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Rule2026-16078

DPAS Directive Allocation Order and Additional Requirements for Recoverable Critical Minerals and Materials

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Published

August 6, 2026

Effective

August 27, 2026

Issuing agencies

Commerce DepartmentIndustry and Security Bureau

Abstract

The Bureau of Industry and Security ("BIS") is publishing this temporary final rule to restrict the exportation of black mass and tungsten waste and scrap without a license. Specifically, as of August 27, 2026, U.S. persons engaged in the sale of black mass and tungsten waste and scrap must allocate 100 percent of monthly sales to U.S. persons, unless an adjustment or exception is obtained in advance from BIS. This action is taken pursuant to section 101 of the Defense Production Act of 1950, as amended ("DPA" or the "Act"), the Defense Priorities and Allocations System (15 CFR part 700) and Presidential Determination Pursuant to Section 101 of the Defense Production Act of 1950, as Amended, on Recoverable Critical Minerals and Materials, dated July 30, 2026 ("DPA Determination on Recoverable CMMs"), in which the President authorized the Department of Commerce ("Commerce") to address the scarcity of recoverable critical minerals and materials ("CMMs"). BIS invites the public to submit comments on whether any additional sales requirements are necessary or appropriate to promote the national defense.

Full Text

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<title>Federal Register, Volume 91 Issue 150 (Thursday, August 6, 2026)</title>
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[Federal Register Volume 91, Number 150 (Thursday, August 6, 2026)]
[Rules and Regulations]
[Pages 50701-50706]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-16078]

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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR 700

[Docket No. 260804-0143]
0694-AK51

DPAS Directive Allocation Order and Additional Requirements for
Recoverable Critical Minerals and Materials

AGENCY: Bureau of Industry and Security, Department of Commerce.

ACTION: Temporary final rule; Request for comments.

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SUMMARY: The Bureau of Industry and Security (``BIS'') is publishing
this temporary final rule to restrict the exportation of black mass and
tungsten waste and scrap without a license. Specifically, as of August
27, 2026, U.S. persons engaged in the sale of black mass and tungsten
waste and scrap must allocate 100 percent of monthly sales to U.S.
persons, unless an adjustment or exception is obtained in advance from
BIS. This action is taken pursuant to section 101 of the Defense
Production Act of 1950, as amended (``DPA'' or the ``Act''), the
Defense Priorities and Allocations System (15 CFR part 700) and
Presidential Determination Pursuant to Section 101 of the Defense
Production Act of 1950, as Amended, on Recoverable Critical Minerals
and Materials, dated July 30, 2026 (``DPA Determination on Recoverable
CMMs''), in which the President authorized the Department of Commerce
(``Commerce'') to address the scarcity of recoverable critical minerals
and materials (``CMMs''). BIS invites the public to submit comments on
whether any additional sales requirements are necessary or appropriate
to promote the national defense.

DATES: Directive Allocation Order Effective date: August 27, 2026
through August 27, 2027.
Request for Adjustment and Exceptions date: Requests may be
submitted on a rolling basis beginning August 6, 2026 through August
27, 2027.
Comments: Comments must be received by November 4, 2026.

ADDRESSES: Requests for an adjustment or exception may be submitted to
the Department of Commerce, Bureau of Industry and Security, Office of
Strategic Industries and Economic Security via
<a href="/cdn-cgi/l/email-protection#fabeaabba9bb969695999b8e93959489ba989389d49e9599d49d958c">[email&#160;protected]</a>.
Comments regarding this temporary final rule may be submitted to
the Federal rulemaking portal at: <a href="https://www.regulations.gov">https://www.regulations.gov</a>. The
<a href="http://regulations.gov">regulations.gov</a> ID for this notice is BIS-2026-0364. Please refer to
RIN 0694-AK51 in all comments. All filers using the portal should use
the name of the person or entity submitting the comments as the name of
their files, in accordance with the instructions below. Anyone
submitting business confidential information should clearly identify
the business confidential portion at the time of submission, file a
statement justifying nondisclosure and referring to the specific legal
authority claimed, and provide a non-confidential version of the
submission.
For comments submitted electronically containing business
confidential information, the file name of the business confidential
version should begin with the characters ``BC.'' Any page containing
business confidential information must be clearly marked ``BUSINESS
CONFIDENTIAL'' on the top of that page. The corresponding non-
confidential version of those comments must be clearly marked
``PUBLIC.'' The file name of the non-confidential version should begin
with the character ``P.'' Any submissions with file names that do not
begin with either a ``BC'' or a ``P'' will be assumed to be public and
will be made publicly available at: <a href="https://www.regulations.gov">https://www.regulations.gov</a>.
Commenters submitting business confidential information are encouraged
to scan a hard copy of the non-confidential version to create an image
of the file, rather than submitting a digital copy with redactions
applied, to avoid inadvertent redaction errors which could enable the
public to read business confidential information.

FOR FURTHER INFORMATION CONTACT: Emily Noel, Office of Strategic
Industries and Economic Security, Bureau of Industry and Security,
Department of Commerce, Telephone: 202-482-3634; email:
<a href="/cdn-cgi/l/email-protection#5713071604163b3b383436233e38392417353e247933383479303821">[email&#160;protected]</a>.

SUPPLEMENTARY INFORMATION: The preamble to this temporary final rule
consists of four sections:

I. Legal Authorities
II. Provisions of the Temporary Final Rule
III. Request for Comment
IV. Rulemaking Requirements

I. Legal Authorities

BIS administers the DPAS regulation which implements the priorities
and allocations authority under Title I of the DPA (50 U.S.C. 4501, et
seq.), with respect to all materials, services, and facilities,
including construction materials, not delegated to other

[[Page 50702]]

Secretaries under Executive Order (``E.O.'') 13603. These materials,
services, and facilities are referred to as ``industrial resources.''
On July 30, 2026, the President issued DPA Determination on
Recoverable CMMs. Under DPA Determination on Recoverable CMMs, the
President found that certain recoverable CMMs are scarce and critical
materials essential to the national defense. The President stated that
the inadequate supply of CMMs poses an increasing risk to our national
defense and security, and it is imperative that the United States take
immediate action to secure the supply of recoverable CMMs. Accordingly,
pursuant to section 101 of the DPA, the President found that
recoverable CMMs meet the criteria specified in section 101(b) of the
DPA (50 U.S.C. 4511(b)). With these findings, the President authorized
the Secretary of Commerce (``Secretary'') to use the Secretary's
delegated authority under E.O. 13603 of March 12, 2012 (National
Defense Resources Preparedness) to implement this determination by
taking all appropriate action under section 101 of the DPA.

II. Provisions of the Temporary Final Rule

BIS has determined that sales by U.S. persons of certain scarce
materials identified in DPA Determination on Recoverable CMMs shall be
allocated to U.S. persons through an Allocation Order, which are
described in pursuant to Subpart F of Part 700 (DPAS). Consistent with
section 709(b)(2) of the DPA (50 U.S.C. 4559(b)(2)), this Allocation
Order and associated necessary conforming revisions to the DPAS
regulations are published as a temporary final rule because BIS has
determined that urgent and compelling circumstances make compliance
with prior notice and opportunity for public comment impracticable.
This temporary rule is necessary to immediately secure the supply of
certain recoverable CMMs to ensure an adequate supply of these
materials deemed essential to the national defense, as required by the
President under DPA Determination on Recoverable CMMs.
Specifically, BIS is publishing this temporary final rule to
implement a Directive Allocation Order, as described in Sec. 700.33
(Types of allocation orders) in the DPAS. The industrial resources
specified in the Directive Allocation Order may not be exported from
the United States without explicit authorization by BIS. This Directive
Allocation Order and the associated regulatory revisions in this
temporary final rule expire one year from its effective date, unless
adjusted or extended by BIS prior to the expiration date in a Federal
Register publication.

A. Regulatory Revisions

BIS is revising Sec. 700.34 of the DPAS to add new paragraph (d),
to include a provision to issue allocation orders through a temporary
final rule in the Federal Register. In addition, BIS is adding new
supplement no. 1 to part 700 to issue a Directive Allocation Order
pursuant to new paragraph Sec. 700.34(d). The new supplement includes:
<bullet> Information regarding scope and definition of terms that
apply solely to the Directive Allocation Order issued by publication of
this temporary final rule (and not to other provisions within the
DPAS);
<bullet> Adjustment and exceptions requirements for this Directive
Allocation Order issued by a temporary final rule;
<bullet> Additional compliance guidance; and
<bullet> A table that identifies the scarce and critical materials
deemed essential to national defense under DPA Determination on
Recoverable CMMs, identified by 10-digit Schedule B codes and
accompanying description. The table includes the monthly domestic sales
requirement percentage, as well as effective date and expiration date
of this Directive Allocation Order.
The provisions in the supplement apply solely to the Directive
Allocation Order and do not apply to other official actions taken
pursuant to the DPAS. Additionally, BIS is making conforming changes to
Sec. Sec. 700.8 (Definitions) and 700.80 (Adjustments or exceptions)
to include reference to supplement no. 1 to part 700 and the specific
provisions that are exclusively required for allocation orders issued
through a temporary final rule in the Federal Register in new
supplement no. 1 to part 700.

B. Directive Allocation Order Requirements for Black Mass and Tungsten
Waste and Scrap

U.S. persons engaged in the sale of materials described and
identified by Schedule B codes listed in Table 1 of this supplement are
required to comply with this order, in accordance with the provisions
of the Defense Priorities and Allocations System regulation (15 CFR
part 700).
As of August 27, 2026, U.S. persons engaged in the sale of `black
mass' and tungsten waste and scrap, must allocate 100 percent of
monthly sales to U.S. persons, as specified in new supplement no. 1 to
part 700 of the DPAS. For purposes of this Directive Allocation Order,
``black mass'' means any shredded lithium-ion battery scrap that
contains cathode material (which may include lithium, cobalt, nickel
and manganese), anode material (graphite, silicon) or other residual
battery cell materials.
Accordingly, starting August 27, 2026, U.S. persons engaged in the
sale of black mass (Schedule B codes 8549.13.00.00, 8549.14.00.00, and
8549.19.00.00) and tungsten waste and scrap (Schedule B code
8101.97.00.00) must allocate 100 percent of monthly sales to U.S.
persons (referred to as a ``domestic sales requirement''), unless an
exception or adjustment is granted by BIS, as described in Section II.C
of this temporary final rule. The domestic sales requirement for
electrical and electronic waste and scrap: waste and scrap of primary
cells, primary batteries and electric accumulators; spent primary
cells, spent primary batteries and spent electric accumulators: sorted
by chemical type and not containing lead, cadmium or mercury (Schedule
B code 8549.13.00.00); electrical and electronic waste and scrap: waste
and scrap of primary cells, primary batteries and electric
accumulators; spent primary cells, spent primary batteries and spent
electric accumulators: unsorted and not containing lead, cadmium or
mercury (Schedule B code 8549.14.00.00); and electrical and electronic
waste and scrap: waste and scrap of primary cells, primary batteries
and electric accumulators; spent primary cells, spent primary batteries
and spent electric accumulators: other (Schedule B code 8549.19.00.00)
are limited to materials that meet the definition of ``black mass'', as
defined in supplement no. 1 to part 700. Materials under these Schedule
B codes that do not meet this definition of ``black mass'' are not
subject to this Directive Allocation Order.
Therefore, starting August 27, 2026, ``black mass'' (Schedule B
codes 8549.13.00.00, 8549.14.00.00, and 8549.19.00.00) and tungsten
waste and scrap (Schedule B code 8101.97.00.00) must remain physically
located within the United States, unless otherwise authorized by BIS.
U.S. persons must continue to fill DPAS rated orders for covered black
mass and tungsten waste and scrap from U.S. persons in accordance with
the DPAS regulations. In accordance with new Supplement no. 1 to part
700(c), implemented through this temporary final rule, BIS may grant
exceptions or adjustments on a case-by-case basis to allow sales to
non-U.S. persons, notwithstanding the domestic sales requirement.

[[Page 50703]]

C. Authorizations for Adjustments and Exceptions

While Subpart K of the DPAS describes the Adjustments, Exceptions
and Appeals process, U.S. persons who are subject to the domestic sales
requirement for ``black mass'' and tungsten waste and scrap must submit
a request for an adjustment or exception, following the process
described in new supplement no. 1 to part 700(c). BIS may authorize
both company-specific and generally applicable adjustments or
exceptions from the sale requirement at its discretion, consistent with
the determination that the restrictions covered by this rule are
necessary or appropriate to promote the national defense. In addition,
BIS may authorize interim relief--i.e., a DPAS temporary license--while
a request is pending. A DPAS temporary license or other type of
approval which provides authorization from BIS for an adjustment or
exception to this Directive Allocation Order is neither equivalent to
nor replaces licenses or other authorizations to export, reexport, or
transfer (in-country) commodities, technology, or software pursuant to
the Export Administration Regulations (15 CFR parts 730-774). Persons
granted a DPAS license or DPAS temporary license under the Directive
Allocation Order must otherwise adhere to U.S. export control
regulations.
BIS will consider granting adjustments, exceptions, or interim
relief for this Directive Allocation Order for the following scenarios,
among others:
<bullet> The domestic sales requirement results in an undue or
exceptional hardship on that person not suffered generally by others in
similar situations and circumstances.
<bullet> The consequence of complying with the domestic sales
requirement is contrary to the intent of the DPA or this part--for
example, because it would reduce the domestic supply of CMMs.
<bullet> A U.S. person plans to sell black mass and tungsten waste
and scrap to a person located outside the United States for processing
or refining, and then the processed/refined material will be returned
to the United States.
<bullet> Compliance with the domestic sales requirement will result
in irreparable harm to a U.S. person who is subject to the order.
<bullet> Additional time is needed to comply with the domestic
sales requirements.
Requests for adjustments and exceptions must be made in writing and
provided to BIS via <a href="/cdn-cgi/l/email-protection#2165716072604d4d4e424055484e4f52614348520f454e420f464e57">[email&#160;protected]</a>. Each request for
adjustment or exception must contain a complete statement of all the
facts and circumstances related to the domestic sales requirement from
which relief is sought, and a full and precise statement of the reasons
why relief should be provided; and relevant supporting documents or
data to support the request.
The submission of a request for adjustment or exception shall not
relieve any person from the obligation of complying with the domestic
sales requirement while the request is being considered, unless such
interim relief is granted in writing. BIS intends to respond to
requests for adjustment of or exceptions to compliance with the
domestic sales requirement within 14 days of the date of receipt. An
appeal for a decision under this section may be made in accordance with
15 CFR 700.81. For more information regarding adjustments and exception
requests, please refer to 15 CFR 700.80.

D. Compliance and Procedures

Compliance provisions in Subpart J of the DPAS continue to apply.
U.S. persons are required to comply with allocation orders and the
terms of any adjustment or exception authorizations granted, in
accordance with 15 CFR 700.35. Further, in accordance with 15 CFR
700.90, section 707 of the DPA (50 U.S.C. 4557), and to the fullest
extent consistent with applicable law, a person shall not be held
liable for damages or penalties for any act or failure to act resulting
directly or indirectly from compliance with the DPAS regulation, or
this Directive Allocation Order, notwithstanding that such provision or
action shall subsequently be declared invalid by judicial or other
competent authority.
If a U.S. person is unable to comply fully with the required
action(s) specified in an allocation order, the U.S. person must notify
BIS immediately in writing, explain the extent to which compliance is
possible, and give the reasons why full compliance is not possible.
Written notification must be provided to BIS via
<a href="/cdn-cgi/l/email-protection#4004100113012c2c2f232134292f2e33002229336e242f236e272f36">[email&#160;protected]</a>. If notification is given verbally to BIS
via 202-482-3634, written or electronic confirmation must be provided
to BIS within one working day via <a href="/cdn-cgi/l/email-protection#6723372634260b0b080406130e08091427050e144903080449000811">[email&#160;protected]</a>. Such
notification does not release the U.S. person from complying with the
order to the fullest extent possible, until the U.S. person is notified
by BIS that the order has been changed or cancelled.
BIS will implement this temporary final rule with the cooperation
and assistance of other U.S. Government agencies, including U.S.
Customs and Border Protection (CBP). Any covered materials intended for
export may be detained by CBP while BIS conducts its review of the
shipment. BIS will review the shipment and provide notification as soon
as possible regarding the disposition of the covered materials under
this Directive Allocation Order, provided that any goods that have been
detained by CBP and are subsequently made subject to a DPAS rated order
will be consigned to BIS pending further distribution or agency
direction. BIS may provide additional guidance regarding the
application of any exemptions to this temporary final rule, as
appropriate.
BIS may conduct investigations and issue requests for information
as may be necessary for the enforcement of the Act, the DPAS
regulations, and this Directive Allocation Order. See 15 CFR 700.71;
see also section 705 of the Act, 50 U.S.C. 4555. BIS may also seek an
injunction or other order in accordance with 15 CFR 700.74(b). See also
section 706 of the Act, 50 U.S.C. 4556. In addition to an injunction,
failure to comply fully with this temporary final rule is punishable in
accordance with 15 CFR 700.74(a). See also sections 103 and 705 of the
Act, 50 U.S.C. 4513 and 4555.
At any point in time, and to the extent consistent with United
States policy, BIS may determine that additional materials identified
in DPA Determination on Recoverable CMMs be subject to an allocation
order. BIS may add additional materials to this Directive Allocation
Order and will provide notification of this decision through
publication in the Federal Register.

III. Request for Comments

While this temporary final rule is effective on publication, BIS
requests comments on whether any additional sales requirements are
necessary or appropriate to promote the national defense. In addition,
BIS also welcomes comments on the framework of the temporary regulatory
provisions added to the DPAS.

IV. Rulemaking Requirements

1. Executive Orders 13563 and 12866 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). Executive
Order 13563 emphasizes the importance of

[[Page 50704]]

quantifying both costs and benefits, of reducing costs, of harmonizing
rules, and of promoting flexibility. This temporary final rule has been
determined to be a ``significant regulatory action,'' although not
economically significant, under section 3(f) of Executive Order 12866.
This temporary final rule is exempt from Executive Order 14192 because
it is being issued with respect to a national security function of the
United States.
2. This rule does not contain policies with Federalism implications
as that term is defined in Executive Order 13132.
3. This rule is exempt from the Administrative Procedures Act (APA)
(See 5 U.S.C. 553) and is published as a temporary rule with immediate
effective date. Agency rulemaking is generally governed by the agency
rulemaking provisions of the APA and such provisions generally require
that, unless the rule falls within one of a number of enumerated
exceptions, or unless another statute exempts the rulemaking from the
requirements of the APA, BIS must publish a notice of proposed
rulemaking in the Federal Register that provides interested persons an
opportunity to submit written data, views, or arguments, prior to
finalization of regulatory requirements.
Pursuant to section 709(a) of the Act, 50 U.S.C. 4559(a), this rule
is exempt from the rulemaking provisions of the APA, sections 5 U.S.C.
551-559. While section 709(b)(1) of the Act, 50 U.S.C. 4559(b)(1)
requires agencies to promulgate regulations under that section by
providing notice and opportunity for public comment ``consistent with
section 553(b)'', section 709(b)(2) directs agencies to waive the
requirements of 5 U.S.C. 553(b) if (A) the officer authorized to issue
the regulation finds that urgent and compelling circumstances make
compliance with such requirements impracticable; (B) the regulation is
issued on a temporary basis; and (C) the publication of such temporary
regulation is accompanied by the finding made under subparagraph (A)
(and a brief statement of the reasons for such finding) and an
opportunity for public comment is provided for not less than 30 days
before any regulation becomes final. Based on the findings in DPA
Determination on Recoverable CMMs, which already have been summarized
in this document, the Under Secretary for Industry and Security has
determined ``that urgent and compelling circumstances make compliance''
with the notice and comment requirements of section 709(b)(1) of the
Act, 50 U.S.C. 4559(b)(1), ``impracticable.'' An opportunity for public
comment is being provided now for a period of 90 days, which shall
ensure that a minimum 30-day public comment period is provided before
any provisions of this temporary final rule ``become final,'' i.e.
without an expiration date, pursuant to section 709(b)(2)(C) of the
Act, 50 U.S.C. 4559(b)(2)(C).
America's inadequate supply of CMMs poses an increasing risk to our
national defense and security. The United States relies heavily on
imports of certain CMMs commodities from foreign sources, and this
reliance threatens serious, sustained supply chain disruptions. It is
imperative that the United States take immediate action to secure the
supply of recoverable CMMs by allocating a percentage of sales of
specific recoverable CMMs to U.S. persons.
The measures described in this rule are being issued on a temporary
basis. This temporary rule will cease to be in effect on August 27,
2027.
4. Because a notice of proposed rulemaking and an opportunity for
public comment are not required to be given for this rule under the APA
(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.
5. The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.)
provides that an agency generally cannot conduct or sponsor a
collection of information, and no person is required to respond to nor
be subject to a penalty for failure to comply with a collection of
information, unless that collection has obtained Office of Management
and Budget (OMB) approval and displays a currently valid OMB Control
Number.
On July 30, 2026, the President issued a Presidential Determination
titled ``Presidential Determination Pursuant to Section 101 of the
Defense Production Act of 1950, as Amended, on Recoverable Critical
Minerals and Materials'' (``DPA Determination on Recoverable CMMs'').
Under DPA Determination on Recoverable CMMs, the President found that
recoverable critical minerals and materials (CMMs) are scarce and
critical materials essential to the national defense, meeting the
criteria specified in section 101(b) of the DPA (50 U.S.C. 4501, et
seq.). Per DPA Determination on Recoverable CMMs, the President found
that America's inadequate supply of CMMs poses an increasing risk to
our national defense and security and directed the Secretary to take
immediate action to secure the supply of recoverable CMMs.
BIS cannot reasonably comply with the normal PRA clearance process
as a delay in BIS's ability to begin immediate information collection
from companies engaged in the sale of recoverable CMMs to ensure a
continued and adequate supply of these items, which are scarce and
critical materials essential to the national defense. The Department
has determined the following conditions have been met:
a. The collection of information is needed prior to the expiration
of time periods normally associated with a routine submission for
review under the provisions of the Paperwork Reduction Act in view of
DPA Determination on Recoverable CMMs, <a href="https://www.whitehouse.gov/presidential-actions/2026/07/presidential-determination-pursuant-to-section-101-of-the-defense-production-act-of-1950-as-amended-on-recoverable-critical-minerals-and-materials/">https://www.whitehouse.gov/presidential-actions/2026/07/presidential-determination-pursuant-to-section-101-of-the-defense-production-act-of-1950-as-amended-on-recoverable-critical-minerals-and-materials/</a>.
b. The collection of information is essential to the mission of the
Department, in particular to promote the national defense; and to
allocate materials, services, and facilities in such a manner, upon
such conditions, and to such extent as the President shall deem
necessary or appropriate to promote the national defense, as defined in
the DPA.
c. Public harm is reasonably likely to result if BIS were to follow
the normal clearance procedures before issuing this information
collection. A delay in BIS's ability to begin immediate information
collection from companies engaged in the sale of recoverable CMMs will
lead to increased scarcity of these materials through additional
exports, posing an imminent threat to U.S. military readiness and
critical infrastructure sectors. BIS is required to issue official
actions under the DPAS regulation and collect certain critical
information from companies engaged in the sale of recoverable CMMs to
effectuate DPA Determination on Recoverable CMMs and ensure compliance
with the DPAS regulation and the official actions issued, as described
in sections 700.80, 700.81, and 700.91 of the DPAS regulation. These
collection requirements may include buyer information, the applicable
material and Schedule B code, quantity of material, and value of the
sale. BIS may issue additional allocation orders as required to meet
the objectives of DPA Determination on Recoverable CMMs.
For the reasons stated above, BIS has requested, and OMB has
granted, a new information collection for this rule under OMB control
number 0694-0148

[[Page 50705]]

with the title Directive Allocation Orders under the Defense Priorities
and Allocations System in Response to Presidential Determination on
Recoverable Critical Minerals and Materials. All materials for the
currently approved collection can be accessed at <a href="http://www.reginfo.gov">www.reginfo.gov</a>.
Separately, BIS will be publishing a 60 day notice to take comment on
the emergency collection.

List of Subjects in 15 CFR Part 700

Administrative practice and procedure, Business and industry,
Government contracts, National defense, Reporting and recordkeeping
requirements, Strategic and critical materials.

For the reasons set forth in the preamble, part 700 of subchapter A
of 15 CFR chapter VII is amended as follows:

PART 700--DEFENSE PRIORITIES AND ALLOCATIONS SYSTEM

0
1. The authority citation continues to read as follows:

Authority: 50 U.S.C. 4501 et seq.; 42 U.S.C. 5195, et seq.; 50
U.S.C. 3816; 10 U.S.C. 2538; 50 U.S.C. 82; E.O. 12656, 53 FR 226, 3
CFR, 1988 Comp., p. 585; E.O. 12742, 56 FR 1079, 3 CFR, 1991 Comp.,
p. 309; E.O. 13603, 77 FR 16651, 3 CFR, 2012 Comp., p. 225.

0
2. Section 700.8 is amended by revising the definition of ``person'' to
read as follows:

Sec. 700.8 Definitions.

* * * * *
Person. Any individual, corporation, partnership, association, or
any other organized group of persons, or legal successor or
representative thereof; or any authorized State or local government or
agency thereof; and for purposes of administration of this part,
includes the United States Government and any authorized foreign
government or international organization or agency thereof, delegated
authority as provided in this part (for Directive Allocation Orders
issued by a temporary final rule, see supplement no. 1 to part 700,
paragraph (b).
* * * * *

0
3. Revise Sec. 700.34 to read as follows:

Sec. 700.34 Elements of an allocation order.

Allocation orders may be issued directly to the affected persons,
by constructive notice to the parties through publication in the
Federal Register, or by the publication of a temporary final rule in
the Federal Register. This section describes the elements that each
order must include.
(a) Elements to be included in all allocation orders. (1) A
detailed description of the required allocation action(s), including
its relationship to previously or subsequently received DX rated
orders, DO rated orders, and unrated orders.
(2) Specific start and end calendar dates for each required
allocation action.
(b) Elements to be included in orders issued directly to affected
persons. (1) A statement that reads in substance: ``This is an
allocation order certified for national defense use. [Insert the name
of the person receiving the order] is required to comply with this
order, in accordance with the provisions of the Defense Priorities and
Allocations System regulation (15 CFR part 700).''
(2) The written signature on a manually placed order, or the
digital signature or name on an electronically placed order, of an
authorized official or employee of the Department of Commerce.
(c) Elements to be included in an allocation order issued by
constructive notice through publication in the Federal Register. (1) A
statement that reads in substance: ``This is an allocation order
certified for national defense use. [Insert the name(s) of the
person(s) to whom the order applies or a description of the class of
persons to whom the order applies] is (are) required to comply with
this order, in accordance with the provisions of the Defense Priorities
and Allocations System regulation (15 CFR part 700).''
(2) The order must be signed by an authorized official or employee
of the Department of Commerce.
(d) Elements to include in an allocation order issued by
publication of a temporary final rule in the Federal Register in
supplement no. 1 to part 700. (1) A statement/temporary final rule that
reads in substance: ``This is an allocation order certified for
national defense use. [Insert the name(s) of the person(s) to whom the
order applies or a description of the class of persons to whom the
order applies] is (are) required to comply with this order, in
accordance with the provisions of the Defense Priorities and
Allocations System regulation (15 CFR part 700).''
(2) The order must be signed by an authorized official or employee
of the Department of Commerce.
(3) The temporary final rule will include:
(i) A statement of the specific objective(s) of the allocation
order;
(ii) A list of the materials, services, and/or facilities to be
allocated;
(iii) A list or description of the sources of the materials,
services, or facilities subject to the allocation order; and
(iv) A detailed description of the provisions that will be included
in the allocation order, including the type of allocation order, the
percentages or quantity to be allocated, the relationship with
previously or subsequently received priority rated and unrated
contracts and orders, and the duration of the allocation order (e.g.,
anticipated start and end dates).

0
4. Amend Sec. 700.80 by adding introductory text to read as follows:

Sec. 700.80 Adjustments or exceptions.

The adjustments or exceptions described in this section apply to
this part and official actions issued under this part, except for
Directive Allocation Orders issued by a temporary final rule. The
adjustment or exception process for Directive Allocation Orders issued
by a temporary final rule are contained in each Directive Allocation
Order, see supplement no. 1 to part 700, paragraph (c).
* * * * *

0
5. Supplement no. 1 to part 700 is added to read as follows:

Supplement No. 1 to Part 700--Directive Allocation Order and Additional
Requirements for Recoverable Critical Minerals and Materials

(a) Scope. This is a Directive Allocation Order certified for
national defense use. U.S. persons engaged in the sale of materials
described and identified by Schedule B codes listed in Table 1 of
this supplement are required to comply with this order, in
accordance with the provisions of the Defense Priorities and
Allocations System regulation (15 CFR Part 700). U.S. persons
engaged in the sale of such materials must allocate the listed
monthly sales requirement percent to U.S. persons, as specified in
Table 1. The effective dates of the Directive Allocation Order are
listed in Table 1 to this supplement. U.S. persons subject to this
Directive Allocation Order are required to comply with this order,
in accordance with the provisions of this part (15 CFR Part 700).
This Directive Allocation Order applies to rated orders and unrated
orders. U.S. persons must continue to fill rated orders for black
mass (Schedule B codes 8549.13.00.00, 8549.14.00.00, and
8549.19.00.00) and tungsten waste and scrap (Schedule B code
8101.97.00.00) from U.S. persons in accordance with this part.
(b) Definitions. The definitions in this paragraph apply to this
supplement only. In the case where a term is defined in both Sec.
700.8 and (b) of this supplement, the definition in (b) of this
supplement supersedes the definition in Sec. 700.8.
``Black mass'' means any shredded lithium-ion battery scrap that
contains cathode material (which may include aluminum, copper, iron,
lithium, cobalt, nickel, and

[[Page 50706]]

manganese), anode material (graphite, silicon) or other residual
battery cell materials.
``Person'' means any individual, corporation, partnership,
association, or any other organized group of persons, or legal
successor or representative thereof.
``Sale'' means transactions in any state, territory, or
possession of the United States, in accordance with 15 CFR
700.92(a), and deliveries to other persons, including deliveries to
affiliates and subsidiaries of a person and deliveries from one
branch, division, or section of a single entity to another branch,
division, or section under common ownership or control, as described
in 15 CFR 700.92(b).
``United States'' means any state, territory, possession of the
United States, and the District of Columbia.
``U.S. person'' means any individual, corporation, partnership,
association, or any other organized group of persons, or legal
successor or representative thereof located in the United States.
(c) Authorizations for Adjustments and Exceptions. For purposes
of the Directive Allocation Order, U.S. persons who are subject to
the Directive Allocation Order may submit a request for an
adjustment or exception. BIS may authorize both company-specific and
generally applicable adjustments or exceptions--i.e., a DPAS
license--from the domestic sale requirement at its discretion,
consistent with the determination that the restrictions covered by
this rule are necessary or appropriate to promote the national
defense. In addition, BIS may authorize interim relief--i.e., a DPAS
temporary license--while a request is pending. For purposes of this
Directive Allocation Order, U.S. persons who are subject to the
domestic sales requirement may submit a request to BIS, for an
adjustment or exception on the grounds that, among others:
(1) The domestic sales requirement results in an undue or
exceptional hardship on that person not suffered generally by others
in similar situations and circumstances.
(2) The consequence of complying with the domestic sales
requirement is contrary to the intent of the DPA or this part--for
example, because it would reduce the domestic supply of CMMs.
(3) A U.S. person plans to sell black mass and tungsten waste
and scrap to a person located outside the United States for
processing or refining, and then the processed/refined material will
be returned to the United States.
(4) Compliance with the domestic sales requirement will result
in irreparable harm to a U.S. person who is subject to the order.
(5) Additional time is needed to comply with the domestic sales
requirements.
Requests for adjustments and exceptions must be made in writing
and provided to BIS via email at <a href="/cdn-cgi/l/email-protection#6024302133210c0c0f030114090f0e13200209134e040f034e070f16">[email&#160;protected]</a>. Each
request for adjustment or exception must contain a complete
statement of all the facts and circumstances related to the domestic
sales requirement from which relief is sought, a full and precise
statement of the reasons why relief should be provided; and relevant
supporting documents or data to support the request.
The submission of a request for adjustment or exception shall
not relieve any U.S. person from the obligation of complying with
the provisions the Directive Allocation Order in while the request
is being considered unless such interim relief is granted in writing
by BIS. BIS intends to respond to requests for adjustment of or
exceptions to compliance within fourteen (14) days, but in any
event, responses to requests will be consistent with section 700.80.
If an adjustment or exception is authorized by BIS, BIS will
provide to the requestor a DPAS authorization, in writing, which
will specify the Schedule B codes the adjustment or exception
applies to, the adjustment or exception terms (which may include the
quantity or volume authorized), and the period of validity of the
adjustment or exception. The requester must comply with the terms
specified in the authorization.
A DPAS authorization granted for a Directive Allocation Order
adjustment or exception is neither equivalent to, nor replaces,
licenses or other authorizations to export, re-export, or transfer
(in-country) commodities, technology, or software pursuant to the
Export Administration Regulations (15 CFR parts 730-774). U.S.
persons granted a DPAS authorization must otherwise adhere to U.S.
export control regulations.
A decision may be appealed to the Assistant Secretary for Export
Administration. (For information on the appeal procedure, see Sec.
700.81.)
(d) Compliance. U.S. persons are required to comply with the
Directive Allocation Order and the terms of any adjustment or
exception granted, in accordance with 15 CFR 700.35. Subparts J and
L continue to apply.

Table 1--Directive Allocation Order Domestic Sales Requirements
--------------------------------------------------------------------------------------------------------------------------------------------------------
Monthly sales
Schedule B code Description requirement Effective date Expiration date
(%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
8101.97.00.00....................... Tungsten Waste and Scrap........................ 100 August 27, 2026........ August 27, 2027.
8549.13.00.00....................... Electrical and electronic waste and scrap: waste 100 August 27, 2026........ August 27, 2027.
and scrap of primary cells, primary batteries
and electric accumulators; spent primary cells,
spent primary batteries and spent electric
accumulators: sorted by chemical type and not
containing lead, cadmium or mercury. Sales
requirement only applies if the waste and scrap
meet the definition of black mass, as described
in Section II.B.
8549.14.00.00....................... Electrical and electronic waste and scrap: waste 100 August 27, 2026........ August 27, 2027.
and scrap of primary cells, primary batteries
and electric accumulators; spent primary cells,
spent primary batteries and spent electric
accumulators: unsorted and not containing lead,
cadmium or mercury. Sales requirement only
applies if the waste and scrap meet the
definition of black mass, as described in
Section II.B.
8549.19.00.00....................... Electrical and electronic waste and scrap of 100 August 27, 2026........ August 27, 2027.
primary cells, primary batteries and electric
accumulators; spent primary cells, primary
batteries and electric accumulators: other.
Sales requirement only applies if the waste and
scrap meet the definition of black mass, as
described in Section II.B.
--------------------------------------------------------------------------------------------------------------------------------------------------------

Jessica Curyto,
Deputy Assistant Secretary for Technology Security.
[FR Doc. 2026-16078 Filed 8-4-26; 4:15 pm]
BILLING CODE 3510-33-P

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