Rossiya Airlines, Pilotov St 18-4, St. Petersburg, Russia, 196210; Order Renewing Temporary Denial of Export Privileges

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November 8, 2024

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Commerce DepartmentIndustry and Security Bureau

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<title>Federal Register, Volume 89 Issue 217 (Friday, November 8, 2024)</title>
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[Federal Register Volume 89, Number 217 (Friday, November 8, 2024)]
[Notices]
[Pages 88721-88724]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-25983]

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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

Rossiya Airlines, Pilotov St 18-4, St. Petersburg, Russia,
196210; Order Renewing Temporary Denial of Export Privileges

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 in this
matter on November 8, 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 Rossiya Airlines (``Rossiya'') has engaged in a pattern of
repeated, ongoing and/or continuous apparent violations of the EAR.
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\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. sec.
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superseded, set aside, or revoked through action undertaken pursuant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).

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[[Page 88722]]

I. Procedural History

On May 20, 2022, I signed an order denying Rossiya'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\ The TDO was subsequently renewed on November 15, 2022,\3\
May 12, 2023,\4\ and again on November 8 2023 \5\ in accordance with
section 766.24(d) of the Regulations.\6\
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\2\ The TDO was published in the Federal Register on May 25,
2022 (87 FR 31856).
\3\ The November 15, 2022 renewal order was published in the
Federal Register on November 21, 2022 (87 FR 70780).
\4\ The May 12, 2023 renewal order was published in the Federal
Register on May 17, 2023 (88 FR 31483).
\5\ The November 8, 2023 renewal order was published in the
Federal Register on November 14, 2023 (88 FR 77952).
\6\ 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.
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On October 17, 2024, BIS, through OEE, submitted a written request
for a fourth renewal of the TDO. 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 Rossiya 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 CFR
766.24(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.'' \7\ Id.
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\7\ 88 FR 59791 (Aug. 30, 2023).
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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).\8\ 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).\9\ 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.
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\8\ 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).
\9\ 87 FR 13048 (Mar. 8, 2022).
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OEE's request for renewal for a period of one year is based upon
the facts underlying the issuance of the initial TDO and the renewal
orders subsequently issued in this matter on November 15, 2022, May 12,
2023, and November 8, 2023, as well as other evidence developed during
this investigation. This evidence demonstrates that Rossiya 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 May 20, 2022, was based on evidence that Rossiya
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, Hurghada, Egypt; Sharm el-Sheikh, Egypt; Dubai,
United Arab Emirates; and Sharjah, United Arab Emirates, without the
required BIS authorization.\10\ Further evidence indicated that Rossiya
also operated aircraft subject to the EAR domestically on flights
within Russia, potentially in violation of section 736.2(b)(10) of the
Regulations.
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\10\ Publicly available flight tracking information shows that
on March 8, 2022, serial number (SN) 27650 flew from Hurghada, Egypt
to Moscow, Russia. On March 6, 2022, SN 41212 flew from Sharm el-
Sheikh, Egypt to St. Petersburg, Russia. In addition, on March 6,
2022, SN 44435 flew from Dubai, United Arab Emirates to St.
Petersburg, Russia. Similarly, on March 7, 2022, SN 41202 flew from
Sharjah, United Arab Emirates to Moscow, Russia.
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As discussed in the prior renewal orders, BIS presented evidence
indicating that, after the initial TDO issued, Rossiya 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 Regulations
and the TDO itself.\11\ The November 15, 2022 renewal order detailed
flights into and out of Russia from/to Antalya and Istanbul, Turkey, as
well as within Russia.\12\ The May 12,

[[Page 88723]]

2023 renewal order detailed flights into and out of Russia from/to
Hurghada and Sharm el-Sheikh, Egypt and Istanbul, Turkey.\13\
Similarly, the November 8, 2023 renewal order detailed flights into and
out of Russia from/to Bishkek, Kyrgyzstan, Samarkand, Uzbekistan, and
Hurghada and Sharm el-Sheikh, Egypt.\14\
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\11\ Engaging in conduct prohibited by a denial order violates
the Regulations. 15 CFR 764.2(a) and (k).
\12\ Publicly available flight tracking information shows that
SN 35278 flew from Antalya, Turkey to Moscow, Russia on November 12,
2022 and from Kaliningrad, Russia to Moscow, Russia on September 29,
2022. In addition, SN 33622 flew from Istanbul, Turkey to St.
Petersburg, Russia on November 2, 2022 and from Krasnoyarsk, Russia
to Irkutsk, Russia on November 5, 2022.
\13\ Publicly available flight tracking information shows that
SN 34900 flew from Sharm el-Sheikh, Egypt to Moscow, Russia on March
20, 2023. Additionally, SN 34897 flew from Istanbul, Turkey to
Moscow, Russia on March 16, 2023 and SN 28515 flew from Magadan,
Russia to Anadyr, Russia on April 25, 2023.
\14\ Publicly available flight tracking information shows that
SN 34900 flew from Bishkek, Kyrgyzstan to Krasnoyarsk, Russia on
November 3, 2023 and from Sharm el-Sheikh, Egypt to Moscow, Russia
on September 21, 2023. In addition, SN 35278 flew from Samarkand,
Uzbekistan to St. Petersburg, Russia on August 4, 2023. On November
1 to November 2, 2023, SN 34897 flew from Hurghada, Egypt to Samara,
Russia.
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Since that time, Rossiya has continued to engage in conduct
prohibited by the applicable TDO and Regulations. In its October 17,
2024 request for renewal of the TDO, BIS submitted evidence that
Rossiya 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 November 8, 2023 renewal order and/or the Regulations.
Specifically, BIS's evidence and related investigation demonstrates
that Rossiya continued to operate aircraft subject to the EAR,
including, but not limited to, on flights into and out of Russia from/
to Sanya, China and Bishkek, Kyrgyzstan, as well as domestically within
Russia. Information about those flights includes, but is not limited
to, the following:

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Departure/arrival
Tail No. Serial No. Aircraft type cities Dates
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RA-73188......................... 34900 737-8GJ............ Yekaterinburg, RU/ October 28, 2024.
Moscow, RU.
RA-73188......................... 34900 737-8GJ............ Sanya, CN/ October 18, 2024.
Krasnoyarsk, RU.
RA-73188......................... 34900 737-8GJ............ Krasnoyarsk, RU/ October 7, 2024.
Vladivostok, RU.
RA-73188......................... 34900 737-8GJ............ Sanya, CN/ October 6, 2024.
Krasnoyarsk, RU.
RA-73188......................... 34900 737-8GJ............ Bishkek, KG/ October 2, 2024.
Krasnoyarsk, RU.
RA-73192......................... 34897 737-8GJ............ Makhachkala, RU/ October 27, 2024.
Moscow, RU.
RA-73192......................... 34897 737-8GJ............ Mineralnye Vody, RU/ October 14, 2024.
St. Petersburg, RU.
RA-73192......................... 34897 737-8GJ............ Moscow, RU/St. October 6, 2024.
Petersburg, RU.
RA-73192......................... 34897 737-8GJ............ Sanya, CN/ October 1, 2024.
Krasnoyarsk, RU.
RA-73192......................... 34897 737-8GJ............ Bishkek, KG/ August 28, 2024.
Krasnoyarsk, RU.
RA-73292......................... 28531 777-312............ Yuzhno-Sakhalinsk, September 17, 2024.
RU/Moscow, RU.
RA-73292......................... 28531 777-312............ Moscow, RU/Anadyr, September 15, 2024.
RU.
RA-73292......................... 28531 777-312............ Khabarovsk, RU/ September 2, 2024.
Moscow, RU.
RA-73292......................... 28531 777-312............ Magadan, RU/Moscow, August 28, 2024.
RU.
RA-73292......................... 28531 777-312............ Blagoveshchensk, RU/ August 25, 2024.
Moscow, RU.
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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 demonstrates that Rossiya has acted in
violation of the Regulations and the TDO; that such violations have
been significant, deliberate; 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 Rossiya 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 Rossiya, 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, Rossiya Airlines, Pilotov St 18-4, St. Petersburg, Russia,
196210, 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:
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
Rossiya 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 Rossiya 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 Rossiya acquires or attempts to acquire such
ownership, possession or control except directly related to safety of
flight and authorized

[[Page 88724]]

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 Rossiya 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 Rossiya 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 Rossiya, or service any item, of
whatever origin, that is owned, possessed or controlled by Rossiya 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 Rossiya 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,
Rossiya 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 Rossiya 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 Rossiya 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. 2024-25983 Filed 11-7-24; 8:45 am]
BILLING CODE 3510-DT-P

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