[Federal Register: August 29, 2005 (Volume 70, Number 166)]
[Rules and Regulations]
[Page 50958-50966]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr29au05-5]
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DEPARTMENT OF STATE
22 CFR Parts 120, 122, 123, 124, 126, and 127
[Public Notice 5176]
Amendments to the International Traffic in Arms Regulations: Port
Directors Definition, NATO Definition, Major Non-NATO Ally Definition,
Recordkeeping Requirements, Supporting Documentation for Electronic
License Applications, Disclosure of Registration Documents
AGENCY: Department of State.
ACTION: Final rule.
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SUMMARY: The definition of ``District Director of Customs'' has been
amended to reflect the change in title. Also, references to the Customs
Service have been changed to the U.S. Customs and Border Protection. A
definition has been added for the ``North Atlantic Treaty
Organization'' and another definition for ``major non-NATO ally.'' The
recordkeeping requirement has been revised to include maintaining
records in an electronic format and reproduction of readable documents.
No need for multiple copies of supporting documentation for electronic
license applications. Also, registration documents are not releasable
to the public.
DATES: Effective Date: This rule is effective August 29, 2005.
ADDRESSES: Interested parties are invited to submit written comments to
the Department of State:
E-mail comments may be sent to DDTCResponseTeam@state.gov
with the subject line: Parts 120, 122, 123, 124, 126 and 127.
Written comments may be sent to Directorate of Defense
Trade Controls, Office of Defense Trade Controls Management, ATTN:
Regulatory Change, Parts 120, 122, 123, 124, 126 and 127, SA-1, 12th
Floor, Washington, DC 20522-0112.
Persons with access to the Internet may also view this notice by
going to the regulations.gov Web site at: http://www.regulations.gov.
Comments will be accepted at any time.
FOR FURTHER INFORMATION CONTACT: Mary F. Sweeney, Office of Defense
Trade Controls Management, Bureau of Political-Military Affairs,
Department of State on 202-663-2865.
SUPPLEMENTARY INFORMATION: The definition of ``District Director of
Customs'' has been amended to reflect that references to ``District
Directors,'' have been replaced with ``Port Directors'' (Sections
123.4, 123.5, 123.6, 123.13, 123.16, 123.17, 123.18, 123.23, 126.4,
126.5, 126.6, and 126.13). Also, references to the ``Bureau of Customs
and Border Protection'' and ``U.S. Customs'' have been replaced by
``U.S. Customs and Border Protection'' (Sections 122.5, 123.4, 123.5,
123.6, 123.13, 123.16, 123.17, 123.18, 123.22, 123.23, 123.24, 124.3,
126.4, 126.5, 126.6, 126.13, and 127.4).
The ITAR has been amended by adding two new definitions. There is a
definition at 22 CFR 120.31 for the ``North Atlantic Treaty
Organization'' and the countries are listed. The other definition is at
22 CFR 120.32 for ``major non-NATO ally.'' Major non-NATO ally means a
country that is designated in accordance with Sec. 517 of the Foreign
Assistance Act of 1961 (22 U.S.C. 2321k) as a major non-NATO ally for
purposes of the Foreign Assistance Act of 1961 and the Arms Export
Control Act (22 U.S.C. 2751 et seq.) (22 U.S.C. 2403(q)). The countries
are listed in 22 CFR 120.32. Also, Taiwan shall be treated as though it
were designated a major non-NATO ally (as defined in section 644(q) of
the Foreign Assistance Act of 1961 (22 U.S.C. 2403(q)) in accordance
with section 1206 of the Foreign Relations Authorization Act, Fiscal
Year 2003 (Pub. L. 107-228). In complying with Presidential
Determination No. 2004-35 of June 3, 2004 and Presidential
Determination No. 2004-37 of June 16, 2004, the ITAR is being amended
to add Morocco and Pakistan as major non-NATO allies of the United
States.
Section 122.3 has been amended to require a registrant renewing its
registration to submit the renewal request at least 30 days prior to
the expiration date.
Section 122.5 has been amended to include if maintaining records in
an electronic format the information must be capable of being
reproduced legibly on paper. Also, the stored information if altered
must keep track of all changes,
[[Page 50959]]
who made them and when they were made.
Section 123.1 has been revised to address if submitting fully
electronic license applications that there is no need for multiple
copies of supporting documentation.
Section 126.10 regarding disclosure of information has been amended
to include that registration documents may not generally be disclosed
to the public under Section 38(e) of the Arms Export Control Act.
Section 127.4 has been revised to address the authority of U.S.
Immigration and Customs Enforcement and U.S. Customs and Border
Protection officers.
Certain references to the ``Office of Defense Trade Controls'' were
changed to the ``Directorate of Defense Trade Controls'' (Sections
122.5, 123.1, 123.4, 123.5, 123.16, 126.4, 126.5, 126.6 and 126.13).
Regulatory Analysis and Notices
This amendment involves a foreign affairs function of the United
States and, therefore, is not subject to the procedures required by 5
U.S.C. 553 and 554. It is exempt from review under Executive Order
12866 but has been reviewed internally by the Department to ensure
consistency with the purposes thereof. This rule does not require
analysis under the Regulatory Flexibility Act or the Unfunded Mandates
Reform Act. It has been found not to be a major rule within the meaning
of the Small Business Regulatory Enforcement Act of 1996. It will not
have substantial direct effects on the States, the relationship between
the National Government and the States, or on the distribution of power
and responsibilities among the various levels of government. Therefore,
it is determined that this rule does not have sufficient federalism
implications to warrant application of consultation provisions of
Executive Orders 12372 and 13132. This rule does not impose any new
reporting or recordkeeping requirements subject to the Paperwork
Reduction Act, 44 U.S.C. Chapter 35.
List of Subjects
22 CFR Part 120
Arms and munitions, Classified information, Exports.
22 CFR Part 122
Arms and munitions, Exports, Reporting and recordkeeping
requirements.
22 CFR Parts 123 and 126
Arms and munitions, Exports.
22 CFR Part 124
Arms and munitions, Exports, Technical assistance.
22 CFR Part 127
Arms and munitions, Crime, Exports, Penalties, Seizures and
forfeitures.
0
Accordingly, for the reasons set forth above, title 22, chapter I,
subchapter M, parts 120, 122, 123, 124, 126, and 127 are amended as
follows:
PART 120--PURPOSE AND DEFINITIONS
0
1-2. The authority citation for part 120 continues to read as follows:
Authority: Secs. 2, 38, and 71, Public Law 90-629, 90 Stat. 744
(22 U.S.C. 2752, 2778, 2797); 22 U.S.C. 2794; E.O. 11958, 42 FR
4311; 3 CFR, 1977 Comp. p. 79; 22 U.S.C. 2651a; Pub. L 105-261, 112
Stat. 1920.
0
3. Section 120.24 is revised to read as follows:
Sec. 120.24 Port Directors.
Port Directors of U.S. Customs and Border Protection means the U.S.
Customs and Border Protection Port Directors at the U.S. Customs and
Border Protection Ports of Entry (other than the port of New York, New
York where their title is the Area Directors).
0
4. Section 120.31 is added to read as follows:
Sec. 120.31 North Atlantic Treaty Organization.
North Atlantic Treaty Organization (NATO) is comprised of the
following member countries: Belgium, Bulgaria, Canada, Czech Republic,
Denmark, Estonia, France, Germany, Greece, Hungary, Iceland, Italy,
Latvia, Lithuania, Luxembourg, The Netherlands, Norway, Poland,
Portugal, Romania, Slovakia, Slovenia, Spain, Turkey, United Kingdom
and the United States.
0
5. Section 120.32 is added to read as follows:
Sec. 120.32 Major non-NATO ally.
Major non-NATO ally means a country that is designated in
accordance with Sec. 517 of the Foreign Assistance Act of 1961 (22
U.S.C. 2321k) as a major non-NATO ally for purposes of the Foreign
Assistance Act of 1961 and the Arms Export Control Act (22 U.S.C. 2751
et seq.) (22 U.S.C. 2403(q)). The following countries have been
designated as major non-NATO allies: Argentina, Australia, Bahrain,
Egypt, Israel, Japan, Jordan, Kuwait, Morocco, New Zealand, Pakistan,
the Philippines, Thailand, and Republic of Korea. Taiwan shall be
treated as though it were designated a major non-NATO ally (as defined
in section 644(q) of the Foreign Assistance Act of 1961 (22 U.S.C.
2403(q)) .
PART 122--REGISTRATION OF MANUFACTURERS AND EXPORTERS
0
6. The authority citation for part 122 is revised to read as follows:
Authority: Secs. 2 and 38, Public Law 90-629, 90 Stat. 744 (22
U.S.C. 2752, 2778); E.O. 11958, 42 FR 4311; 1977 Comp. p. 79, 22
U.S.C. 2651a.
0
7. Section 122.3 is amended by revising paragraph (b) and adding
paragraph (c) to read as follows:
Sec. 122.3 Registration fees.
* * * * *
(b) Expiration of registration. A registrant must submit its
request for registration renewal at least 30 days prior to the
expiration date.
(c) Lapse in registration. A registrant who fails to renew a
registration and, after an intervening period, seeks to register again
must pay registration fees for any part of such intervening period
during which the registrant engaged in the business of manufacturing or
exporting defense articles or defense services.
0
8. Section 122.5 is revised to read as follows:
Sec. 122.5 Maintenance of records by registrants.
(a) A person who is required to register must maintain records
concerning the manufacture, acquisition and disposition (to include
copies of all documentation on exports using exemptions and
applications and licenses and their related documentation), of defense
articles; of technical data; the provision of defense services;
brokering activities; and information on political contributions, fees,
or commissions furnished or obtained, as required by part 130 of this
subchapter. Records in an electronic format must be maintained using a
process or system capable of reproducing all records on paper. Such
records when displayed on a viewer, monitor, or reproduced on paper,
must exhibit a high degree of legibility and readability. (For the
purpose of this section, ``legible'' and ``legibility'' mean the
quality of a letter or numeral that enables the observer to identify it
positively and quickly to the exclusion of all other letters or
numerals. ``Readable'' and ``readability'' means the quality of a group
of letters or numerals being recognized as complete words or numbers.)
This information must be stored in such a manner that none of it may be
altered once it is initially
[[Page 50960]]
recorded without recording all changes, who made them, and when they
were made. For processes or systems based on the storage of digital
images, the process or system must afford accessibility to all digital
images in the records being maintained. All records subject to this
section must be maintained for a period of five years from the
expiration of the license or other approval, to include exports using
an exemption (See Sec. 123.26 of this subchapter); or, from the date of
the transaction (e.g. expired licenses or other approvals relevant to
the export transaction using an exemption). The Managing Director,
Directorate of Defense Trade Controls, and the Director of the Office
of Defense Trade Controls Licensing, may prescribe a longer or shorter
period in individual cases.
(b) Records maintained under this section shall be available at all
times for inspection and copying by the Directorate of Defense Trade
Controls or a person designated by the Directorate of Defense Trade
Controls (e.g. the Diplomatic Security Service) or U.S. Immigration and
Customs Enforcement, or U.S. Customs and Border Protection. Upon such
request, the person maintaining the records must furnish the records,
the equipment, and if necessary, knowledgeable personnel for locating,
reading, and reproducing any record that is required to be maintained
in accordance with this section.
PART 123--LICENSES FOR THE EXPORT OF DEFENSE ARTICLES
0
9-10. The authority citation for part 123 continues to read as follows:
Authority: Secs. 2, 38, and 71, Public Law 90-629, 90 Stat. 744
(22 U.S.C. 2752, 2778, 2797); 22 U.S.C. 2753; E.O. 11958, 42 FR
4311; 3 CFR, 1977 Comp. p. 79; 22 U.S.C. 2651a; 22 U.S.C. 2776;
Public Law 105-261, 112 Stat. 1920; Sec 1205(a), Public Law 107-228.
0
11. Section 123.1 is amended by revising paragraph (c)(2) to read as
follows:
Sec. 123.1 Requirement for export or temporary import licenses.
* * * * *
(c) * * *
(1) * * *
(2) Attachments and supporting technical data or brochures should
be submitted in seven collated copies. Two copies of any freight
forwarder lists must be submitted. If the request is limited to renewal
of a previous license or for the export of spare parts, only two sets
of any attachment (including freight forwarder lists) and one copy of
the previous license should be submitted. In the case of fully
electronic submissions, unless otherwise expressly required by the
Directorate of Defense Trade Controls, applicants need not provide
multiple copies of supporting documentation and attachments, supporting
technical data or brochures, and freight forwarder lists.
* * * * *
0
12. Section 123.4 is amended by revising paragraphs (a), (a)(2), (b),
(d) introductory text, (d)(1)(i), and (d)(2) to read as follows:
Sec. 123.4 Temporary import license exemptions.
(a) Port Directors of U.S. Customs and Border Protection shall
permit the temporary import (and subsequent export) without a license,
for a period of up to 4 years, of unclassified U.S.-origin defense
items (including any items manufactured abroad pursuant to U.S.
Government approval) if the item temporarily imported:
* * * * *
(2) Is to be enhanced, upgraded or incorporated into another item
which has already been authorized by the Directorate of Defense Trade
Controls for permanent export; or
* * * * *
(b) Port Directors of U.S. Customs and Border Protection shall
permit the temporary import (but not the subsequent export) without a
license of unclassified defense articles that are to be incorporated
into another article, or modified, enhanced, upgraded, altered,
improved or serviced in any other manner that changes the basic
performance or productivity of the article prior to being returned to
the country from which they were shipped or prior to being shipped to a
third country. A DSP-5 is required for the reexport of such
unclassified defense articles after incorporation into another article,
modification, enhancement, upgrading, alteration or improvement.
* * * * *
(d) Procedures. To the satisfaction of the Port Director of U.S.
Customs and Border Protection, the importer and export must comply with
the following procedures:
(1) * * *
(i) File and annotate the applicable U.S. Customs and Border
Protection document (e.g., Form CF 3461, 7512, 7501, 7523 or 3311) to
read: ``This shipment is being imported in accordance with and under
the authority of 22 CFR 123.4(a) (identify subsection),'' and
* * * * *
(2) At the time of export, in accordance with the U.S. Customs and
Border Protection procedures, the Directorate of Defense Trade Controls
(DDTC) registered and eligible exporter, or an agent acting on the
filer's behalf, must electronically file the export information using
the Automated Export System (AES), and identify 22 CFR 123.4 as the
authority for the export and provide, as requested by U.S. Customs and
Border Protection, the entry document number or a copy of the U.S.
Customs and Border Protection document under which the article was
imported.
0
13. Section 123.5 is revised to read as follows:
Sec. 123.5 Temporary export licenses.
(a) The Directorate of Defense Trade Controls may issue a license
for the temporary export of unclassified defense articles (DSP-73).
Such licenses are valid only if the article will be exported for a
period of less than 4 years and will be returned to the United States
and transfer of title will not occur during the period of temporary
export. Accordingly, articles exported pursuant to a temporary export
license may not be sold or otherwise permanently transferred to a
foreign person while they are overseas under a temporary export
license. A renewal of the license or other written approval must be
obtained from the Directorate of Defense Trade Controls if the article
is to remain outside the United States beyond the period for which the
license is valid.
(b) Requirements. Defense articles authorized for temporary export
under this section may be shipped only from a port in the United States
where a Port Director of U.S. Customs and Border Protection is
available, or from a U.S. Post Office (see 39 CFR part 20), as
appropriate. The license for temporary export must be presented to the
Port Director of U.S. Customs and Border Protection who, upon
verification, will endorse the exit column on the reverse side of the
license. In some instances of the temporary export of technical data
(e.g. postal shipments), self-endorsement will be necessary (see Sec.
123.22(b)). The endorsed license for temporary export is to be retained
by the licensee. In the case of a military aircraft or vessel exported
under its own power, the endorsed license must be carried on board such
vessel or aircraft as evidence that it has been duly authorized by the
Department of State to leave the United States temporarily.
(c) Any temporary export license for hardware that is used,
regardless of whether the hardware was exported directly to the foreign
destination or
[[Page 50961]]
returned directly from the foreign destination, must be endorsed by the
U.S. Customs and Border Protection in accordance with the procedures in
Sec. 123.22 of this subchapter.
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14. Section 123.6 is revised to read as follows:
Sec. 123.6 Foreign trade zones and U.S. Customs and Border Protection
bonded warehouses.
Foreign trade zones in the United States and U.S. Customs and
Border Protection bonded warehouses are considered integral parts of
the United States for the purpose of this subchapter. An export license
is therefore not required for shipment between the United States and a
foreign trade zone or a U.S. Customs and Border Protection bonded
warehouse. In the case of classified defense articles, the provisions
of the Department of Defense Industrial Security Manual will apply. An
export license is required for all shipments of articles on the U.S.
Munitions List from foreign trade zones and U.S. Customs and Border
Protection bonded warehouses to foreign countries, regardless of how
the articles reached the zone or warehouse.
0
15. Section 123.13 is revised to read as follows:
Sec. 123.13 Domestic aircraft shipments via a foreign country.
A license is not required for the shipment by air of a defense
article from one location in the United States to another location in
the United States via a foreign country. The pilot of the aircraft
must, however, file a written statement with the Port Director of U.S.
Customs and Border Protection at the port of exit in the United States.
The original statement must be filed at the time of exit with the Port
Director of U.S. Customs and Border Protection. A duplicate must be
filed at the port of reentry with the Port Director of U.S. Customs and
Border Protection, who will duly endorse it and transmit it to the Port
Director of U.S. Customs and Border Protection at the port of exit. The
statement will be as follows:
Domestic Shipment Via a Foreign Country of Articles on the U.S.
Munitions List
Under penalty according to Federal law, the undersigned
certifies and warrants that all the information in this document is
true and correct, and that the equipment listed below is being
shipped from (U.S. port of exit) via (foreign country) to (U.S. port
of entry), which is the final destination in the United States.
Description of Equipment
Quantity--------------------------------------------------------------
Equipment-------------------------------------------------------------
Value-----------------------------------------------------------------
Signed----------------------------------------------------------------
Endorsement: U.S. Customs and Border Protection Inspector.
Port of Exit----------------------------------------------------------
Date------------------------------------------------------------------
Signed----------------------------------------------------------------
Endorsement: U.S. Customs and Border Protection Inspector.
Port of Entry---------------------------------------------------------
Date------------------------------------------------------------------
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16. Section 123.16 is amended by revising paragraphs (a), (b)(1)
introductory text, (b)(2) introductory text, (b)(3), (b)(4), (b)(5),
(b)(9), and (b)(10) introductory text to read as follows:
Sec. 123.16 Exemptions of general applicability.
(a) The following exemptions apply to exports of unclassified
defense articles for which no approval is needed from the Directorate
of Defense Trade Controls. These exemptions do not apply to: Proscribed
destinations under Sec. 126.1 of this subchapter; exports for which
Congressional notification is required (see Sec. 123.15 of this
subchapter); MTCR articles; Significant Military Equipment (SME); and
may not be used by persons who are generally ineligible as described in
Sec. 120.1(c) of this subchapter. All shipments of defense articles,
including those to and from Canada, require a Shipper's Export
Declaration (SED) or notification letter. If the export of a defense
article is exempt from licensing, the SED must cite the exemption.
Refer to Sec. 123.22 for Shipper's Export Declaration and letter
notification requirements.
(b) * * *
(1) Port Directors of U.S. Customs and Border Protection shall
permit the export without a license of defense hardware being exported
in furtherance of a manufacturing license agreement, technical
assistance agreement, distribution agreement or an arrangement for
distribution of items identified in Category XIII(b)(1), approved in
accordance with part 124, provided that:
* * * * *
(2) Port Directors of U.S. Customs and Border Protection shall
permit the export of components or spare parts (for exemptions for
firearms and ammunition see Sec. 123.17) without a license when the
total value does not exceed $500 in a single transaction and:
* * * * *
(3) Port Directors of U.S. Customs and Border Protection shall
permit the export without a license, of packing cases specially
designed to carry defense articles.
(4) Port Directors of U.S. Customs and Border Protection shall
permit the export without a license, of unclassified models or mock-ups
of defense articles, provided that such models or mock-ups are
nonoperable and do not reveal any technical data in excess of that
which is exempted from the licensing requirements of Sec. 125.4(b) of
this subchapter and do not contain components covered by the U.S.
Munitions List (see Sec. 121.8(b) of this subchapter). Some models or
mockups built to scale or constructed of original materials can reveal
technical data. U.S. persons who avail themselves of this exemption
must provide a written certification to the Port Director of U.S.
Customs and Border Protection that these conditions are met. This
exemption does not imply that the Directorate of Defense Trade Controls
will approve the export of any defense articles for which models or
mocks-ups have been exported pursuant to this exemption.
(5) Port Directors of U.S. Customs and Border Protection shall
permit the temporary export without a license of unclassified defense
articles to any public exhibition, trade show, air show or related
event if that article has previously been licensed for a public
exhibition, trade show, air show or related event and the license is
still valid. U.S. persons who avail themselves of this exemption must
provide a written certification to the Port Director of U.S. Customs
and Border Protection that these conditions are met.
* * * * *
(9) Port Directors of U.S. Customs and Border Protection shall
permit the temporary export without a license by a U.S. person of any
unclassified component, part, tool or test equipment to a subsidiary,
affiliate or facility owned or controlled by the U.S. person (see Sec.
122.2(c) of this subchapter) if the component, part, tool or test
equipment is to be used for manufacture, assembly, testing, production,
or modification provided:
(i) The U.S. person is registered with the Directorate of Defense
Trade Controls and complies with all requirements set forth in part 122
of this subchapter;
(ii) No defense article exported under this exemption may be sold
or transferred without the appropriate license or other approval from
the Directorate of Defense Trade Controls.
(10) Port Directors of U.S. Customs and Border Protection shall
permit, without a license, the permanent export, and temporary export
and return to the
[[Page 50962]]
United States, by accredited U.S. institutions of higher learning of
articles fabricated only for fundamental research purposes otherwise
controlled by Category XV (a) or (e) in Sec. 121.1 of this subchapter
when all of the following conditions are met:
* * * * *
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17. Section 123.17 is amended by revising paragraphs (a), (b), (c)
introductory text, (d) and (e) to read as follows:
Sec. 123.17 Exports of firearms and ammunition.
(a) Except as provided in Sec. 126.1 of this subchapter, Port
Directors of U.S. Customs and Border Protection shall permit the export
without a license of components and parts for Category I(a) firearms,
except barrels, cylinders, receivers (frames) or complete breech
mechanisms when the total value does not exceed $100 wholesale in any
transaction.
(b) Port Directors of U.S. Customs and Border Protection shall
permit the export without a license of nonautomatic firearms covered by
Category I(a) of Sec. 121.1 of this subchapter if they were
manufactured in or before 1898, or are replicas of such firearms.
(c) Port Directors of U.S. Customs and Border Protection shall
permit U.S. persons to export temporarily from the United States
without a license not more than three nonautomatic firearms in Category
I(a) of Sec. 121.1 of this subchapter and not more than 1,000
cartridges therefor, provided that:
* * * * *
(d) Port Directors of U.S. Customs and Border Protection shall
permit a foreign person to export without a license such firearms in
Category I(a) of Sec. 121.1 of this subchapter and ammunition therefor
as the foreign person brought into the United States under the
provisions of 27 CFR 178.115(d). (The latter provision specifically
excludes from the definition of importation the bringing into the
United States of firearms and ammunition by certain foreign persons for
specified purposes).
(e) Port Directors of U.S. Customs and Border Protection shall
permit U.S. persons to export without a license ammunition for
nonautomatic firearms referred to in paragraph (a) of this section if
the quantity does not exceed 1,000 cartridges (or rounds) in any
shipment. The ammunition must also be for personal use and not for
resale or other transfer of ownership. The foregoing exemption is also
not applicable to the personnel referred to in Sec. 123.18.
0
18. Section 123.18 is amended by revising paragraphs (a) introductory
text, (a)(3), and (b) to read as follows:
Sec. 123.18 Firearms for personal use of members of the U.S. Armed
Forces and civilian employees of the U.S. Government.
* * * * *
(a) Firearms. Port Directors of U.S. Customs and Border Protection
shall permit nonautomatic firearms in Category I(a) of Sec. 121.1 of
this subchapter and parts therefor to be exported, except by mail, from
the United States without a license if:
* * * * *
(3) In the case of other U.S. Government employees, they are for
personal use and not for resale or other transfer of ownership, and the
Chief of the U.S. Diplomatic Mission or his designee in the country of
destination has approved in writing to Department of State the import
of the specific types and quantities of firearms into that country. The
exporter shall provide a copy of this written statement to the Port
Director of U.S. Customs and Border Protection.
(b) Ammunition. Port Directors of U.S. Customs and Border
Protection shall permit not more than 1,000 cartridges (or rounds) of
ammunition for the firearms referred to in paragraph (a) of this
section to be exported (but not mailed) from the United States without
a license when the firearms are on the person of the owner or with his
baggage or effects, whether accompanied or unaccompanied (but not
mailed).
0
19. Section 123.22 is amended by revising paragraphs (a), (b)(1)
introductory text, (b)(2) introductory text, (b)(3)(iii) and (c) to
read as follows:
Sec. 123.22 Filing, retention, and return of export licenses and
filing of export information.
(a) Any export, as defined in this subchapter, of a defense article
controlled by this subchapter, to include defense articles transiting
the United States, requires the electronic reporting of export
information. The reporting of the export information shall be to the
U.S. Customs and Border Protection using the Automated Export System
(AES) or directly to the Directorate of Defense Trade Controls (DDTC).
Any license or other approval authorizing the permanent export of
hardware must be filed at a U.S. Port before any export. Licenses or
other approvals for the permanent export of technical data and defense
services shall be retained by the applicant who will send the export
information directly to DDTC. Temporary export or temporary import
licenses for such items need not be filed with the U.S. Customs and
Border Protection, but must be presented to the U.S. Customs and Border
Protection for decrementing of the shipment prior to departure and at
the time of entry. The U.S. Customs and Border Protection will only
decrement a shipment after the export information has been filed
correctly using the AES. Before the export of any hardware using an
exemption in this subchapter, the DDTC registered applicant/exporter,
or an agent acting on the filer's behalf, must electronically provide
export information using the AES (see paragraph (b) of this section).
In addition to electronically providing the export information to the
U.S. Customs and Border Protection before export, all the mandatory
documentation must be presented to the port authorities (e.g.,
attachments, certifications, proof of AES filing; such as the External
Transaction Number (XTN) or Internal Transaction Number (ITN)). Export
authorizations shall be filed, retained, decremented or returned to
DDTC as follows:
(1) Filing of licenses and documentation for the permanent export
of hardware. For any permanent export of hardware using a license
(e.g., DSP-5, DSP-94) or an exemption in this subchapter, the exporter
must, prior to an AES filing, deposit the license and provide any
required documentation for the license or the exemption with the U.S.
Customs and Border Protection, unless otherwise directed in this
subchapter (e.g., Sec. 125.9). If necessary, an export may be made
through a port other than the one designated on the license if the
exporter complies with the procedures established by the U.S. Customs
and Border Protection.
(2) Presentation and retention by the applicant of temporary
licenses and related documentation for the export of unclassified
defense articles. Licenses for the temporary export or temporary import
of unclassified defense articles need not be filed with the U.S.
Customs and Border Protection, but must be retained by the applicant
and presented to the U.S. Customs and Border Protection at the time of
temporary import and temporary export. When a defense article is
temporarily exported from the United States and moved from one
destination authorized on a license to another destination authorized
on the same or another temporary license, the applicant, or an agent
acting on the applicant's behalf, must ensure that the U.S. Customs and
Border Protection decrements both temporary licenses to show the exit
and entry of the hardware.
(b) Filing and reporting of export information--(1) Filing of
export information with the U.S. Customs and
[[Page 50963]]
Border Protection. Before exporting any hardware controlled by this
subchapter, using a license or exemption, the DDTC registered
applicant/exporter, or an agent acting on the filer's behalf, must
electronically file the export information with the U.S. Customs and
Border Protection using the Automated Export System (AES) in accordance
with the following timelines:
* * * * *
(2) Emergency shipments of hardware that cannot meet the pre-
departure filing requirements. U.S. Customs and Border Protection may
permit an emergency export of hardware by truck (e.g., departures to
Mexico or Canada) or air, by a U.S. registered person, when the
exporter is unable to comply with the SED filing timeline in paragraph
(b)(1)(i) of this section. The applicant, or an agent acting on the
applicant's behalf, in addition to providing the export information
electronically using the AES, must provide documentation required by
the U.S. Customs and Border Protection and this subchapter. The
documentation provided to the U.S. Customs and Border Protection at the
port of exit must include the External Transaction Number (XTN) or
Internal Transaction Number (ITN) for the shipment and a copy of a
notification to DDTC stating that the shipment is urgent and why. The
original of the notification must be immediately provided to DDTC. The
AES filing of the export information when the export is by air must be
at least two hours prior to any departure from the United States; and,
when a truck shipment, at the time when the exporter provides the
articles to the carrier or at least one hour prior to departure from
the United States, when the permanent export of the hardware has been
authorized for export:
* * * * *
(3) * * *
(iii) Technical data and defense service exemptions. In any
instance when technical data is exported using an exemption in this
subchapter (e.g., Sec. Sec. 125.4(b)(2), 125.4(b)(4), 126.5) from a
U.S. port, the exporter is not required to report using AES, but must,
effective January 18, 2004, provide the export data electronically to
DDTC. A copy of the electronic notification to DDTC must accompany the
technical data shipment and be made available to the U.S. Customs and
Border Protection upon request.
Note to paragraph (b)(3)(iii): Future changes to the electronic
reporting procedure will be amended by publication of a rule in the
Federal Register. Exporters are reminded to continue maintaining
records of all export transactions, including exemption shipments,
in accordance with this subchapter.
(c) Return of licenses. All licenses issued by the Directorate of
Defense Trade Controls (DDTC) must be returned to the DDTC in
accordance with the following:
(1) License filed with the U.S. Customs and Border Protection. The
U.S. Customs and Border Protection must return to the DDTC any license
when the total value or quantity authorized has been shipped or when
the date of expiration is reached, whichever occurs first.
(2) Licenses not filed with the U.S. Customs and Border Protection.
Any license that is not filed with the U.S. Customs and Border
Protection (e.g., oral or visual technical data releases or temporary
import and export licenses retained in accordance with paragraph (a)(2)
of this section), must be returned by the applicant to the DDTC no
later than 60 days after the license has been expended (e.g., total
value or quantity authorized has been shipped) or the date of
expiration, whichever occurs first.
0
20. Section 123.23 is revised to read as follows:
Sec. 123.23 Monetary value of shipments.
Port Directors of U.S. Customs and Border Protection shall permit
the shipment of defense articles identified on any license when the
total value of the export does not exceed the aggregate monetary value
(not quantity) stated on the license by more than ten percent, provided
that the additional monetary value does not make the total value of the
license or other approval for the export of any major defense equipment
sold under a contract reach $14,000,000 or more, and provided that the
additional monetary value does not make defense articles or defense
services sold under a contract reach the amount of $50,000,000 or more.
0
21. Section 123.24 is amended by revising paragraph (a) to read as
follows:
Sec. 123.24 Shipments by U.S. Postal Service.
(a) The export of any defense hardware using a license or exemption
in this subchapter by the U.S. Postal Service must be filed with the
U.S. Customs and Border Protection using the Automated Export System
(AES) and the license must be filed with the U.S. Customs and Border
Protection before any hardware is actually sent abroad by mail. The
exporter must certify the defense hardware being exported in accordance
with this subchapter by clearly marking on the package ``This export is
subject to the controls of the ITAR, 22 CFR (identify section for an
exemption) or (state license number) and the export has been
electronically filed with the U.S. Customs and Border Protection using
the Automated Export System (AES).''
* * * * *
0
22. Section 123.27 is amended by revising paragraph (a)(1) to read as
follows:
Sec. 123.27 Special licensing regime for export to U.S. allies of
commercial communications satellite components, systems, parts,
accessories, attachments and associated technical data.
(a) * * *
(1) The proposed exports or re-exports concern exclusively one or
more countries of the North Atlantic Treaty Organization (see Sec.
120.31 of this subchapter) and/or one or more countries which have been
designated in accordance with section 517 of the Foreign Assistance Act
of 1961 and with section 1206 of the Foreign Relations Authorization
Act, Fiscal Year 2003 as a major non-NATO ally (see Sec. 120.32 of
this subchapter).
* * * * *
PART 124--AGREEMENTS, OFF-SHORE PROCUREMENT AND OTHER DEFENSE
SERVICES
0
23. The authority citation for part 124 continues to read as follows:
Authority: Secs. 2, 38, and 71, Public Law 90-629, 90 Stat. 744
(22 U.S.C. 2752, 2778, 2797); E.O. 11958, 42 FR 4311; 3 CFR, 1977
Comp., p. 79; 22 U.S.C. 2651a; 22 U.S.C. 2776; Public Law 105-261.
0
24. Section 124.3 is amended by revising paragraphs (a) and (b)
introductory text to read as follows:
Sec. 124.3 Exports of technical data in furtherance of an agreement.
(a) Unclassified technical data. The U.S. Customs and Border
Protection or U.S. Postal authorities shall permit the export without a
license of unclassified technical data if the export is in furtherance
of a manufacturing license or technical assistance agreement which has
been approved in writing by the Directorate of Defense Trade Controls
(DDTC) and the technical data does not exceed the scope or limitations
of the relevant agreement. The approval of the DDTC must be obtained
for the export of any unclassified technical data that may exceed the
terms of the agreement.
(b) Classified technical data. The export of classified information
in furtherance of an approved manufacturing license or technical
assistance agreement which provides for
[[Page 50964]]
the transmittal of classified information does not require further
approval from the Directorate of Defense Trade Controls when:
* * * * *
PART 126--GENERAL POLICIES AND PROVISIONS
0
25. The authority citation for part 126 continues to read as follows:
Authority: Secs. 2, 38, 40, 42, and 71, Public Law 90-629, 90
Stat. 744 (22 U.S.C. 2752, 2778, 2780, 2791, and 2797); E.O. 11958,
42 FR 4311; 3 CFR, 1977 Comp., p. 79; 22 U.S.C. 2651a; 22 U.S.C.
287c; E.O. 12918, 59 FR 28205, 3 CFR, 1994 Comp., p. 899; Sec. 1225,
Public Law 108-375.
0
26. Section 126.4 is amended by revising paragraphs (a) and (d) to read
as follows:
Sec. 126.4 Shipments by or for United States Government agencies.
(a) A license is not required for the temporary import, or
temporary export, of any defense article, including technical data or
the performance of a defense service, by or for any agency of the U.S.
Government for official use by such an agency, or for carrying out any
foreign assistance, cooperative project or sales program authorized by
law and subject to control by the President by other means. This
exemption applies only when all aspects of a transaction (export,
carriage, and delivery abroad) are affected by a United States
Government agency or when the export is covered by a United States
Government Bill of Lading. This exemption, however, does not apply when
a U.S. Government agency acts as a transmittal agent on behalf of a
private individual or firm, either as a convenience or in satisfaction
of security requirements. The approval of the Directorate of Defense
Trade Controls must be obtained before defense articles previously
exported pursuant to this exemption are permanently transferred (e.g.,
property disposal of surplus defense articles overseas) unless the
transfer is pursuant to a grant, sale, lease, loan or cooperative
project under the Arms Export Control Act or a sale, lease or loan
under the Foreign Assistance Act of 1961, as amended, or the defense
articles have been rendered useless for military purposes beyond the
possibility of restoration.
Note: Special definition. For purposes of this section, defense
articles exported abroad for incorporation into a foreign launch
vehicle or for use on a foreign launch vehicle or satellite that is
to be launched from a foreign country shall be considered a
permanent export.
* * * * *
(d) A Shipper's Export Declaration (SED), required under Sec.
123.22 of this subchapter, and a written statement by the exporter
certifying that these requirements have been met must be presented at
the time of export to the appropriate Port Director of U.S. Customs and
Border Protection or Department of Defense transmittal authority. A
copy of the SED and the written certification statement shall be
provided to the Directorate of Defense Trade Controls immediately
following the export.
0
27. Section 126.5 is amended by revising paragraphs (a), (b)
introductory text, (c)(5) and (d) introductory text to read as follows:
Sec. 126.5 Canadian exemptions.
(a) Temporary import of defense articles. Port Director of U.S.
Customs and Border Protection and postmasters shall permit the
temporary import and return to Canada without a license of any
unclassified defense articles (see Sec. 120.6 of this subchapter) that
originate in Canada for temporary use in the United States and return
to Canada. All other temporary imports shall be in accordance with
Sec. Sec. 123.3 and 123.4 of this subchapter.
(b) Permanent and temporary export of defense articles. Except as
provided below, the Port Director of U.S. Customs and Border Protection
and postmasters shall permit, when for end-use in Canada by Canadian
Federal or Provincial governmental authorities acting in an official
capacity or by a Canadian-registered person or return to the United
States, the permanent and temporary export to Canada without a license
of defense articles and related technical data identified in 22 CFR
121.1. The above exemption is subject to the following limitations:
Defense articles and related technical data, and defense services
identified in paragraphs (b)(1) through (b)(21) of this section and
exports that transit third countries. Such limitations also are subject
to meeting the requirements of this subchapter, (to include 22 CFR
120.1(c) and (d), parts 122 and 123 (except insofar as exemption from
licensing requirements is herein authorized) and Sec. 126.1, and the
requirement to obtain non-transfer and use assurances for all
significant military equipment. For purposes of this section,
``Canadian-registered person'' is any Canadian national (including
Canadian business entities organized under the laws of Canada), dual
citizen of Canada and a third country (subject to Sec. 126.1), and
permanent resident registered in Canada in accordance with the Canadian
Defense Production Act, and such other Canadian Crown Corporations
identified by the Department of State in a list of such persons
publicly available through the Internet Web site of the Directorate of
Defense Trade Controls and by other means. The defense articles,
related technical data, and defense services identified in 22 CFR 121.1
continuing to require a license are:
* * * * *
(c) * * *
(5) The U.S. exporter must provide the Directorate of Defense Trade
Controls a semi-annual report of all their on-going activities
authorized under this section. The report shall include the article(s)
being produced; the end user(s) (i.e., name of U.S. or Canadian
company); the end item into which the product is to be incorporated;
the intended end use of the product (e.g., United States or Canadian
Defense contract number and identification of program); the name and
address of all the Canadian contractors and subcontractors; and
* * * * *
(d) Reexports/retransfer. Reexport/re-transfer in Canada to another
end user or end use or from Canada to another destination, except the
United States, must in all instances have the prior approval of the
Directorate of Defense Trade Controls. Unless otherwise exempt in this
subchapter, the original exporter is responsible, upon request from a
Canadian-registered person, for obtaining or providing reexport/
retransfer approval. In any instance when the U.S. exporter is no
longer available to the Canadian end user the request for reexport/
retransfer may be made directly to Department of State, Directorate of
Defense Trade Controls. All requests must include the information in
Sec. 123.9(c) of this subchapter. Reexport/retransfer approval is
acquired by:
* * * * *
0
28. Section 126.6 is amended by revising paragraphs (a) introductory
text, (c) introductory text, (c)(6)(i), (c)(6)(ii), (c)(7)(ii) and
(c)(7)(iv) to read as follows:
Sec. 126.6 Foreign-owned military aircraft and naval vessels, and the
Foreign Military Sales program.
(a) A license from the Directorate of Defense Trade Controls is not
required if:
* * * * *
[[Page 50965]]
(c) Foreign Military Sales Program. A license from the Directorate
of Defense Trade Controls is not required if the defense article or
technical data or a defense service to be transferred was sold, leased
or loaned by the Department of Defense to a foreign country or
international organization under the Foreign Military Sales (FMS)
Program of the Arms Export Control Act pursuant to an Letter of Offer
and Acceptance (LOA) authorizing such transfer which meets the criteria
stated below:
* * * * *
(6) * * *
(i) The transfer is made by the relevant foreign diplomatic mission
of the purchasing country or its authorized freight forwarder, provided
that the freight forwarder is registered with the Directorate of
Defense Trade Controls pursuant to part 122 of this subchapter, and
(ii) At the time of shipment, the Port Director of U.S. Customs and
Border Protection is provided an original and properly executed DSP-94
accompanied by a copy of the LOA and any other documents required by
U.S. Customs and Border Protection in carrying out its
responsibilities. The Shippers Export Declaration or, if authorized,
the outbound manifest, must be annotated ``This shipment is being
exported under the authority of Department of State Form DSP-94. It
covers FMS Case [insert case identification], expiration [insert date].
22 CFR 126.6 applicable. The U.S. Government point of contact is ------
--, telephone number --------,'' and
* * * * *
(7) * * *
(ii) The U.S. person(s) identified in the contract maintain a
registration with the Directorate of Defense Trade Controls for the
entire time that the defense service is being provided. In any instance
when the U.S. registered person(s) identified in the contract employs a
subcontractor, the subcontractor may only use this exemption when
registered with DDTC, and when such subcontract meets the above stated
requirements, and
* * * * *
(iv) The U.S. person responsible for the transfer reports the
initial transfer, citing this section of the ITAR, the FMS case
identifier, contract and subcontract number, the foreign country, and
the duration of the service being provided to the Directorate of
Defense Trade Controls using DDTC's Direct Shipment Verification
Program.
0
29. Section 126.10 is amended by revising paragraph (b) to read as
follows:
Sec. 126.10 Disclosure of information.
* * * * *
(b) Determinations required by law. Section 38(e) of the Arms
Export Control Act (22 U.S.C. 2778) provides by reference to certain
procedures of the Export Administration Act that certain information
required by the Department of State in connection with the licensing
process may generally not be disclosed to the public unless certain
determinations relating to the national interest are made in accordance
with the procedures specified in that provision, except that the names
of the countries and types and quantities of defense articles for which
licenses are issued under this section shall not be withheld from
public disclosure unless the President determines that release of such
information would be contrary to the national interest. Registration
with the Directorate of Defense Trade Controls is required of certain
persons, in accordance with Section 38 of the Arms Export Control Act.
The requirements and guidance are provided in the ITAR pursuant to
parts 122 and 129. Registration is generally a precondition to the
issuance of any license or other approvals under this subchapter, to
include the use of any exemption. Therefore, information provided to
the Department of State to effect registration, as well as that
regarding actions taken by the Department of State related to
registration, may not generally be disclosed to the public.
Determinations required by Section 38(e) shall be made by the Assistant
Secretary for Political-Military Affairs.
* * * * *
0
30. Section 126.13 is amended by revising paragraphs (a) introductory
text and (b) to read as follows:
Sec. 126.13 Required information.
(a) All applications for licenses (DSP-5, DSP-61, DSP-73, and DSP-
85), all requests for approval of agreements and amendments thereto
under part 124 of this subchapter, all requests for other written
authorizations, and all 30-day prior notifications of sales of
significant military equipment under Sec. 126.8(c) must include a
letter signed by a responsible official empowered by the applicant and
addressed to the Directorate of Defense Trade Controls, stating
whether:
* * * * *
(b) In addition, all applications for licenses must include, on the
application or an addendum sheet, the complete names and addresses of
all U.S. consignors and freight forwarders, and all foreign consignees
and foreign intermediate consignees involved in the transaction. If
there are multiple consignors, consignees or freight forwarders, and
all the required information cannot be included on the application
form, an addendum sheet and seven copies containing this information
must be provided. The addendum sheet must be marked at the top as
follows: ``Attachment to Department of State License Form (insert DSP-
5, 61, 73, or 85, as appropriate) for Export of (insert commodity)
valued at (insert U.S. dollar amount) to (insert country of ultimate
destination).'' The Directorate of Defense Trade Controls will impress
one copy of the addendum sheet with the Department of State seal and
return it to the applicant with each license. The sealed addendum sheet
must remain attached to the license as an integral part thereof. Port
Directors of U.S. Customs and Border Protection and Department of
Defense transmittal authorities will permit only those U.S. consignors
or freight forwarders listed on the license or sealed addendum sheet to
make shipments under the license, and only to those foreign consignees
named on the documents. Applicants should list all freight forwarders
who may be involved with shipments under the license to ensure that the
list is complete and to avoid the need for amendments to the list after
the license has been approved. If there are unusual or extraordinary
circumstances that preclude the specific identification of all the U.S.
consignors and freight forwarders and all foreign consignees, the
applicant must provide a letter of explanation with each application.
* * * * *
PART 127--VIOLATIONS AND PENALTIES
0
31-32. The authority citation for part 127 is revised to read as
follows:
Authority: Secs. 2, 38, and 42, Public Law 90-629, 90 Stat. 744
(22 U.S.C. 2752, 2778, 2791); E.O. 11958, 42 FR 4311; 3 CFR, 1977
Comp., p. 79; 22 U.S.C. 401; 22 U.S.C. 2651a; 22 U.S.C. 2779a; 22
U.S.C. 2780.
0
33. Section 127.4 is revised to read as follows:
Sec. 127.4 Authority of U.S. Immigration and Customs Enforcement and
U.S. Customs and Border Protection officers.
(a) U.S. Immigration and Customs Enforcement and U.S. Customs and
Border Protection officers may take appropriate action to ensure
observance of this subchapter as to the export or the attempted export
of any defense article or technical data, including the inspection of
loading or unloading of
[[Page 50966]]
any vessel, vehicle, or aircraft. This applies whether the export is
authorized by license or by written approval issued under this
subchapter.
(b) U.S. Immigration and Customs Enforcement and U.S. Customs and
Border Protection officers have the authority to investigate, detain or
seize any export or attempted export of defense articles or technical
data contrary to this subchapter.
(c) Upon the presentation to a U.S. Customs and Border Protection
Officer of a license or written approval authorizing the export of any
defense article, the customs officer may require the production of
other relevant documents and information relating to the proposed
export. This includes an invoice, order, packing list, shipping
document, correspondence, instructions, and the documents otherwise
required by the U.S. Customs and Border Protection or U.S. Immigration
and Customs Enforcement.
Dated: July 25, 2005.
Robert G. Joseph,
Under Secretary, Arms Control and International Security, Department of
State.
[FR Doc. 05-17121 Filed 8-26-05; 8:45 am]
BILLING CODE 4710-25-P