM CHLORIDE.
282732....................... ALUMINUM CHLORIDE.
282735....................... NICKEL CHLORIDE.
282751....................... BROMIDES OF SODIUM OR OF POTASSIUM.
282890....................... HYPOCHLORITES, CHLORITES, AND
HYPOBROMITES, NESOI.
* * * * * * *
282990....................... PERCHLORATES; BROMATES AND PERBROMATES;
IODATES AND PERIODATES.
283220....................... SULFITES, EXCEPT SODIUM SULFITES, NESOI.
283324....................... NICKEL SULFATE.
283330....................... ALUMS.
283410....................... NITRITES.
* * * * * * *
283630....................... SODIUM HYDROGENCARBONATE (SODIUM
BICARBONATE).
283650....................... CALCIUM CARBONATE.
283990....................... SILICATES; COMMERCIAL ALKALI METAL
SILICATES, NESOI.
[[Page 4814]]
284030....................... PEROXOBORATES (PERBORATES).
284150....................... CHROMATES AND DICHROMATES, NESOI;
PEROXOCHROMATES.
284180....................... TUNGSTATES (WOLFRAMATES).
284310....................... COLLOIDAL PRECIOUS METALS.
284329....................... SILVER COMPOUNDS, EXCEPT SILVER NITRATE,
NESOI.
284330....................... GOLD COMPOUNDS.
* * * * * * *
284910....................... CARBIDES OF CALCIUM, WHETHER OR NOT
CHEMICALLY DEFINED.
* * * * * * *
320611....................... PIGMENTS AND PREPARATIONS CONTAINING 80%
OR MORE BY WEIGHT OF TITANIUM DIOXIDE
CALCULATED ON THE DRY MATTER.
* * * * * * *
391220....................... CELLULOSE NITRATES (INCLUDING
COLLODIONS), IN PRIMARY FORMS.
* * * * * * *
401699....................... ARTICLES OF VULCANIZED RUBBER OTHER THAN
HARD RUBBER, NESOI.
* * * * * * *
540249....................... SYNTHETIC FILAMENT YARN EXCEPT SEWING
THREAD, NOT FOR RETAIL SALE, SINGLE YARN
NESOI, NOT OVER 50 TURNS PER METER IF
TWISTED, OF YARNS NESOI.
* * * * * * *
591190....................... TEXTILE PRODUCTS AND ARTICLES FOR
TECHNICAL USES NESOI.
* * * * * * *
680520....................... ABRASIVE POWDER OR GRAIN, ON A BASE OF
PAPER OR PAPERBOARD ONLY.
* * * * * * *
681299....................... ARTICLES OF FABRICATED ASBESTOS FIBERS
AND ARTICLES OF ASBESTOS MIXTURES,
NESOI.
* * * * * * *
690919....................... CERAMIC WARES FOR LABORATORY, CHEMICAL OR
OTHER TECHNICAL USES, OF OTHER THAN
PORCELAIN OR CHINA, NESOI.
* * * * * * *
701990....................... GLASS FIBERS AND ARTICLES THEREOF NESOI.
* * * * * * *
811241....................... GALLIUM, HAFNIUM, INDIUM, NIOBIUM
(COLUMBIUM), RHENIUM & ARTICLES OF THESE
METALS, INCLUDING WASTE & SCRAP.
811249....................... GALLIUM, HAFNIUM, INDIUM, NIOBIUM
(COLUMBIUM), RHENIUM AND THALLIUM AND
ARTICLES THEREOF, NESOI.
* * * * * * *
820411....................... SPANNERS AND WRENCHES, HAND-OPERATED, NON-
ADJUSTABLE, AND PARTS THEREOF, OF BASE
METAL.
820559....................... HANDTOOLS NESOI, AND PARTS THEREOF, OF
BASE METAL.
* * * * * * *
820790....................... INTERCHANGEABLE TOOLS NESOI, AND PARTS
THEREOF, OF BASE METAL.
* * * * * * *
880100....................... HANG GLIDERS, GLIDERS, BALLOONS,
DIRIGIBLES AND OTHER NON-POWERED
AIRCRAFT.
880211....................... HELICOPTERS OF AN UNLADEN WEIGHT NOT
EXCEEDING 2,000 KG.
880212....................... HELICOPTERS OF AN UNLADEN WEIGHT
EXCEEDING 2,000 KG.
880220....................... AIRPLANES AND OTHER AIRCRAFT NESOI, OF AN
UNLADEN WEIGHT NOT EXCEEDING 2,000 KG.
880230....................... AIRPLANES AND OTHER AIRCRAFT NESOI, OF AN
UNLADEN WEIGHT EXCEEDING 2,000 KG BUT
NOT EXCEEDING 15,000 KG.
880240....................... AIRPLANES AND OTHER AIRCRAFT NESOI, OF AN
UNLADEN WEIGHT EXCEEDING 15,000 KG.
880260....................... SPACECRAFT (INCLUDING SATELLITES) AND
SUBORBITAL AND SPACECRAFT LAUNCH
VEHICLES.
880400....................... PARACHUTES (INCLUDING DIRIGIBLE
PARACHUTES AND PARAGLIDERS) AND
ROTOCHUTES; PARTS THEREOF AND
ACCESSORIES THERETO.
880510....................... AIRCRAFT LAUNCHING GEAR AND PARTS
THEREOF; DECK-ARRESTORS OR SIMILAR GEAR
AND PARTS THEREOF.
880521....................... AIR COMBAT SIMULATORS AND PARTS THEREOF.
880529....................... GROUND FLYING TRAINERS AND PARTS THEREOF,
NESOI.
880610....................... UNMANNED AIRCRAFT DESIGNED FOR THE
CARRIAGE OF PASSENGERS.
880621....................... UNMANNED AIRCRAFT FOR REMOTE-CONTROLLED
FLIGHT ONLY, WITH MAXIMUM TAKE-OFF
WEIGHT NOT MORE THAN 250 G.
880622....................... UNMANNED AIRCRAFT FOR REMOTE-CONTROLLED
FLIGHT ONLY, WITH MAXIMUM TAKE-OFF
WEIGHT MORE THAN 250 G BUT NOT MORE THAN
7 KG.
880623....................... UNMANNED AIRCRAFT FOR REMOTE-CONTROLLED
FLIGHT ONLY, WITH MAXIMUM TAKE-OFF
WEIGHT MORE THAN 7 KG BUT NOT MORE THAN
25 KG.
[[Page 4815]]
880624....................... UNMANNED AIRCRAFT FOR REMOTE-CONTROLLED
FLIGHT ONLY, WITH MAXIMUM TAKE-OFF
WEIGHT MORE THAN 25 KG BUT NOT MORE THAN
150 KG.
880629....................... UNMANNED AIRCRAFT FOR REMOTE-CONTROLLED
FLIGHT ONLY, WITH MAXIMUM TAKE-OFF
WEIGHT MORE THAN 150 KG.
880691....................... UNMANNED AIRCRAFT WITH MAXIMUM TAKE-OFF
WEIGHT NOT MORE THAN 250 G, NESOI.
880692....................... UNMANNED AIRCRAFT WITH MAXIMUM TAKE-OFF
WEIGHT MORE THAN 250 G BUT NOT MORE THAN
7 KG, NESOI.
880693....................... UNMANNED AIRCRAFT WITH MAXIMUM TAKE-OFF
WEIGHT MORE THAN 7 KG BUT NOT MORE THAN
25 KG, NESOI.
880694....................... UNMANNED AIRCRAFT WITH MAXIMUM TAKE-OFF
WEIGHT MORE THAN 25 KG BUT NOT MORE THAN
150 KG, NESOI.
880699....................... UNMANNED AIRCRAFT WITH MAXIMUM TAKE-OFF
WEIGHT MORE THAN 150 KG, NESOI.
880710....................... PROPELLERS AND ROTORS AND PARTS THEREOF,
FOR BALLOONS, GLIDERS, OTHER AIRCRAFT
AND SPACECRAFT, ETC.
880720....................... UNDERCARRIAGES AND PARTS THEREOF, FOR
BALLOONS, GLIDERS, OTHER AIRCRAFT AND
SPACECRAFT, ETC.
880730....................... PARTS OF AIRPLANES OR HELICOPTERS, NESOI.
880790....................... PARTS FOR USE IN CIVIL AIRCRAFT,
BALLOONS, DIRIGIBLES, GLIDERS, HANG
GLIDERS AND OTHER NON-POWERED AIRCRAFT,
NESOI.
* * * * * * *
------------------------------------------------------------------------
0
11. Supplement no. 5 to part 746 is amended by adding a sentence
following the second sentence of paragraph (a) to read as follows:
Supplement No. 5 to Part 746--`Luxury Goods' Sanctions for Russia and
Belarus Pursuant to Sec. 746.10(a)(1) and (2)
(a) * * * Although fasteners (e.g., screws, bolts, nuts, nut
plates, studs, inserts, clips, rivets, pins), washers, spacers,
insulators, grommets, bushings, springs, wires, and solder are excluded
from the scope of this supplement, see part 744 of the EAR for license
requirements for Russia and Belarus that extend to all items ``subject
to the EAR,'' e.g., Sec. 744.21 of the EAR and the Entity List license
requirements, which in most cases extend to all items ``subject to the
EAR.'' * * *
* * * * *
0
12. Supplement no. 6 to part 746 is amended by adding a sentence to the
end of the introductory text to the supplement to read as follows:
Supplement No. 6 to Part 746--Russian and Belarusian Industry Sector
Sanctions Pursuant to Sec. 746.5(a)(1)(iii)
* * * This supplement does not include any item that meets the
definition of ``medicine'' in Sec. 772.1 of the EAR.
* * * * *
0
13. Supplement no. 7 to part 746 is amended by:
0
a. Adding a sentence following the second sentence of paragraph (a);
and
0
b. Adding in the table, in numerical order, the entry ``852910.''
The additions read as follows:
Supplement No. 7 to Part 746--Items That Require a License Under Sec.
746.6 When Destined to the Temporarily Occupied Crimea Region of
Ukraine, Under Sec. 746.7 When Destined to Iran, and Under Sec. 746.8
When Destined to Russia or Belarus
* * * * *
(a) * * * Although fasteners (e.g., screws, bolts, nuts, nut
plates, studs, inserts, clips, rivets, pins), washers, spacers,
insulators, grommets, bushings, springs, wires, and solder are excluded
from the scope of this supplement, see part 744 of the EAR for license
requirements for Russia and Belarus that extend to all items ``subject
to the EAR,'' e.g., Sec. 744.21 of the EAR and the Entity List license
requirements, which in most cases extend to all items ``subject to the
EAR.'' * * *
* * * * *
------------------------------------------------------------------------
HTS-6 codes HTS description
------------------------------------------------------------------------
* * * * * * *
852910....................... Antennas and antenna reflectors and parts
thereof.
* * * * * * *
------------------------------------------------------------------------
Thea D. Rozman Kendler,
Assistant Secretary for Export Administration.
[FR Doc. 2024-01408 Filed 1-23-24; 8:45 am]
BILLING CODE 3510-33-P
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</html>Indexed from Federal Register on January 25, 2024.
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.