[Federal Register: April 21, 2006 (Volume 71, Number 77)]
[Rules and Regulations]
[Page 20534-20555]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21ap06-8]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF STATE
22 CFR Parts 120, 121, 122, 123, 124, 125, 126, 127, 128, 129, and
130
[Public Notice: 5345]
Amendments to the International Traffic in Arms Regulations:
Office Names, Corrected Cross-Referencing, Reference to Wassenaar
Arrangement, and Other Corrections/Administrative Changes
AGENCY: Department of State.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Department of State is amending the International Traffic
in Arms Regulations (ITAR) to reflect current office names, correct
cross-references, update the reference to the Wassenaar Arrangement,
and make other corrections and administrative changes.
DATES: Effective Date: This rule is effective April 21, 2006.
ADDRESSES: Interested parties may submit comments at any time by any of
the following methods:
E-mail: DDTCResponseTeam@state.gov with an appropriate
subject line.
Mail: Department of State, Directorate of Defense Trade
Controls, Office of Defense Trade Controls Management, ATTN: Regulatory
Change, 12th Floor, SA-1, Washington, DC 20522-0112.
Fax: 202-261-8199.
Hand Delivery or Courier (regular work hours only):
Department of State, Directorate of Defense Trade Controls, Office of
Defense Trade Controls Management, ATTENTION: Regulatory Change, SA-1,
12th Floor, 2401 E Street, NW., Washington, DC 20037.
Persons with access to the Internet may also view this notice by
going to the regulations.gov Web site at: http://www.regulations.gov/index.cfm
.
FOR FURTHER INFORMATION CONTACT: Mary Sweeney, Office of Defense Trade
Controls Management, Department of State, 12th Floor, SA-1, Washington,
DC 20522-0112; Telephone 202-663-2865 or FAX 202-261-8199; e-mail:
DDTCResponseTeam@state.gov. ATTN: Regulatory Change.
SUPPLEMENTARY INFORMATION: References to the ``Office of Defense Trade
Controls'' have been amended to the ``Directorate of Defense Trade
Controls'' (Sec. Sec. 120.1(c), 120.4(a), 120.4(b), 120.12, 120.20,
120.28(a), 121.1 Category XXI(a), 121.16, 122.1(a), 122.4(a), 122.4(b),
122.4(c), 122.4(c)(4). 122.4(d), 123.1(a), 123.1(c), 123.3(a),
123.8(a), 123.8(b), 123.9(a), 123.9(d), 123.9(e), 123.9(e)(3),
123.9(e)(4), 123.10(b), 123.10(c), 123.11(a), 123.14(b), 123.25(a),
123.27(a), 123.27(a)(2), 123.27(a)(5), 123.27(a)(6), 123.27(b),
123.27(c), 124.1(a), 124.1(b), 124.1(c), 124.1(d), 124.4(a), 124.4(b),
124.5, 124.6, 124.10(a), 124.10(b)(1), 124.10 Note, 124.12(1),
124.12(a)(1), 124.13(d), 124.13(e), 124.14(a), 124.14(b), 124.14(b)(4),
124.14(c)(5), 124.14(e), 124.14(e)(1), 125.1(b), 125.2(a), 125.2(b),
125.3(a), 125.3(b), 125.3(c), 125.4(a), 125.4(b)(10)(iii),
125.4(b)(11), 125.5(a), 125.5(b), 125.7(a), 125.7(b), 125.9, 126.1(e),
126.2, 126.7(b), 126.7(c), 126.8(a), 126.8(a)(1), 126.8(a)(2),
126.8(a)(3), 126.8(c)(1)(i), 126.8(c)(2), 126.9(a), 126.9(b),
126.10(a), 126.14(a), 126.14(a)(1), 126.14(a)(2), 126.14(a)(3)(i),
126.14(b), 127.1(a)(1), 127.1(a)(2), 127.1(a)(3), 127.1(c),
127.7(b)(2), 127.8(a), 127.9, 127.10, 127.11, 127.12(a), 127.12(b)(1),
127.12(b)(2), 127.12(b)(3), 127.12(c), 127.12(d)(iii), 128.3(a),
128.5(c), 128.6(a), 128.6(b), 128.6(d), 128.10, 128.11(a), 128.13(d),
128.15(a), 128.15(b)(3), 129.3(a), 129.4(b), 129.5(b), 129.5(c),
129.5(e), 129.6(a), 129.7(a), 129.7(b)(2), 129.7(c), 129.8(a),
129.8(b), 129.9(a), 130.2, 130.8(a)(1), 130.9(a)(1), 130.9(a)(1)(ii),
130.9(a)(2), 130.9(b), 130.9(b)(2), 130.9(d), 130.10(a), 130.11(a)(3),
130.11(b), 130.11(b)(2), 130.12(c), 130.12(d)(1), and 130.12(d)(2)).
``COCOM'' has been amended to the ``Wassenaar Arrangement''
(Sec. Sec. 120.4(d)(3)(ii), 120.4(d)(3)(iii), and 126.10(d)(2)).
``Center for Defense Trade'' has been amended to the ``Directorate of
Defense Trade Controls'' (Sec. Sec. 120.4(g) and 121.1(a)). ``Center
for Defense Trade'' has been amended to ``Office of Defense Trade
Controls Policy'' (Sec. 120.4(e)). Also, references to the ``Bureau of
Politico-Military Affairs'' have been amended to the ``Bureau of
Political-Military Affairs'' (Sec. Sec. 120.4(g), 120.12, 120.28(a),
127.7(a), 127.9 and 127.11(b)). Grammatical changes have been made to
the definition of ``U.S. person'' at Sec. 120.15, to Sec. 124.1(a) by
deleting ``either,'' and to ``Voluntary Disclosures'' at Sec.
127.12(b)(4). The ``Defense Security Assistance Agency'' has been
amended to the ``Defense Security Cooperation Agency'' (Sec.
120.28(b)(3)).
Certain references to the Treasury Department have been amended to
the Attorney General, and other references to Treasury have been
amended to the Department of Justice, as appropriate, because the
Bureau of Alcohol, Tobacco and Firearms (ATF) was transferred to the
Department of Justice and ATF's name was changed to Bureau of Alcohol,
Tobacco, Firearms and Explosives (Sec. Sec. 120.5, 120.18, 123.2 and
126.11). Also, the reference to 31 CFR part 505 has been changed to 27
CFR part 447 and 15 CFR parts 768-799 have been changed to 15 CFR parts
730-799 at Sec. 120.5. References to 27 CFR parts 47, 178 and 179 have
been changed to 27 CFR parts 447, 478, 479, and 555 at Sec. Sec.
120.18 and 123.2. Reference to 27 CFR 178.115(d) has been changed to 27
CFR 478.115(d) at Sec. 123.17(d).
Numerous typographical errors are being corrected in the United
States Munitions List, Sec. 121.1, Categories V and XV.
References to ``technical data'' and ``defense service'' have been
corrected in Sec. 121.1, Categories IV, V, XI, XII, XIV, XVII, XX, and
XXI. Cross references have been corrected (Sec. Sec. 120.1(c),
120.10(a)(1), 120.16, 121.1(b), 121.1 Category V(g)(2), 121.1 Category
V(g)(5), 121.1 Category V(g)(6), 121.1 Category V(g)(7), 121.1 Category
V(g)(8), 124.2(c)(5)(ix), 126.7(a), 127.8(a), 127.9 and 127.11(c)).
Typographical mistakes have been corrected in Sec. 121.1, Category
V(a)(1); Sec. 121.1, Category V(a)(5); Sec. 121.1, Category V(a)(9);
Sec. 121.1, Category V(a)(15)(i); Sec. 121.1, Category V(a)(20)(i);
Sec. 121.1, Category V(a)(24)(ii); Sec. 121.1, Category V(a)(29);
Sec. 121.1, Category V(a)(31)(i); Sec. 121.1, Category V(a)(31)(ii);
Sec. 121.1, Category V(a)(31)(iv); Sec. 121.1, Category V(c)(8);
Sec. 121.1, Category V(c)(9); Sec. 121.1, Category V(e)(2); Sec.
121.1, Category V(e)(9); Sec. 121.1, Category V(e)(13); Sec. 121.1,
Category V(e)(14); Sec. 121.1, Category V(f)(3)(iv); Sec. 121.1,
Category V(f)(14); Sec. 121.1, Category V(f)(15); Sec. 121.1,
Category V(f)(17); Sec. 121.1, Category XV(d)(1); Sec. 121.1,
Category XV(d)(2); Sec. 121.1, Category XV(d)(3); Sec. 121.1,
Category XV(d)(5); Sec. 121.16, Item 1-Category 1; Sec. 121.16, Item
4-Category II; Sec. 121.16, Item 9-Category II; Sec. 121.16, Item 12-
Category II; Sec. 121.16, Note to Item 18(a); and in Sec. Sec.
123.16(b)(2)(v), 126.5(c)(4)(v), 126.14(a)(3)(iv), 127.3(b),
128.7(a)(1)(ii), and 130.5(b)(1). CAS numbers were added in Sec.
121.1, Category V(a)(2); Sec. 121.1, Category V(a)(31)(vii); Sec.
121.1, Category V(a)(34); Sec. 121.1, Category V(e)(11); Sec. 121.1,
Category V(e)(13); and Sec. 121.1, Category V(e)(15). The ``Director
of the Office of Defense Trade Controls'' has been changed to the
``Director, Office of Defense Trade Controls Policy''
[[Page 20535]]
at Category XXI-Miscellaneous Articles in Sec. 121.1.
``Registration Statement'' has been amended to ``Statement of
Registration'' (Sec. Sec. 122.2(b), 122.4(a)(2), 124.1(b), 125.3(a),
126.13(c), and 129.4(a) and (b)).
``Defense Investigative Service'' has been amended to ``Defense
Security Service'' (Sec. Sec. 123.6, 125.3(a), 125.9 and 127.5). The
``Industrial Security Manual'' has been changed to the ``National
Industrial Security Program Operating Manual'' (Sec. Sec. 124.3(b)(2),
125.3(b), 125.4(b)(9)(iii), 125.5(a), 125.5(b), 125.7(b), 125.9 and
127.5). Clarification has been made relating to the authority of the
Secretary of State to impose different conditions on exports apart from
those imposed by the Department of Defense. The ``Directorate for
Freedom of Information and Security Review'' has been amended to
``Office of Freedom of Information and Security Review'' (Sec.
125.4(b)(13)).
Reference to 49 U.S.C. 1508 has been updated to 49 U.S.C. 40103
regarding overflight approval at Sec. 126.6(b). Reference to 15 CFR
part 388 has been updated to 15 CFR part 720 at Sec. 126.7(a)(6).
Additional language has been added to clarify Sec. 127.1(a):
reexporting or retransferring or attempting to reexport or retransfer
from one foreign destination to another foreign destination by a U.S.
Person of any defense article or technical data or by anyone of any
U.S. origin defense article or technical data, or to furnish a defense
service for which a license or written approval is required by the
ITAR; engaging in the business of either manufacturing or exporting
defense articles or furnishing defense services without complying with
the registration requirements of the ITAR; and, engaging in the
business of brokering activities without complying with the
registration requirements of the ITAR or obtaining a license or written
approval as required by the ITAR.
In addition, we have clarified that the ``business of manufacturing
or exporting defense articles or furnishing defense services'' includes
participating in one action and does not require more than one action
(Sec. Sec. 122.1(a) and 127.1(a)). The potential harm to the security
or foreign policy of the United States by even one unregulated action
to facilitate the manufacture, export, or import of a defense article
or defense service warrants the need to subject such actions to
regulation under this subchapter.
Also, Sec. 127.1(d) has been clarified by adding ``knowingly.''
``Under Secretary for International Security Affairs'' has been
amended to the ``Under Secretary for Arms Control and International
Security'' (Sec. Sec. 127.7(d) and 127.8(b)). ``Arms Control and
International Security Affairs'' has been amended to ``Arms Control and
International Security'' (Sec. Sec. 128.13(a), 128.13(c),
128.13(e)(2), and 128.13(f)).
In Sec. 128.2, reference to the Department of Commerce appointing
the Administrative Law Judge has been deleted. Sec. 128.5(c) has been
changed from sending the ``answer'' to the Office of Administrative Law
Judge, United States Department of Commerce, to the designated
Administrative Law Judge.
In Sec. 129.2, the definition of brokering activities has been
clarified to reflect that the ``business of brokering activities''
includes participating in one or more actions as described in the
definition. The potential harm to the security or foreign policy of the
United States by even one unregulated brokering action warrants the
need to subject such action or actions to regulation under this
subchapter.
In Sec. 129.4, language has been added to make it clear that the
registration requirements for brokers are not meant to exclude foreign
persons from registering as brokers. Where foreign persons cannot
provide the same information that a U.S. person would provide, they
still are required to submit information that is substantially similar
in content to that which would be provided by a U.S. person.
References to Sec. 36(a)(8) of the Arms Export Control Act and 22
U.S.C. 2776(a)(8) have been updated to Sec. 36(a)(7) and 22 U.S.C.
2776(a)(7) pertaining to submitting Part 130 reports to Congress as
contained in Sec. 130.17(a).
In Sec. 120.27, the listed criminal statutes have been updated to
reflect corresponding changes to Sec. 38(g)(1)(A) of the Arms Export
Control Act.
In addition, other minor changes have been made in various sections
to clarify the authority of particular offices and officials or to
clarify the underlying purpose of the specific section.
Regulatory Analysis and Notices
Administrative Procedure Act
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.
Regulatory Flexibility Act
This rule does not require analysis under the Regulatory
Flexibility Act.
Unfunded Mandates Act of 1995
This rule does not require analysis under the Unfunded Mandates
Reform Act.
Small Business Regulatory Enforcement Fairness Act of 1996
This amendment has been found not to be a major rule within the
meaning of the Small Business Regulatory Enforcement Fairness 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.
Executive Orders 12372 and 13132
It is determined that this rule does not have sufficient federalism
implications to warrant application of the consultation provisions of
Executive Orders 12372 and 13132.
Executive Order 12866
This amendment is exempt from review under Executive Order 12866,
but has been reviewed internally by the Department of State to ensure
consistency with the purposes thereof.
Paperwork Reduction Act
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 Parts 120 and 125
Arms and munitions, Classified information, Exports.
22 CFR Part 121
Arms and munitions, Exports, U.S. Munitions List.
22 CFR Part 122
Arms and munitions, Exports, Reporting and recordkeeping
requirements.
22 CFR Parts 123 and 126
Arms and munitions, Exports.
22 CFR Parts 124 and 129
Arms and munitions, Exports, Technical assistance.
22 CFR Part 127
Arms and munitions, Crime, Exports, Penalties, Seizures and
forfeitures.
22 CFR Part 128
Administrative practice and procedures, Arms and munitions,
Exports.
[[Page 20536]]
22 CFR Part 130
Arms and munitions, Campaign funds, Confidential business
information, Exports, Reporting and recordkeeping requirements.
0
Accordingly, for the reasons set forth above, Title 22, Chapter I,
Subchapter M, parts 120, 121, 122, 123, 124, 125, 126, 127, 128, 129
and 130 are amended as follows:
PART 120--PURPOSE AND DEFINITIONS
0
1. The authority citation for part 120 is revised to read as follows:
Authority: Secs. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 (22
U.S.C. 2752, 2778, 2797); 22 U.S.C. 2794; E.O. 11958, 42 FR 4311;
E.O. 13284, 68 FR 4075; 3 CFR, 1977 Comp. p. 79; 22 U.S.C. 2651a;
Pub. L. 105-261, 112 Stat. 1920.
0
2. Section 120.1 is amended by revising paragraphs (b)(2) and (c) to
read as follows:
Sec. 120.1 General authorities and eligibility.
* * * * *
(b) * * *
(1) * * *
(2) In the Bureau of Political-Military Affairs, there is a Deputy
Assistant Secretary for Defense Trade Controls (DAS--Defense Trade
Controls) and a Managing Director of Defense Trade Controls (MD--
Defense Trade Controls). The DAS--Defense Trade Controls and the MD--
Defense Trade Controls are responsible for exercising the authorities
conferred under this subchapter. The DAS--Defense Trade Controls is
responsible for oversight of the defense trade controls function. The
MD--Defense Trade Controls is responsible for the Directorate of
Defense Trade Controls, which oversees the subordinate offices
described in paragraphs (b)(2)(i) through (b)(2)(iv) of this section.
(i) The Office of Defense Trade Controls Management and the
Director, Office of Defense Trade Controls Management, which have
responsibilities related to management of defense trade controls
operations, to include the exercise of general authorities in this part
120, and the design, development, and refinement of processes,
activities, and functional tools for the export licensing regime and to
effect export compliance/enforcement activities;
(ii) The Office of Defense Trade Controls Licensing and the
Director, Office of Defense Trade Controls Licensing, which have
responsibilities related to licensing or other authorization of defense
trade, including references under parts 120, 123, 124, 125, 126, 129
and 130 of this subchapter;
(iii) The Office of Defense Trade Controls Compliance and the
Director, Office of Defense Trade Controls Compliance, which have
responsibilities related to violations of law or regulation and
compliance therewith, including references contained in parts 122, 126,
127, 128 and 130 of this subchapter, and that portion under part 129 of
this subchapter pertaining to registration;
(iv) The Office of Defense Trade Controls Policy and the Director,
Office of Defense Trade Controls Policy, which have responsibilities
related to the general policies of defense trade, including references
under this part 120 and part 126 of this subchapter, and the commodity
jurisdiction procedure under this subchapter, including under this part
120.
(c) Eligibility. Only U.S. persons (as defined in Sec. 120.15) and
foreign governmental entities in the United States may be granted
licenses or other approvals (other than retransfer approvals sought
pursuant to this subchapter). Foreign persons (as defined in Sec.
120.16) other than governments are not eligible. U.S. persons who have
been convicted of violating the criminal statutes enumerated in Sec.
120.27, who have been debarred pursuant to part 127 or 128 of this
subchapter, who are the subject of an indictment involving the criminal
statutes enumerated in Sec. 120.27, who are ineligible to contract
with, or to receive a license or other form of authorization to import
defense articles or defense services from any agency of the U.S.
Government, who are ineligible to receive export licenses (or other
forms of authorization to export) from any agency of the U.S.
Government, who are subject to Department of State Suspension/
Revocation under Sec. 126.7(a)(1) through (a)(7) of this subchapter,
or who are ineligible under Sec. 127.7(c) of this subchapter are
generally ineligible. Applications for licenses or other approvals will
be considered only if the applicant has registered with the Directorate
of Defense Trade Controls pursuant to part 122 of this subchapter. All
applications and requests for approval must be signed by a U.S. person
who has been empowered by the registrant to sign such documents.
* * * * *
0
3. Section 120.4 is amended by revising paragraphs (a), (b),
(d)(3)(ii), (d)(3)(iii), (e), and (g), to read as follows:
Sec. 120.4 Commodity jurisdiction.
(a) The commodity jurisdiction procedure is used with the U.S.
Government if doubt exists as to whether an article or service is
covered by the U.S. Munitions List. It may also be used for
consideration of a redesignation of an article or service currently
covered by the U.S. Munitions List. The Department must provide notice
to Congress at least 30 days before any item is removed from the U.S.
Munitions List. Upon written request, the Directorate of Defense Trade
Controls shall provide a determination of whether a particular article
or service is covered by the U.S. Munitions List. The determination,
consistent with Sec. Sec. 120.2, 120.3, and 120.4, entails
consultation among the Departments of State, Defense, Commerce and
other U.S. Government agencies and industry in appropriate cases.
(b) Registration with the Directorate of Defense Trade Controls as
defined in part 122 of this subchapter is not required prior to
submission of a commodity jurisdiction request. If it is determined
that the commodity is a defense article or defense service covered by
the U.S. Munitions List, registration is required for exporters,
manufacturers, and furnishers of such defense articles and defense
services (see part 122 of this subchapter), as well as for brokers who
are engaged in brokering activities related to such articles or
services.
* * * * *
(d) * * *
(3) * * *
(ii) The nature of controls imposed by other nations on such items
(including Wassenaar Arrangement and other multilateral controls), and
(iii) That items described on the Wassenaar Arrangement List of
Dual-Use Goods and Technologies shall not be designated defense
articles or defense services unless the failure to control such items
on the U.S. Munitions List would jeopardize significant national
security or foreign policy interests.
(e) The Directorate of Defense Trade Controls will provide a
preliminary response within 10 working days of receipt of a complete
request for commodity jurisdiction. If after 45 days the Directorate of
Defense Trade Controls has not provided a final commodity jurisdiction
determination, the applicant may request in writing to the Director,
Office of Defense Trade Controls Policy that this determination be
given expedited processing.
* * * * *
(g) A person may appeal a commodity jurisdiction determination by
[[Page 20537]]
submitting a written request for reconsideration to the Managing
Director of the Directorate of Defense Trade Controls. The Directorate
of Defense Trade Controls will provide a written response of the
Managing Director's determination within 30 days of receipt of the
appeal. If desired, an appeal of the Managing Director's decision can
then be made directly through the Deputy Assistant Secretary for
Defense Trade Controls to the Assistant Secretary for Political-
Military Affairs.
0
4. Section 120.5 is revised to read as follows:
Sec. 120.5 Relation to regulations of other agencies.
If an article or service is covered by the U.S. Munitions List, its
export is regulated by the Department of State, except as indicated
otherwise in this subchapter. For the relationship of this subchapter
to regulations of the Department of Energy and the Nuclear Regulatory
Commission, see Sec. 123.20 of this subchapter. The Attorney General
controls permanent imports of articles and services covered by the U.S.
Munitions Import List from foreign countries by persons subject to U.S.
jurisdiction (27 CFR part 447). In carrying out such functions, the
Attorney General shall be guided by the views of the Secretary of State
on matters affecting world peace, and the external security and foreign
policy of the United States. The Department of Commerce regulates the
export of items on the Commerce Control List (CCL) under the Export
Administration Regulations (15 CFR parts 730 through 799).
0
5. Section 120.10 is amended by revising paragraph (a)(1) to read as
follows:
Sec. 120.10 Technical data.
(a) * * *
(1) Information, other than software as defined in Sec.
120.10(a)(4), which is required for the design, development,
production, manufacture, assembly, operation, repair, testing,
maintenance or modification of defense articles. This includes
information in the form of blueprints, drawings, photographs, plans,
instructions or documentation.
* * * * *
0
6. Section 120.12 is revised to read as follows:
Sec. 120.12 Directorate of Defense Trade Controls.
Directorate of Defense Trade Controls, Bureau of Political-Military
Affairs, Department of State, Washington, DC 20522-0112.
0
7. Section 120.15 is revised to read as follows:
Sec. 120.15 U.S. person.
U.S. person means a person (as defined in Sec. 120.14 of this
part) who is a lawful permanent resident as defined by 8 U.S.C.
1101(a)(20) or who is a protected individual as defined by 8 U.S.C.
1324b(a)(3). It also means any corporation, business association,
partnership, society, trust, or any other entity, organization or group
that is incorporated to do business in the United States. It also
includes any governmental (federal, state or local) entity. It does not
include any foreign person as defined in Sec. 120.16 of this part.
0
8. Section 120.16 is revised to read as follows:
Sec. 120.16 Foreign person.
Foreign person means any natural person who is not a lawful
permanent resident as defined by 8 U.S.C. 1101(a)(20) or who is not a
protected individual as defined by 8 U.S.C. 1324b(a)(3). It also means
any foreign corporation, business association, partnership, trust,
society or any other entity or group that is not incorporated or
organized to do business in the United States, as well as international
organizations, foreign governments and any agency or subdivision of
foreign governments (e.g., diplomatic missions).
0
9. Section 120.18 is revised to read as follows:
Sec. 120.18 Temporary import.
Temporary import means bringing into the United States from a
foreign country any defense article that is to be returned to the
country from which it was shipped or taken, or any defense article that
is in transit to another foreign destination. Temporary import includes
withdrawal of a defense article from a customs bonded warehouse or
foreign trade zone for the purpose of returning it to the country of
origin or country from which it was shipped or for shipment to another
foreign destination. Permanent imports are regulated by the Attorney
General under the direction of the Department of Justice's Bureau of
Alcohol, Tobacco, Firearms, and Explosives (see 27 CFR parts 447, 478,
479, and 555).
0
10. Section 120.20 is revised to read as follows:
Sec. 120.20 License.
License means a document bearing the word ``license'' issued by the
Directorate of Defense Trade Controls or its authorized designee which
permits the export or temporary import of a specific defense article or
defense service controlled by this subchapter.
0
11. Section 120.27 is amended by revising paragraph (a)(3) and adding a
new paragraph (a)(13) to read as follows:
Sec. 120.27 U.S. criminal statutes.
(a) * * *
(3) Sections 793, 794, or 798 of title 18, United States Code
(relating to espionage involving defense or classified information) or
Sec. 2339A of such title (relating to providing material support to
terrorists);
* * * * *
(13) Sections 3, 4, 5, and 6 of the Prevention of Terrorist Access
to Destructive Weapons Act of 2004, relating to missile systems
designed to destroy aircraft (18 U.S.C. 2332g), prohibitions governing
atomic weapons (42 U.S.C. 2122), radiological dispersal services (18
U.S.C. 2332h), and variola virus (18 U.S.C. 175b);
* * * * *
0
12. Section 120.28 is amended by revising paragraphs (a) introductory
text and (b)(3) to read as follows:
Sec. 120.28 Listing of forms referred to in this subchapter.
* * * * *
(a) Department of State, Bureau of Political-Military Affairs,
Directorate of Defense Trade Controls, Washington, DC 20522-0112.
* * * * *
(b) * * *
(3) Department of Defense, Defense Security Cooperation Agency:
Letter of Offer and Acceptance (DD Form 1513).
PART 121--THE UNITED STATES MUNITIONS LIST
0
13. The authority citation for part 121 is revised to read as follows:
Authority: Secs. 2, 38, and 71, Pub. L. 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; Pub. L. 105-261, 112 Stat. 1920.
0
14. Section 121.1 is revised to read as follows:
0
A. Revise paragraphs (a) and (b)
0
B. In paragraph (c) in Category IV revise paragraph (i)
0
C. In paragraph (c) in Category V revise paragraphs (a)(1), (a)(2),
(a)(5), (a)(9), (a)(15)(i), (a)(20)(i), (a)(24)(ii), (a)(29),
(a)(31)(i), (a)(31)(ii), (a)(31)(iv), (a)(31)(vii), (a)(34), (c)(8),
(c)(9), (e)(2), (e)(9), (e)(11), (e)(13), (e)(14), (e)(15), (f)(3)(iv),
(f)(14), (f)(15), (f)(17), (g)(2), (g)(5), (g)(6), (g)(7), (g)(8), and
(h)
0
D. In paragraph (c) in Category XI revise paragraph (d)
0
E. In paragraph (c) in Category XII revise paragraph (f)
[[Page 20538]]
0
F. In paragraph (c) in Category XIV revise paragraph (m)
0
G. In paragraph (c) in Category XV revise paragraphs (d)(1), (d)(2),
(d)(3), and (d)(5)
0
H. In paragraph (c) in Category XVII revise paragraph (a)
0
I. In paragraph (c) in Category XX revise paragraph (d)
0
J. In paragraph (c) in Category XXI revise paragraphs (a) and (b)
Sec. 121.1 General. The United States Munitions List.
(a) The following articles, services and related technical data are
designated as defense articles and defense services pursuant to
Sec. Sec. 38 and 47(7) of the Arms Export Control Act (22 U.S.C. 2778
and 2794(7)). Changes in designations will be published in the Federal
Register. Information and clarifications on whether specific items are
defense articles and services under this subchapter may appear
periodically through the Internet Web site of the Directorate of
Defense Trade Controls.
(b) Significant Military Equipment: An asterisk precedes certain
defense articles in the following list. The asterisk means that the
article is deemed to be ``Significant Military Equipment'' to the
extent specified in Sec. 120.7 of this subchapter. The asterisk is
placed as a convenience to help identify such articles. Note that
technical data directly related to the manufacture or production of any
defense articles enumerated in any category that are designated as
Significant Military Equipment (SME) shall itself be designed SME.
(c) * * *
* * * * *
Category IV--Launch Vehicles, Guided Missiles, Ballistic Missiles,
Rockets, Torpedoes, Bombs and Mines
* * * * *
(i) Technical data (as defined in Sec. 120.10 of this
subchapter) and defense services (as defined in Sec. 120.9 of this
subchapter) directly related to the defense articles enumerated in
paragraphs (a) through (h) of this category. (See Sec. 125.4 of
this subchapter for exemptions.) Technical data directly related to
the manufacture or production of any defense articles enumerated
elsewhere in this category that are designated as Significant
Military Equipment (SME) shall itself be designated SME.
Category V--Explosives and Energetic Materials, Propellants, Incendiary
Agents and Their Constituents
(a) * * *
(1) ADNBF (aminodinitrobenzofuroxan or 7-Amino 4,6-
dinitrobenzofurazane-1-oxide) (CAS 97096-78-1);
(2) BNCP (cis-bis (5-nitrotetrazolato) tetra amine-cobalt (III)
perchlorate) (CAS 117412-28-9);
* * * * *
(5) CP (2-(5-cyanotetrazolato) penta aminecobalt (III)
perchlorate); (CAS 70247-32-4);
* * * * *
(9) DIPAM (3,3'-Diamino-2,2',4,4',6,6'-hexanitrobiphenyl or
dipicramide) (CAS 17215-44-0);
* * * * *
(15) * * *
(i) BNNII (Octohydro-2,5-bis(nitroimino) imidazo [4,5-
d]Imidazole);
* * * * *
(20) * * *
(i) RDX (cyclotrimethylenetrinitramine), cyclonite, T4,
hexahydro-1,3,5-trinitro-1,3,5-triazine, 1,3,5-trinitro-1,3,5-
triaza-cyclohexane, hexogen, or hexogene) (CAS 121-82-4);
* * * * *
(24) * * *
* * * * *
(ii) NTNT (1-N-(2-nitrotriazolo)-4-nitrotetrazole);
* * * * *
(29) TNP (1,4,5,8-tetranitro-pyridazino [4,5-d] pyridazine) (CAS
229176-04-9);
* * * * *
(31) * * *
(i) 5-azido-2-nitrotriazole;
(ii) ADHTDN (4-amino-3,5-dihydrazino-1,2,4-triazole
dinitramide)(CAS 1614-08-0);
* * * * *
(iv) BDNTA ([Bis-dinitrotriazole]amine);
* * * * *
(vii) NTDNA (2-nitrotriazole 5-dinitramide) (CAS 75393-84-9);
* * * * *
(34) Diaminotrinitrobenzene (DATB) (CAS 1630-08-6);
* * * * *
(c) * * *
(8) Titanium subhydride (TiHn) of stoichiometry equivalent to n
= 0.65-1.68;
(9) Military materials containing thickeners for hydrocarbon
fuels specially formulated for use in flame throwers or incendiary
munitions; metal stearates or palmates (also known as octol); and
M1, M2 and M3 thickeners;
* * * * *
(e) * * *
(2) BAMO (bisazidomethyloxetane and its polymers) (CAS 17607-20-
4) (see paragraph (g)(1)of this category);
* * * * *
(9) Poly-NIMMO (poly nitratomethylmethyoxetane, poly-NMMO,
(poly[3-nitratomethyl-3-methyl oxetane]) (CAS 84051-81-0);
* * * * *
(11) TVOPA 1,2,3-Tris [1,2-bis(difluoroamino) ethoxy]propane;
tris vinoxy propane adduct; (CAS 53159-39-0);
* * * * *
(13) FPF-1 (poly-2,2,3,3,4,4-hexafluoro pentane-1,5-diolformal)
(CAS 376-90-9);
(14) FPF-3 (poly-2,4,4,5,5,6,6-heptafluoro-2-trifluoromethyl-3-
oxaheptane-1,7-diolformal);
(15) PGN (Polyglycidylnitrate or poly(nitratomethyl oxirane);
poly-GLYN); (CAS 27814-48-8);
* * * * *
(f) * * *
(3) * * *
(iv) n-butyl-ferrocene (CAS 31904-29-7);
* * * * *
(14) Polyfunctional aziridine amides with isophthalic, trimesic
(BITA or butylene imine trimesamide), isocyanuric, or
trimethyladipic backbone structures and 2-methyl or 2-ethyl
substitutions on the aziridine ring and its polymers;
(15) Superfine iron oxide (Fe2O3 hematite)
with a specific surface area more than 250 m\2\/g and an average
particle size of 0.003 [micro]m or less (CAS 1309-37-1);
* * * * *
(17) TEPANOL (Tetraethylenepentaamineacrylo- nitrileglycidol)
(CAS 110445-33-5); cyanoethylated polyamines adducted with glycidol
and their salts;
* * * * *
(g) * * *
(2) Dinitroazetidine-t-butyl salt (CAS 125735-38-8) (see
paragraph (a)(27) of this category);
* * * * *
(5) TAT (1, 3, 5, 7-tetraacetyl-1, 3, 5, 7-tetraaza-cyclooctane)
(CAS 41378-98-7) (see paragraph (a)(12) of this category);
(6) Tetraazadecalin (CAS 5409-42-7) (see paragraph (a)(26) of
this category);
(7) 1,3,5-trichorobenzene (CAS 108-70-3) (see paragraph (a)(22)
of this category);
(8) 1,2,4-trihydroxybutane (1,2,4-butanetriol) (CAS 3068-00-6) (see
paragraph (e)(3) of this category);
(h) Technical data (as defined in Sec. 120.10 of this subchapter)
and defense services (as defined in Sec. 120.9 of this subchapter)
directly related to the defense articles numerated in paragraphs (a)
through (g) of this category. (See Sec. 125.4 of this subchapter for
exemptions.) Technical data directly related to the manufacture or
production of any defense articles enumerated elsewhere in this
category that are designated as Significant Military Equipment (SME)
shall itself be designated SME.
* * * * *
Category XI--Military Electronics
* * * * *
(d) Technical data (as defined in Sec. 120.10) and defense
services (as defined in Sec. 120.9) directly related to the defense
articles enumerated in paragraphs (a) through (c) of this category.
(See Sec. 125.4 for exemptions.) Technical data directly related to
the manufacture or production of any defense articles enumerated
elsewhere in this category that are designated as Significant Military
Equipment (SME) shall itself be designated as SME.
Category XII--Fire Control, Range Finder, Optical and Guidance and
Control Equipment
* * * * *
[[Page 20539]]
(f) Technical data (as defined in Sec. 120.10) and defense
services (as defined in Sec. 120.9) directly related to the defense
articles enumerated in paragraphs (a) through (e) of this category.
(See Sec. 125.4 for exemptions.) Technical data directly related to
manufacture and production of any defense articles enumerated elsewhere
in this category that are designated as Significant Military Equipment
(SME) shall itself be designated as SME.
* * * * *
Category XIV--Toxicological Agents, Including Chemical Agents,
Biological Agents, and Associated Equipment
* * * * *
(m) Technical data (as defined in Sec. 120.10 of this subchapter)
and defense services (as defined in Sec. 120.9 of this subchapter)
related to the defense articles enumerated in paragraphs (a) through
(l) of this category. (See Sec. 125.4 of this subchapter for
exemptions.) Technical data directly related to the manufacture or
production of any defense articles enumerated elsewhere in this
Category that are designated as Significant Military Equipment (SME)
shall itself be designated as SME.
* * * * *
Category XV--Spacecraft Systems and Associated Equipment
* * * * *
(d) * * *
(1) A total dose of 5 x 10\5\ Rads (SI);
(2) A dose rate upset of 5 x 10\8\ Rads (SI)/sec;
(3) A neutron dose of 1 x 10\14\ N/cm2;
* * * * *
(5) Single event latch-up free and having a dose rate latch-up of 5
x 10\8\ Rads (SI)/sec or greater.
* * * * *
Category XVII--Classified Articles, Technical Data and Defense Services
Not Otherwise Enumerated
(a) All articles, technical data (as defined in Sec. 120.10 of
this subchapter) and defense services (as defined in Sec. 120.9 of
this subchapter) relating thereto which are classified in the interests
of national security and which are not otherwise enumerated in the U.S.
Munitions List.
* * * * *
Category XX--Submersible Vessels, Oceanographic and Associated
Equipment
* * * * *
(d) Technical data (as defined in Sec. 120.10 of this subchapter)
and defense services (as defined in Sec. 120.9 of this subchapter)
directly related to the defense articles enumerated in paragraphs (a)
through (c) of this category. (See Sec. 125.4 of this subchapter for
exemptions.) Technical data directly related to the manufacture or
production of any defense articles enumerated elsewhere in this
Category that are designated as Significant Military Equipment (SME)
shall itself be designated as SME.
Category XXI--Miscellaneous Articles
(a) Any article not specifically enumerated in the other categories
of the U.S. Munitions List which has substantial military applicability
and which has been specifically designed, developed, configured,
adapted, or modified for military purposes. The decision on whether any
article may be included in this category shall be made by the Director,
Office of Defense Trade Controls Policy.
(b) Technical data (as defined in Sec. 120.10 of this subchapter)
and defense services (as defined in Sec. 120.9 of this subchapter)
directly related to the defense articles enumerated in paragraph (a) of
this category.
0
15. Section 121.16 is amended as follows:
0
A. Revise Item 1--Category I.
0
B. Revise Item 4--Category II.
0
C. In Item 9--Category II revise paragraph (b).
0
D. In Item 12--Category II revise paragraph (d)(2) introductory text.
0
E. In Item 18--Category II revise Note to Item 18(a).
Sec. 121.16 Missile Technology Control Regime Annex.
* * * * *
Item 1--Category I
Complete rocket systems (including ballistic missile systems,
space launch vehicles, and sounding rockets (see Sec. 121.1, Cat.
IV(a) and (b))) and unmanned air vehicle systems (including cruise
missile systems, see Sec. 121.1, Cat. VIII (a), target drones and
reconnaissance drones (see Sec. 121.1, Cat. VIII (a))) capable of
delivering at least a 500 kg payload to a range of at least 300 km.
* * * * *
Item 4--Category II
Propellants and constituent chemicals for propellants as
follows:
(a) Propulsive substances:
(1) Hydrazine with a concentration of more than 70 percent and
its derivatives including monomethylhydrazine (MMH);
(2) Unsymmetric dimethylhydrazine (UDHM);
(3) Ammonium perchlorate;
(4) Sphercical aluminum powder with particle of uniform diameter
of less than 500 x 10-\6\M (500 microns) and an aluminum
content of 97 percent or greater;
(5) Metal fuels in particle sizes less than 500 x
10-\6\M (500 microns), whether spherical, atomized,
spheriodal, flaked or ground, consisting of 97 percent or more of
any of the following: zirconium, beryllium, boron, magnesium, zinc,
and alloys of these;
(6) Nitroamines (cyclotetramethylenetetranitramene (HMX),
cyclotrimethylenetrinitramine (RDX);
(7) Percholrates, chlorates or chromates mixed with powdered
metals or other high energy fuel components;
(8) Carboranes, decaboranes, pentaboranes and derivatives
thereof;
(9) Liquid oxidizers, as follows:
(i) Nitrogen dioxide/dinitrogen tetroxide;
(ii) Inhibited Red Fuming Nitric Acid (IRFNA);
(iii) Compounds composed of fluorine and one or more of other
halogens, oxygen or nitrogen.
(b) Polymeric substances:
(1) Hydroxyterminated polybutadiene (HTPB);
(2) Glycidylazide polymer (GAP).
(c) Other high energy density propellants such a Boron Slurry
having an energy density of 40 x 10 joules/kg or greater.
(d) Other propellants additives and agents:
(1) Bonding agents as follows:
(i) Tris (1(2methyl)aziridinyl phosphine oxide (MAPO);
(ii) Trimesol 1(2)ethyl)aziridine (HX868, BITA);
(iii) ``Tepanol'' (HX878), reaction product of
tetraethylenepentamine, acrylonitrile and glycidol;
(iv) ``Tepan'' (HX879), reaction product of tet enepentamine and
acrylonitrile;
(v) Polyfunctional aziridene amides with isophthalic, trimesic,
isocyanuric, or trimethyladipic backbone also having a 2methyl or
2ethyl aziridine group (HX752, HX872 and HX877).
(2) Curing agents and catalysts as follows:
(i) Triphenyl bismuth (TPB);
(ii) Burning rate modifiers as follows:
(iii) Catocene;
(iv) Nbutylferrocene;
(v) Other ferrocene derivatives.
(3) Nitrate esters and nitrato plasticizers as follows:
(i) 1,2,4butanetriol trinitrate (BTTN).
(4) Stabilizers as follows:
(i) Nmethylpnitroaniline.
* * * * *
Item 9--Category II
* * * * *
(b) Gyro-astro compasses and other devices which derive position
or orientation by means of automatically tracking celestial bodies
or satellites (see Sec. 121.1, Category XV(d));
* * * * *
Item 12--Category II
* * * * *
(d) * * *
(2) Range instrumentation radars including associated optical/
infrared trackers and the specially designed software therefor with
all of the following capabilities (see Sec. 121.1, Category
XI(a)(3)):
* * * * *
Item 18--Category II
* * * * *
Note to Item 18(a)
A detector is defined as a mechanical, electrical, optical or
chemical device that automatically identifies and records, or
registers a stimulus such as an environmental change in pressure or
temperature, an electrical or electromagnetic signal or radiation
from a radioactive material. The following pages were removed from
the final ITAR for replacement by DDTC's updated version Sec. 6(l)
of the Export Administration Act of 1979 (50 U.S.C. App. 2405(l)),
as amended. In accordance with this provision, the list of MTCR
Annex items shall constitute all items on the U.S. Munitions List in
Sec. 121.16.
[[Page 20540]]
PART 122--REGISTRATION OF MANUFACTURERS AND EXPORTERS
0
16. The authority citation for part 122 continues to read as follows:
Authority: Secs. 2 and 38, Pub. L. 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
17. Section 122.1 is amended by revising paragraph (a) to read as
follows:
Sec. 122.1 Registration requirements.
(a) Any person who engages in the United States in the business of
either manufacturing or exporting defense articles or furnishing
defense services is required to register with the Directorate of
Defense Trade Controls. For the purpose of this subchapter, engaging in
the business of manufacturing or exporting defense articles or
furnishing defense services requires only one occasion of manufacturing
or exporting a defense article or furnishing a defense service.
Manufacturers who do not engage in exporting must nevertheless
register.
* * * * *
0
18. Section 122.2 is amended by revising paragraph (b) introductory
text to read as follows:
Sec. 122.2 Submission of registration statement.
(a) * * *
(b) Transmittal letter. A letter of transmittal, signed by an
authorized senior officer of the intended registrant, shall accompany
each Statement of Registration.
* * * * *
0
19. Section 122.4 is amended by revising paragraphs (a) introductory
text, (a)(2), (b), (c) introductory text, (c)(4) and (d) to read as
follows:
Sec. 122.4 Notification of changes in information furnished by
registrants.
(a) A registrant must, within five days of the event, notify the
Directorate of Defense Trade Controls by registered mail if:
* * * * *
(2) There is a material change in the information contained in the
Statement of Registration, including a change in the senior officers;
the establishment, acquisition or divestment of a subsidiary or foreign
affiliate; a merger; a change of location; or the dealing in an
additional category of defense articles or defense services.
(b) A registrant must notify the Directorate of Defense Trade
Controls by registered mail at least 60 days in advance of any intended
sale or transfer to a foreign person of ownership or control of the
registrant or any entity thereof. Such notice does not relieve the
registrant from obtaining the approval required under this subchapter
for the export of defense articles or defense services to a foreign
person, including the approval required prior to disclosing technical
data. Such notice provides the Directorate of Defense Trade Controls
with the information necessary to determine whether the authority of
Sec. 38(g)(6) of the Arms Export Control Act regarding licenses or
other approvals for certain sales or transfers of defense articles or
data on the U.S. Munitions List should be invoked (see Sec. Sec.
120.10 and 126.1(e) of this subchapter).
(c) The new entity formed when a registrant merges with another
company or acquires, or is acquired by, another company or a subsidiary
or division of another company shall advise the Directorate of Defense
Trade Controls of the following:
* * * * *
(4) Amendments to agreements approved by the Directorate of Defense
Trade Controls to change the name of a party to those agreements. The
registrant must, within 60 days of this notification, provide to the
Directorate of Defense Trade Controls a signed copy of an amendment to
each agreement signed by the new U.S. entity, the former U.S. licensor
and the foreign licensee. Any agreements not so amended will be
considered invalid.
(d) Prior approval by the Directorate of Defense Trade Controls is
required for any amendment making a substantive change.
PART 123--LICENSES FOR THE EXPORT OF DEFENSE ARTICLES
0
20. The authority citation for part 123 continues to read as follows:
Authority: Secs. 2, 38, and 71, Pub. L. 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; Pub. L. 105-
261, 112 Stat. 1920; Sec 1205(a), Pub. L. 107-228.
0
21. Section 123.1 is amended by revising paragraphs (a) introductory
text and (c) introductory text to read as follows:
Sec. 123.1 Requirement for export or temporary import licenses.
(a) Any person who intends to export or to import temporarily a
defense article must obtain the approval of the Directorate of Defense
Trade Controls prior to the export or temporary import, unless the
export or temporary import qualifies for an exemption under the
provisions of this subchapter. Applications for export or temporary
import must be made as follows:
* * * * *
(c) As a condition to the issuance of a license or other approval,
the Directorate of Defense Trade Controls may require all pertinent
documentary information regarding the proposed transaction and proper
completion of the application form as follows:
* * * * *
0
22. Section 123.2 is revised to read as follows:
Sec. 123.2 Import jurisdiction.
The Department of State regulates the temporary import of defense
articles. Permanent imports of defense articles into the United States
are regulated by the Department of the Justice's Bureau of Alcohol,
Tobacco, Firearms and Explosives under the direction of the Attorney
General (see 27 CFR parts 447, 478, 479, and 555).
0
23. Section 123.3 is amended by revising paragraph (a) introductory
text to read as follows:
Sec. 123.3 Temporary import licenses.
(a) A license (DSP-61) issued by the Directorate of Defense Trade
Controls is required for the temporary import and subsequent export of
unclassified defense articles, unless exempted from this requirement
pursuant to Sec. 123.4. This requirement applies to:
* * * * *
0
24. 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 National Industrial Security Program
Operating 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
25. Section 123.8 is revised to read as follows:
[[Page 20541]]
Sec. 123.8 Special controls on vessels, aircraft and satellites
covered by the U.S. Munitions List.
(a) Transferring registration or control to a foreign person of any
aircraft, vessel, or satellite on the U.S. Munitions List is an export
for purposes of this subchapter and requires a license or written
approval from the Directorate of Defense Trade Controls. This
requirement applies whether the aircraft, vessel, or satellite is
physically located in the United States or abroad.
(b) The registration in a foreign country of any aircraft, vessel
or satellite covered by the U.S. Munitions List which is not registered
in the United States but which is located in the United States
constitutes an export. A license or written approval from the
Directorate of Defense Trade Controls is therefore required. Such
transactions may also require the prior approval of the U.S. Department
of Transportation's Maritime Administration, the Federal Aviation
Administration or other agencies of the U.S. Government.
0
26. Section 123.9 is amended by revising paragraphs (a), (d), (e)
introductory text, (e)(3) and (e)(4) to read as follows:
Sec. 123.9 Country of ultimate destination and approval of reexports
or retransfers.
(a) The country designated as the country of ultimate destination
on an application for an export license, or on a Shipper's Export
Declaration where an exemption is claimed under this subchapter, must
be the country of ultimate end-use. The written approval of the
Directorate of Defense Trade Controls must be obtained before
reselling, transferring, transshipping, or disposing of a defense
article to any end user, end use or destination other than as stated on
the export license, or on the Shipper's Export Declaration in cases
where an exemption is claimed under this subchapter. Exporters must
ascertain the specific end-user and end-use prior to submitting an
application to the Directorate of Defense Trade Controls or claiming an
exemption under this subchapter.
* * * * *
(d) The written approval of the Directorate of Defense Trade
Controls must be obtained before reselling, transferring, transshipping
on a non-continuous voyage, or disposing of a defense article in any
country other than the country of ultimate destination, or anyone other
than the authorized end-user, as stated on the Shipper's Export
Declaration in cases where an exemption is claimed under this
subchapter.
(e) Reexports or retransfers of U.S.-origin components incorporated
into a foreign defense article to a government of a NATO country, or
the governments of Australia or Japan, are authorized without the prior
written approval of the Directorate of Defense Trade Controls,
provided:
* * * * *
(3) The person reexporting the defense article must provide written
notification to the Directorate of Defense Trade Controls of the
retransfer not later than 30 days following the reexport. The
notification must state the articles being reexported and the recipient
government.
(4) In certain cases, the Managing Director, Directorate of Defense
Trade Controls or the Director, Office of Defense Trade Controls
Licensing, may place retransfer restrictions on a license prohibiting
use of this exemption.
0
27. Section 123.10 is revised to read as follows:
Sec. 123.10 Non-transfer and use assurances.
(a) A nontransfer and use certificate (Form DSP-83) is required for
the export of significant military equipment and classified articles,
including classified technical data. A license will not be issued until
a completed Form DSP-83 has been received by the Directorate of Defense
Trade Controls. This form is to be executed by the foreign consignee,
foreign end-user, and the applicant. The certificate stipulates that,
except as specifically authorized by prior written approval of the
Department of State, the foreign consignee and foreign end-user will
not reexport, resell or otherwise dispose of the significant military
equipment enumerated in the application outside the country named as
the location of the foreign end-use or to any other person.
(b) The Directorate of Defense Trade Controls may also require a
DSP-83 for the export of any other defense articles, including
technical data, or defense services.
(c) When a DSP-83 is required for an export of any defense article
or defense service to a non-governmental foreign end-user, the
Directorate of Defense Trade Controls may require as a condition of
issuing the license that the appropriate authority of the government of
the country of ultimate destination also execute the certificate.
0
28. Section 123.11 is amended by revising paragraph (a) to read as
follows:
Sec. 123.11 Movements of vessels and aircraft covered by the U.S.
Munitions List outside the United States.
(a) A license issued by the Directorate of Defense Trade Controls
is required whenever a privately-owned aircraft or vessel on the U.S.
Munitions List makes a voyage outside the United States.
* * * * *
0
29. Section 123.14 is amended by revising paragraph (b) to read as
follows:
Sec. 123.14 Import certificate/delivery verification procedure.
(a) * * *
(b) Exports. The Directorate of Defense Trade Controls may require
the IC/DV procedure on proposed exports of defense articles to non-
government entities in those countries participating in IC/DV
procedures. In such cases, U.S. exporters must submit both an export
license application (the completed Form DSP-5) and the original Import
Certificate, which must be provided and authenticated by the government
of the importing country. This document verifies that the foreign
importer complied with the import regulations of the government of the
importing country and that the importer declared the intention not to
divert, transship or reexport the material described therein without
the prior approval of that government. After delivery of the
commodities to the foreign consignee, the Directorate of Defense Trade
Controls may also require U.S. exporters to furnish Delivery
Verification documentation from the government of the importing
country. This documentation verifies that the delivery was in
accordance with the terms of the approved export license. Both the
Import Certificate and the Delivery Verification must be furnished to
the U.S. exporter by the foreign importer.
* * * * *
0
30. Section 123.16 is amended by revising paragraph (b)(2)(v) to read
as follows:
Sec. 123.16 Exemptions of general applicability.
(a) * * *
(b) * * *
(2) * * *
(v) the exporter may not make more than 24 shipments per calendar
year to the previously authorized end user;
* * * * *
0
31. Section 123.17 is amended by revising paragraph (d) to read as
follows:
Sec. 123.17 Exports of firearms and ammunition.
* * * * *
(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
[[Page 20542]]
therefor as the foreign person brought into the United States under the
provisions of 27 CFR 478.115(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.)
* * * * *
0
32. Section 123.25 is amended by revising paragraph (a) to read as
follows:
Sec. 123.25 Amendments to licenses.
(a) The Directorate of Defense Trade Controls may approve an
amendment to a license for permanent export, temporary export and
temporary import of unclassified defense articles. A suggested format
is available from the Directorate of Defense Trade Controls.
* * * * *
0
33. Section 123.27 is amended by revising paragraphs (a) introductory
text, (a)(2), (a)(5), (a)(6), (b), and (c) 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) U.S. persons engaged in the business of exporting specifically
designed or modified components, systems, parts, accessories,
attachments, associated equipment and certain associated technical data
for commercial communications satellites, and who are so registered
with the Directorate of Defense Trade Controls pursuant to part 122 of
this subchapter, may submit license applications for multiple permanent
and temporary exports and temporary imports of such articles for
expeditious consideration without meeting the documentary requirements
of Sec. 123.1(c)(4) and (5) concerning purchase orders, letters of
intent, contracts and non-transfer and end use certificates, or the
documentary requirements of Sec. 123.9, concerning approval of re-
exports or re-transfers, when all of the following requirements are
met:
* * * * *
(2) The proposed exports concern exclusively one or more foreign
persons (e.g., companies or governments) located within the territories
of the countries identified in paragraph (a)(1) of this section, and
one or more commercial communications satellite programs included
within a list of such persons and programs approved by the U.S.
Government for purposes of this section, as signified in a list of such
persons and programs that will be publicly available through the
Internet Web site of the Directorate of Defense Trade Controls and by
other means.
* * * * *
(5) The U.S. exporter provides complete shipment information to the
Directorate of Defense Trade Controls within 15 days of shipment by
submitting a report containing a description of the item and the
quantity, value, port of exit, and end-user and country of destination
of the item, and at that time meets the documentary requirements of
Sec. 123.1(c)(4) and (5), the documentary requirements of Sec. 123.9
in the case of re-exports or re-transfers, and, other documentary
requirements that may be imposed as a condition of a license (e.g.,
parts control plans for MTCR-controlled items). The shipment
information reported must include a description of the item and
quantity, value, port of exit and end user and country of destination
of the item.
(6) At any time in which an item exported pursuant to this section
is proposed for re-transfer outside of the approved territory, programs
or persons (e.g., such as in the case of an item included in a
satellite for launch beyond the approved territory), the detailed
requirements of Sec. 123.9 apply with regard to obtaining the prior
written consent of the Directorate of Defense Trade Controls.
(b) The re-export or re-transfer of the articles authorized for
export (including to specified re-export destinations) in accordance
with this section do not require the separate prior written approval of
the Directorate of Defense Trade Controls provided all of the
requirements in paragraph (a) of this section are met.
(c) The Directorate of Defense Trade Controls will consider, on a
case-by-case basis, requests to include additional foreign companies
and satellite programs within the geographic coverage of a license
application submitted pursuant to this section from countries not
otherwise covered, who are members of the European Space Agency or the
European Union. In no case, however, can the provisions of this section
apply or be relied upon by U.S. exporters in the case of countries who
are subject to the mandatory requirements of Section 1514 of the Strom
Thurmond National Defense Authorization Act for Fiscal Year 1999 (Pub.
L. 105-261), concerning national security controls on satellite export
licensing.
* * * * * *
PART 124--AGREEMENTS, OFF-SHORE PROCUREMENT AND OTHER DEFENSE
SERVICES
0
34. The authority citation for part 124 continues to read as follows:
Authority: Secs. 2, 38, and 71, Pub. L. 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; Pub. L. 105-261.
0
35. Section 124.1 is revised to read as follows:
Sec. 124.1 Manufacturing license agreements and technical assistance
agreements.
(a) Approval. The approval of the Directorate of Defense Trade
Controls must be obtained before the defense services described in
Sec. 120.9(a) of this subchapter may be furnished. In order to obtain
such approval, the U.S. person must submit a proposed agreement to the
Directorate of Defense Trade Controls. Such agreements are generally
characterized as manufacturing license agreements, technical assistance
agreements, distribution agreements, or off-shore procurement
agreements, and may not enter into force without the prior written
approval of the Directorate of Defense Trade Controls. Once approved,
the defense services described in the agreements may generally be
provided without further licensing in accordance with Sec. Sec. 124.3
and 125.4(b)(2) of this subchapter. The requirements of this section
apply whether or not technical data is to be disclosed or used in the
performance of the defense services described in Sec. 120.9(a) of this
subchapter (e.g., all the information relied upon by the U.S. person in
performing the defense service is in the public domain or is otherwise
exempt from the licensing requirements of this subchapter pursuant to
Sec. 125.4 of this subchapter). This requirement also applies to the
training of any foreign military forces, regular and irregular, in the
use of defense articles. Technical assistance agreements must be
submitted in such cases. In exceptional cases, the Directorate of
Defense Trade Controls, upon written request, will consider approving
the provision of defense services described in Sec. 120.9(a) of this
subchapter by granting a license under part 125 of this subchapter.
Also, see Sec. 126.8 of this subchapter for the requirements for prior
approval of proposals relating to significant military equipment.
(b) Classified articles. Copies of approved agreements involving
the release of classified defense articles will be forwarded by the
Directorate of Defense Trade Controls to the Defense
[[Page 20543]]
Security Service of the Department of Defense.
(c) Amendments. Changes to the scope of approved agreements,
including modifications, upgrades, or extensions must be submitted for
approval. The amendments may not enter into force until approved by the
Directorate of Defense Trade Controls.
(d) Minor amendments. Amendments which only alter delivery or
performance schedules, or other minor administrative amendments which
do not affect in any manner the duration of the agreement or the
clauses or information which must be included in such agreements
because of the requirements of this part, do not have to be submitted
for approval. One copy of all such minor amendments must be submitted
to the Directorate of Defense Trade Controls within thirty days after
they are concluded.
0
36. Section 124.2 is amended by revising paragraph (c)(5)(ix) to read
as follows:
Sec. 124.2 Exemptions for training and military service.
* * * * *
(c) * * *
(5) * * *
(ix) Nuclear radiation measuring devices manufactured to military
specifications listed in Category XVI(c);
* * * * *
0
37. Section 124.3 is amended by revising paragraph (b)(2) to read as
follows:
Sec. 124.3 Exports of technical data in furtherance of an agreement.
* * * * *
(b) * * *
(2) The U.S. party complies with the requirements of the Department
of Defense National Industrial Security Program Operating Manual
concerning the transmission of classified information (unless such
requirements are in direct conflict with guidance provided by the
Directorate of Defense Trade Controls, in which case the latter
guidance must be followed) and any other requirements of cognizant U.S.
departments or agencies.
0
38. Section 124.4 is amended by revising the heading, paragraphs (a)
and (b) introductory text to read as follows:
Sec. 124.4 Deposit of signed agreements with the Directorate of
Defense Trade Controls.
(a) The United States party to a manufacturing license or a
technical assistance agreement must file one copy of the concluded
agreement with the Directorate of Defense Trade Controls not later than
30 days after it enters into force. If the agreement is not concluded
within one year of the date of approval, the Directorate of Defense
Trade Controls must be notified in writing and be kept informed of the
status of the agreement until the requirements of this paragraph or the
requirements of Sec. 124.5 are satisfied.
(b) In the case of concluded agreements involving coproduction or
licensed production outside of the United States of defense articles of
United States origin, a written statement must accompany filing of the
concluded agreement with the Directorate of Defense Trade Controls,
which shall include:
* * * * *
0
39. Section 124.5 is revised to read as follows:
Sec. 124.5 Proposed agreements that are not concluded.
The United States party to any proposed manufacturing license
agreement or technical assistance agreement must inform the Directorate
of Defense Trade Controls if a decision is made not to conclude the
agreement. The information must be provided within 60 days of the date
of the decision. These requirements apply only if the approval of the
Directorate of Defense Trade Controls was obtained for the agreement to
be concluded (with or without any provisos).
0
40. Section 124.6 is revised to read as follows:
Sec. 124.6 Termination of manufacturing license agreements and
technical assistance agreements.
The U.S. party to a manufacturing license or a technical assistance
agreement must inform the Directorate of Defense Trade Controls in
writing of the impending termination of the agreement not less than 30
days prior to the expiration date of such agreement.
0
41. Section 124.10 is amended by revising paragraphs (a), (b)(1) and
Note to read as follows:
Sec. 124.10 Nontransfer and use assurances.
(a) Types of agreements requiring assurances. With respect to any
manufacturing license agreement or technical assistance agreement which
relates to significant military equipment or classified defense
articles, including classified technical data, a Nontransfer and Use
Certificate (Form DSP-83) (see Sec. 123.10 of this subchapter) signed
by the applicant and the foreign party must be submitted to the
Directorate of Defense Trade Controls. With respect to all agreements
involving classified articles, including classified technical data, an
authorized representative of the foreign government must sign the DSP-
83 (or provide the same assurances in the form of a diplomatic note),
unless the Directorate of Defense Trade Controls has granted an
exception to this requirement. The Directorate of Defense Trade
Controls may require that a DSP-83 be provided in conjunction with an
agreement that does not relate to significant military equipment or
classified defense articles. The Directorate of Defense Trade Controls
may also require with respect to any agreement that an appropriate
authority of the foreign party's government also sign the DSP-83 (or
provide the same assurances in the form of a diplomatic note).
(b) * * *
(1) Agreements which have been signed by all parties before being
submitted to the Directorate of Defense Trade Controls may only be
submitted along with any required DSP-83 and/or diplomatic note.
(2) * * *
Note to paragraph (b): In no case may a transfer occur before a
required DSP-83 and/or diplomatic note has been submitted to the
Directorate of Defense Trade Controls.
0
42. Section 124.12 is amended by revising paragraphs (a) introductory
text and (a)(1) to read as follows:
Sec. 124.12 Required information in letters of transmittal.
(a) An application for the approval of a manufacturing license or
technical assistance agreement with a foreign person must be
accompanied by an explanatory letter. The original letter and seven
copies of the letter and eight copies of the proposed agreement shall
be submitted to the Directorate of Defense Trade Controls. The
explanatory letter shall contain:
(1) A statement giving the applicant's Directorate of Defense Trade
Controls registration number.
* * * * *
0
43. Section 124.13 is amended by revising introductory text and
paragraphs (d) introductory text and (e) to read as follows:
Sec. 124.13 Procurement by United States persons in foreign countries
(off-shore procurement).
Notwithstanding the other provisions in part 124 of this
subchapter, the Directorate of Defense Trade Controls may authorize by
means of a license (DSP-5) the export of unclassified technical data to
foreign persons for offshore procurement of defense articles, provided
that:
* * * * *
(d) The person in the United States provides the Directorate of
Defense
[[Page 20544]]
Trade Controls with a copy of each contract, purchase order or
subcontract for offshore procurement at the time it is accepted. Each
such contract, purchase order or subcontract must clearly identify the
article to be produced and must identify the license number or
exemption under which the technical data was exported; and
(e) Licenses issued pursuant to this section must be renewed prior
to their expiration if offshore procurement is to be extended beyond
the period of validity of the original approved license. In all
instances a license for offshore procurement must state as the purpose
``Offshore procurement in accordance with the conditions established in
the ITAR, including Sec. 124.13. No other use will be made of the
technical data.'' If the technical data involved in an offshore
procurement arrangement is otherwise exempt from the licensing
requirements of this subchapter (e.g., Sec. 126.4), the DSP-5 referred
to in the first sentence of this section is not required. However, the
exporter must comply with the other requirements of this section and
provide a written certification to the Directorate of Defense Trade
Controls annually of the offshore procurement activity and cite the
exemption under which the technical data was exported. The exemptions
under Sec. 125.4 of this subchapter may not be used to establish
offshore procurement arrangements.
0
44. Section 124.14 is amended by revising paragraphs (a), (b)
introductory text, (b)(4), (c)(5), (e) introductory text and (e)(1) to
read as follows:
Sec. 124.14 Exports to warehouses or distribution points outside the
United States.
(a) Agreements. Agreements (e.g., contracts) between U.S. persons
and foreign persons for the warehousing and distribution of defense
articles must be approved by the Directorate of Defense Trade Controls
before they enter into force. Such agreements will be limited to
unclassified defense articles and must contain conditions for special
distribution, end-use and reporting. Licenses for exports pursuant to
such agreements must be obtained prior to exports of the defense
articles unless an exemption under Sec. 123.16(b)(1) of this
subchapter is applicable.
(b) Required information. Proposed warehousing and distribution
agreements (and amendments thereto) shall be submitted to the
Directorate of Defense Trade Controls for approval. The following
information must be included in all such agreements:
* * * * *
(4) Specific identification of the country or countries that
comprise the distribution territory. Distribution must be specifically
limited to the governments of such countries or to private entities
seeking to procure defense articles pursuant to a contract with a
government within the distribution territory or to other eligible
entities as specified by the Directorate of Defense Trade Controls.
Consequently, any deviation from this condition must be fully explained
and justified. A nontransfer and use certificate (DSP-83) will be
required to the same extent required in licensing agreements under
Sec. 124.9(b).
* * * * *
(c) * * *
(5) ``No export, sale, transfer, or other disposition of the
defense articles covered by this agreement is authorized to any country
outside the distribution territory without the prior written approval
of the Directorate of Defense Trade Controls of the U.S. Department of
State.''
* * * * *
(e) Transmittal letters. Requests for approval of warehousing and
distribution agreements with foreign persons must be made by letter.
The original letter and seven copies of the letter and seven copies of
the proposed agreement shall be submitted to the Directorate of Defense
Trade Controls. The letter shall contain:
(1) A statement giving the applicant's Directorate of Defense Trade
Controls registration number.
* * * * *
PART 125--LICENSES FOR THE EXPORT OF TECHNICAL DATA AND CLASSIFIED
DEFENSE ARTICLES
0
45. The authority citation for part 125 is revised to read as follows:
Authority: Secs. 2 and 38, Pub. L. 90-629, 90 Stat. 744 (22
U.S.C. 2752, 2778); E.O. 11958, 42 FR 4311; 3 CFR, 1977 Comp. p. 79;
22 U.S.C. 2651a.
0
46. Section 125.1 is amended by revising paragraphs (b), (c), and (d)
to read as follows:
Sec. 125.1 Exports subject to this part.
* * * * *
(b) A license for the export of technical data and the exemptions
in Sec. 125.4 may not be used for foreign production purposes or for
technical assistance unless the approval of the Directorate of Defense
Trade Controls has been obtained. Such approval is generally provided
only pursuant to the procedures specified in part 124 of this
subchapter.
(c) Technical data authorized for export may not be reexported,
transferred or diverted from the country of ultimate end-use or from
the authorized foreign end-user (as designated in the license or
approval for export) or disclosed to a national of another country
without the prior written approval of the Directorate of Defense Trade
Controls.
(d) The controls of this part apply to the exports referred to in
paragraph (a) of this section regardless of whether the person who
intends to export the technical data produces or manufactures defense
articles if the technical data is determined by the Directorate of
Defense Trade Controls to be subject to the controls of this
subchapter.
* * * * *
0
47. Section 125.2 is amended by revising paragraphs (a) and (b) to read
as follows:
Sec. 125.2 Exports of unclassified technical data.
(a) License. A license (DSP-5) is required for the export of
unclassified technical data unless the export is exempt from the
licensing requirements of this subchapter. In the case of a plant
visit, details of the proposed discussions must be transmitted to the
Directorate of Defense Trade Controls for an appraisal of the technical
data. Seven copies of the technical data or the details of the
discussion must be provided.
(b) Patents. A license issued by the Directorate of Defense Trade
Controls is required for the export of technical data whenever the data
exceeds that which is used to support a domestic filing of a patent
application or to support a foreign filing of a patent application
whenever no domestic application has been filed. Requests for the
filing of patent applications in a foreign country, and requests for
the filing of amendments, modifications or supplements to such patents,
should follow the regulations of the U.S. Patent and Trademark Office
in accordance with 37 CFR part 5. The export of technical data to
support the filing and processing of patent applications in foreign
countries is subject to regulations issued by the U.S. Patent and
Trademark Office pursuant to 35 U.S.C. 184.
* * * * *
0
48. Section 125.3 is amended by revising paragraphs (a), (b), and (c)
to read as follows:
Sec. 125.3 Exports of classified technical data and classified
defense articles.
(a) A request for authority to export defense articles, including
technical
[[Page 20545]]
data, classified by a foreign government or pursuant to Executive Order
12356, successor orders, or other legal authority must be submitted to
the Directorate of Defense Trade Controls for approval. The application
must contain full details of the proposed transaction. It should also
list the facility security clearance code of all U.S. parties on the
license and include the Defense Security Service cognizant security
office of the party responsible for packaging the commodity for
shipment. A nontransfer and use certificate (Form DSP-83) executed by
the applicant, foreign consignee, end-user and an authorized
representative of the foreign government involved will be required.
(b) Classified technical data which is approved by the Directorate
of Defense Trade Controls either for export or reexport after a
temporary import will be transferred or disclosed only in accordance
with the requirements in the Department of Defense National Industrial
Security Program Operating Manual (unless such requirements are in
direct conflict with guidance provided by the Directorate of Defense
Trade Controls, in which case the latter guidance must be followed).
Any other requirements imposed by cognizant U.S. departments and
agencies must also be satisfied.
(c) The approval of the Directorate of Defense Trade Controls must
be obtained for the export of technical data by a U.S. person to a
foreign person in the U.S. or in a foreign country unless the proposed
export is exempt under the provisions of this subchapter.
* * * * *
0
49. Section 125.4 is amended by revising paragraphs (a), (b)(9)(iii),
(b)(10)(iii), (b)(11), and (b)(13) to read as follows:
Sec. 125.4 Exemptions of general applicability.
(a) The following exemptions apply to exports of technical data for
which approval is not needed from the Directorate of Defense Trade
Controls. These exemptions, except for paragraph (b)(13) of this
section, do not apply to exports to proscribed destinations under Sec.
126.1 of this subchapter or for persons considered generally ineligible
under Sec. 120.1(c) of this subchapter. The exemptions are also not
applicable for purposes of establishing offshore procurement
arrangements or producing defense articles offshore (see Sec. 124.13),
except as authorized under Sec. 125.4 (c). If Sec. 126.8 of this
subchapter requirements are applicable, they must be met before an
exemption under this section may be used. Transmission of classified
information must comply with the requirements of the Department of
Defense National Industrial Security Program Operating Manual (unless
such requirements are in direct conflict with guidance provided by the
Directorate of Defense Trade Controls, in which case the latter
guidance must be followed) and the exporter must certify to the
transmittal authority that the technical data does not exceed the
technical limitation of the authorized export.
(b) * * *
(9) * * *
(iii) The classified information is sent overseas in accordance
with the requirements of the Department of Defense National Industrial
Security Program Operating Manual (unless such requirements are in
direct conflict with guidance provided by the Directorate of Defense
Trade Controls, in which case the latter guidance must be followed).
(10) * * *
(iii) The institution informs the individual in writing that the
technical data may not be transferred to other foreign persons without
the prior written approval of the Directorate of Defense Trade
Controls;
(11) Technical data, including classified information, for which
the exporter, pursuant to an arrangement with the Department of
Defense, Department of Energy or NASA which requires such exports, has
been granted an exemption in writing from the licensing provisions of
this part by the Directorate of Defense Trade Controls. Such an
exemption will normally be granted only if the arrangement directly
implements an international agreement to which the United States is a
party and if multiple exports are contemplated. The Directorate of
Defense Trade Controls, in consultation with the relevant U.S.
Government agencies, will determine whether the interests of the United
States Government are best served by expediting exports under an
arrangement through an exemption (see also paragraph (b)(3) of this
section for a related exemption);
* * * * *
(13) Technical data approved for public release (i.e., unlimited
distribution) by the cognizant U.S. Government department or agency or
Office of Freedom of Information and Security Review. This exemption is
applicable to information approved by the cognizant U.S. Government
department or agency for public release in any form. It does not
require that the information be published in order to qualify for the
exemption.
* * * * *
0
50. Section 125.5 is revised to read as follows:
Sec. 125.5 Exemptions for plant visits.
(a) A license is not required for the oral and visual disclosure of
unclassified technical data during the course of a classified plant
visit by a foreign person, provided: The classified visit has itself
been authorized pursuant to a license issued by the Directorate of
Defense Trade Controls; or the classified visit was approved in
connection with an actual or potential government-to-government program
or project by a U.S. Government agency having classification
jurisdiction over the classified defense article or classified
technical data involved under Executive Order 12356 or other applicable
Executive Order; and the unclassified information to be released is
directly related to the classified defense article or technical data
for which approval was obtained and does not disclose the details of
the design, development, production or manufacture of any other defense
articles. In the case of visits involving classified information, the
requirements of the Department of Defense National Industrial Security
Program Operating Manual must be met (unless such requirements are in
direct conflict with guidance provided by the Directorate of Defense
Trade Controls, in which case the latter guidance must be followed).
(b) The approval of the Directorate of Defense Trade Controls is
not required for the disclosure of oral and visual classified
information to a foreign person during the course of a plant visit
approved by the appropriate U.S. Government agency if: The requirements
of the Department of Defense National Industrial Security Program
Operating Manual have been met (unless such requirements are in direct
conflict with guidance provided by the Directorate of Defense Trade
Controls, in which case the latter guidance must be followed); the
classified information is directly related to that which was approved
by the U.S. Government agency; it does not exceed that for which
approval was obtained; and it does not disclose the details of the
design, development, production or manufacture of any defense articles.
(c) A license is not required for the disclosure to a foreign
person of unclassified technical data during the course of a plant
visit (either classified or unclassified) approved by the Directorate
of Defense Trade Controls or a cognizant U.S. Government agency
provided the technical data does not contain information in excess of
that approved for disclosure. This exemption
[[Page 20546]]
does not apply to technical data which could be used for design,
development, production or manufacture of a defense article.
0
51. Section 125.7 is revised to read as follows:
Sec. 125.7 Procedures for the export of classified technical data and
other classified defense articles.
(a) All applications for the export or temporary import of
classified technical data or other classified defense articles must be
submitted to the Directorate of Defense Trade Controls on Form DSP-85.
(b) An application for the export of classified technical data or
other classified defense articles must be accompanied by seven copies
of the data and a completed Form DSP-83 (see Sec. 123.10 of this
subchapter). Only one copy of the data or descriptive literature must
be provided if a renewal of the license is requested. All classified
materials accompanying an application must be transmitted to the
Directorate of Defense Trade Controls in accordance with the procedures
contained in the Department of Defense National Industrial Security
Program Operating Manual (unless such requirements are in direct
conflict with guidance provided by the Directorate of Defense Trade
Controls, in which case the latter guidance must be followed).
0
52. Section 125.9 is revised to read as follows:
Sec. 125.9 Filing of licenses and other authorizations for exports of
classified technical data and classified defense articles.
Licenses and other authorizations for the export of classified
technical data or classified defense articles will be forwarded by the
Directorate of Defense Trade Controls to the Defense Security Service
of the Department of Defense in accordance with the provisions of the
Department of Defense National Industrial Security Program Operating
Manual (unless such requirements are in direct conflict with guidance
provided by the Directorate of Defense Trade Controls, in which case
the latter guidance must be followed). The Directorate of Defense Trade
Controls will forward a copy of the license to the applicant for the
applicant's information. The Defense Security Service will return the
endorsed license to the Directorate of Defense Trade Controls upon
completion of the authorized export or expiration of the license,
whichever occurs first.
PART 126--GENERAL POLICIES AND PROVISIONS
0
53. The authority citation for part 126 continues to read as follows:
Authority: Secs. 2, 38, 40, 42, and 71, Pub. L. 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, Pub.
L. 108-375.
0
54. Section 126.1 is amended by revising paragraph (e) to read as
follows:
Sec. 126.1 Prohibited exports and sales to certain countries.
* * * * *
(e) Proposed sales. No sale or transfer and no proposal to sell or
transfer any defense articles, defense services or technical data
subject to this subchapter may be made to any country referred to in
this section (including the embassies or consulates of such a country),
or to any person acting on its behalf, whether in the United States or
abroad, without first obtaining a license or written approval of the
Directorate of Defense Trade Controls. However, in accordance with
paragraph (a) of this section, it is the policy of the Department of
State to deny licenses and approvals in such cases. Any person who
knows or has reason to know of such a proposed or actual sale, or
transfer, of such articles, services or data must immediately inform
the Directorate of Defense Trade Controls.
* * * * *
0
55. Section 126.2 is revised to read as follows:
Sec. 126.2 Temporary suspension or modification of this subchapter.
The Deputy Assistant Secretary for Defense Trade Controls or the
Managing Director, Directorate of Defense Trade Controls, may order the
temporary suspension or modification of any or all of the regulations
of this subchapter in the interest of the security and foreign policy
of the United States.
0
56. Section 126.5 is amended by revising paragraph (c)(4)(v) to read as
follows:
Sec. 126.5 Canadian exemptions.
* * * * *
(c) * * *
(4) * * *
(v) Include a clause requiring that all documentation created from
U.S. technical data contain the statement, ``This document contains
technical data, the use of which is restricted by the U.S. Arms Export
Control Act. This data has been provided in accordance with, and is
subject to, the limitations specified in Sec. 126.5 of the
International Traffic In Arms Regulations (ITAR). By accepting this
data, the consignee agrees to honor the requirements of the ITAR''; and
* * * * *
0
57. Section 126.6 is amended by revising paragraph (b) to read as
follows:
Sec. 126.6 Foreign-owned military aircraft and naval vessels, and the
Foreign Military Sales Program.
* * * * *
(b) Foreign military aircraft and naval vessels. A license is not
required for the entry into the United States of military aircraft or
naval vessels of any foreign state if no overhaul, repair, or
modification of the aircraft or naval vessel is to be performed.
However, Department of State approval for overflight (pursuant to the
49 U.S.C. 40103) and naval visits must be obtained from the Bureau of
Political-Military Affairs, Office of International Security
Operations.
* * * * *
0
58. Section 126.7 is amended by revising paragraphs (a) introductory
text, (a)(6), (b), and (c) to read as follows:
Sec. 126.7 Denial, revocation, suspension or amendment of licenses
and other approvals.
(a) Policy. Licenses or approvals shall be denied or revoked
whenever required by any statute of the United States (see Sec. Sec.
127.7 and 127.11 of this subchapter). Any application for an export
license or other approval under this subchapter may be disapproved, and
any license or other approval or exemption granted under this
subchapter may be revoked, suspended, or amended without prior notice
whenever:
* * * * *
(6) An applicant, any party to the export or agreement, any source
or manufacturer of the defense article or defense service or any person
who has a significant interest in the transaction has been debarred,
suspended, or otherwise is ineligible to receive an export license or
other authorization from any agency of the U.S. government (e.g.,
pursuant to debarment by the Department of Commerce under 15 CFR part
760 or by the Department of State under part 127 or 128 of this
subchapter); or
* * * * *
(b) Notification. The Directorate of Defense Trade Controls will
notify applicants or licensees or other appropriate United States
persons of actions taken pursuant to paragraph (a) of this section. The
reasons for the
[[Page 20547]]
action will be stated as specifically as security and foreign policy
considerations permit.
(c) Reconsideration. If a written request for reconsideration of an
adverse decision is made within 30 days after a person has been
informed of the decision, the U.S. person will be accorded an
opportunity to present additional information. The case will then be
reviewed by the Directorate of Defense Trade Controls.
* * * * *
0
59. Section 126.8 is amended by revising paragraphs (a), (a)(1)
introductory text, (a)(2), (a)(3) introductory text, (c)(1)(i), (c)(2)
and (d) to read as follows:
Sec. 126.8 Proposals to foreign persons relating to significant
military equipment.
(a) Proposals. Certain proposals to foreign persons for the sale or
manufacture abroad of significant military equipment require either the
prior approval of, or prior notification to, the Directorate of Defense
Trade Controls.
(1) Sale of significant military equipment: The prior approval of
the Directorate of Defense Trade Controls is required before a U.S.
person may make a proposal or presentation designed to constitute a
basis for a decision on the part of any foreign person to purchase
significant military equipment on the U.S. Munitions List whenever all
the following conditions are met:
* * * * *
(2) Sale of significant military equipment: The Directorate of
Defense Trade Controls must be notified in writing at least thirty days
in advance of any proposal or presentation concerning the sale of
significant military equipment whenever the conditions specified in
paragraphs (a)(1)(i) through (iii) of this section are met and the
identical equipment has been previously licensed for permanent export
or approved for sale under the FMS Program to any foreign country.
(3) Manufacture abroad of significant military equipment: The prior
approval of the Directorate of Defense Trade Controls is required
before a U.S. person may make a proposal or presentation designed to
constitute a basis for a decision on the part of any foreign person to
enter into any manufacturing license agreement or technical assistance
agreement for the production or assembly of significant military
equipment, regardless of dollar value, in any foreign country,
whenever:
* * * * *
(c) * * *
(1) * * *
(i) A written statement from the Directorate of Defense Trade
Controls approving the proposed sale or agreement or approving the
making of a proposal or presentation.
* * * * *
(2) The requirement of this section for prior notification is met
by informing the Directorate of Defense Trade Controls by letter at
least 30 days before making the proposal or presentation. The letter
must comply with the procedures set forth in paragraph (d) of this
section and must identify the relevant license, approval, or FMS case
by which the identical equipment had previously been authorized for
permanent export or sale. The Directorate of Defense Trade Controls
will provide written acknowledgement of such prior notification to
confirm compliance with this requirement and the commencement of the
30-day notification period.
(d) Procedures. Unless a license has been obtained pursuant to
Sec. 126.8(c)(1)(ii) or (iii), a request for prior approval to make a
proposal or presentation with respect to significant military
equipment, or a 30-day prior notification regarding the sale of such
equipment, must be made by letter to the Directorate of Defense Trade
Controls. The letter must outline in detail the intended transaction,
including usage of the equipment involved and the country (or
countries) involved. Seven copies of the letter should be provided as
well as seven copies of suitable descriptive information concerning the
equipment.
* * * * *
0
60. Section 126.9 is revised to read as follows:
Sec. 126.9 Advisory opinions and related authorizations.
(a) Advisory opinion. Any person desiring information as to whether
the Directorate of Defense Trade Controls would be likely to grant a
license or other approval for the export or approval of a particular
defense article or defense service to a particular country may request
an advisory opinion from the Directorate of Defense Trade Controls.
Advisory opinions are issued on a case-by-case basis and apply only to
the particular matters presented to the Directorate of Defense Trade
Controls. These opinions are not binding on the Department of State,
and may not be used in future matters before the Department. A request
for an advisory opinion must be made in writing and must outline in
detail the equipment, its usage, the security classification (if any)
of the articles or related technical data, and the country or countries
involved. An original and seven copies of the letter must be provided
along with seven copies of suitable descriptive information concerning
the defense article or defense service.
(b) Related authorizations. The Directorate of Defense Trade
Controls may, as appropriate, in accordance with the procedures set
forth in paragraph (a) of this section, provide export authorization,
subject to all other relevant requirements of this subchapter, both for
transactions that have been the subject of advisory opinions requested
by prospective U.S. exporters, or for the Directorate's own
initiatives. Such initiatives may cover pilot programs, or specifically
anticipated circumstances for which the Directorate considers special
authorizations appropriate.
0
61. Section 126.10 is amended by revising paragraphs (a) and (d)(2) to
read as follows:
Sec. 126.10 Disclosure of information.
(a) Freedom of information. Subchapter R of this title contains
regulations on the availability to the public of information and
records of the Department of State. The provisions of subchapter R
apply to such disclosures by the Directorate of Defense Trade Controls.
* * * * *
(d) * * *
(2) Furnishing information to foreign governments and other
agencies of the U.S. Government in the context of multilateral or
bilateral export regimes (e.g., the Missile Technology Control Regime,
the Australia Group, and Wassenaar Arrangement).
0
62. Section 126.11 is revised to read as follows:
Sec. 126.11 Relations to other provisions of law.
The provisions in this subchapter are in addition to, and are not
in lieu of, any other provisions of law or regulations. The sale of
firearms in the United States, for example, remains subject to the
provisions of the Gun Control Act of 1968 and regulations administered
by the Department of Justice. The performance of defense services on
behalf of foreign governments by retired military personnel continues
to require consent pursuant to Part 3a of this title. Persons who
intend to export defense articles or furnish defense services should
not assume that satisfying the requirements of this subchapter relieves
one of other requirements of law.
0
63. Section 126.13 is amended by revising paragraph (c) to read as
follows:
[[Page 20548]]
Sec. 126.13 Required information.
* * * * *
(c) In cases when foreign nationals are employed at or assigned to
security-cleared facilities, provision by the applicant of a Technology
Control Plan (available from the Defense Security Service) will
facilitate processing.
0
64. Section 126.14 is amended by revising paragraphs (a), (a)(1),
(a)(2), (a)(3)(i), (a)(3)(iv), (a)(4), and (b) to read as follows:
Sec. 126.14 Special comprehensive export authorizations for NATO,
Australia, Japan, and Sweden.
(a) Comprehensive authorizations. With respect to NATO members,
Australia, Japan, and Sweden, the Directorate of Defense Trade Controls
may provide the comprehensive authorizations described in paragraphs
(a) and (b) of this section for circumstances where the full parameters
of a commercial export endeavor including the needed defense exports
can be well anticipated and described in advance, thereby making use of
such comprehensive authorizations appropriate.
(1) Major project authorization. With respect to NATO members,
Australia, Japan, and Sweden, the Directorate of Defense Trade Controls
may provide comprehensive authorizations for well circumscribed
commercially developed ``major projects'', where a principal registered
U.S. exporter/prime contractor identifies in advance the broad
parameters of a commercial project including defense exports needed,
other participants (e.g., exporters with whom they have ``teamed up,''
or subcontractors), and foreign government end users. Projects eligible
for such authorization may include a commercial export of a major
weapons system for a foreign government involving, for example,
multiple U.S. suppliers under a commercial teaming agreement to design,
develop and manufacture defense articles to meet a foreign government's
requirements. U.S. exporters seeking such authorization must provide
detailed information concerning the scope of the project, including
other exporters, U.S. subcontractors, and planned exports (including
re-exports) of defense articles, defense services, and technical data,
and meet the other requirements set forth in paragraph (b) of this
section.
(2) Major program authorization. With respect to NATO members,
Australia, Japan, and Sweden, the Directorate of Defense Trade Controls
may provide comprehensive authorizations for well circumscribed
commercially developed ``major program''. This variant would be
available where a single registered U.S. exporter defines in advance
the parameters of a broad commercial program for which the registrant
will be providing all phases of the necessary support (including the
needed hardware, technical data, defense services, development,
manufacturing, and logistic support). U.S. exporters seeking such
authorization must provide detailed information concerning the scope of
the program, including planned exports (including re-exports) of
defense articles, defense services, and technical data, and meet the
other requirements set forth in paragraph (b) of this section.
(3)(i) Global project authorization. With respect to NATO members,
Australia, Japan, and Sweden, the Directorate of Defense Trade Controls
may provide a comprehensive ``Global Project Authorization'' to
registered U.S. exporters for exports of defense articles, technical
data or defense services in support of government to government
cooperative projects (covering research and development or production)
with one of these countries undertaken pursuant to an agreement between
the U.S. Government and the government of such country, or a memorandum
of understanding/agreement between the Department of Defense and the
country's Ministry of Defense.
* * * * *
(iv) Any requirement for non-transfer and use assurances from a
foreign government may be deemed satisfied by the signature by such
government of a cooperative agreement or by its ministry of defense of
a cooperative MOU/MOA where the agreement or MOU contains assurances
that are comparable to that required by a DSP-83 with respect to
foreign governments and that clarifies that the government is
undertaking responsibility for all its participating companies. The
authorized non-government participants or end users (e.g., the
participating government's contractors) will still be required to
execute DSP-83s.
(4) Technical data supporting an acquisition, teaming arrangement,
merger, joint venture authorization. With respect to NATO member
countries, Australia, Japan, and Sweden, the Directorate of Defense
Trade Controls may provide a registered U.S. defense company a
comprehensive authorization to export technical data in support of the
U.S. exporter's consideration of entering into a teaming arrangement,
joint venture, merger, acquisition, or similar arrangement with
prospective foreign partners. Specifically, the authorization is
designed to permit the export of a broadly defined set of technical
data to qualifying well established foreign defense firms in NATO
countries, Australia, Japan, or Sweden in order to better facilitate a
sufficiently in depth assessment of the benefits, opportunities and
other relevant considerations presented by such prospective
arrangements. U.S. exporters seeking such authorization must provide
detailed information concerning the arrangement, joint venture, merger
or acquisition, including any planned exports of defense articles,
defense services, and technical data, and meet the other requirements
set forth in paragraph (b) of this section.
(b) Provisions and requirements for comprehensive authorizations.
Requests for the special comprehensive authorizations set forth in
paragraph (a) of this section should be by letter addressed to the
Directorate of Defense Trade Controls. With regard to a commercial
major program or project authorization, or technical data supporting a
teaming arrangement, merger, joint venture or acquisition, registered
U.S. exporters may consult the Managing Director of the Directorate of
Defense Trade Controls about eligibility for and obtaining available
comprehensive authorizations set forth in paragraph (a) of this section
or pursuant to Sec. 126.9(b).
* * * * *
PART 127--VIOLATIONS AND PENALTIES
0
65. The authority citation for part 127 continues to read as follows:
Authority: Secs. 2, 38, and 42, Pub. L. 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
66. Section 127.1 is amended by revising paragraphs (a)(1), (a)(2),
(a)(3), (c) introductory text, and (d) and by adding paragraphs (a)(5)
and (a)(6) to read as follows:
Sec. 127.1 Violations.
(a) * * *
(1) To export or attempt to export from the United States, or to
reexport or retransfer or attempt to reexport or retransfer from one
foreign destination to another foreign destination by a U.S. person of
any defense article or technical data or by anyone of any U.S. origin
defense article or technical data or to furnish any defense service for
which a license or written approval is required by this subchapter
without first obtaining the required license or written
[[Page 20549]]
approval from the Directorate of Defense Trade Controls;
(2) To import or attempt to import any defense article whenever a
license is required by this subchapter without first obtaining the
required license or written approval from the Directorate of Defense
Trade Controls;
(3) To conspire to export, import, reexport or cause to be
exported, imported or reexported, any defense article or to furnish any
defense service for which a license or written approval is required by
this subchapter without first obtaining the required license or written
approval from the Directorate of Defense Trade Controls;
* * * * *
(5) To engage in the United States in the business of either
manufacturing or exporting defense article or furnishing defense
services without complying with the registration requirements. For the
purposes of this subchapter, engaging in the business of manufacturing
or exporting defense articles or furnishing defense services requires
only one occasion of manufacturing or exporting a defense article or
furnishing a defense service; or
(6) To engage in the business of brokering activities for which
registration, a license or written approval is required by this
subchapter without first registering or obtaining the required license
or written approval from the Directorate of Defense Trade Controls. For
the purposes of this subchapter, engaging in the business of brokering
activities requires only one occasion of engaging in an activity as
reflected in Sec. 129.2(b).
* * * * *
(c) A person with knowledge that another person is then ineligible
pursuant to Sec. Sec. 120.1(c) or 126.7 of this subchapter or subject
to an order of debarment or interim suspension, may not, directly or
indirectly, in any manner or capacity, without prior disclosure of the
facts to, and written authorization from, the Directorate of Defense
Trade Controls:
* * * * *
(d) No person may knowingly or willfully cause, or aid, abet,
counsel, demand, induce, procure or permit the commission of any act
prohibited by, or the omission of any act prohibited by, or the
omission of any act required by 22 U.S.C. 2778, 22 U.S.C. 2779, or any
regulation, license, approval, or order issued thereunder.
0
67. Section 127.3 is amended by revising paragraph (b) to read as
follows:
Sec. 127.3 Penalties for violations.
* * * * *
(b) In a registration, license application or report required by
Sec. 38 or Sec. 39 of the Arms Export Control Act (22 U.S.C. 2778 and
2779) or by any rule or regulation issued under either section, makes
any untrue statement of a material fact or omits a material fact
required to be stated therein or necessary to make the statements
therein not misleading, shall upon conviction be subject to a fine or
imprisonment, or both, as prescribed by 22 U.S.C. 2778(c).
0
68. Section 127.5 is revised to read as follows:
Sec. 127.5 Authority of the Defense Security Service.
In the case of exports involving classified technical data or
defense articles, the Defense Security Service may take appropriate
action to ensure compliance with the Department of Defense National
Industrial Security Program Operating Manual (unless such requirements
are in direct conflict with guidance provided by the Directorate of
Defense Trade Controls, in which case the latter guidance must be
followed). Upon a request to the Defense Security Service regarding the
export of any classified defense article or technical data, the Defense
Security Service official or a designated government transmittal
authority may require the production of other relevant documents and
information relating to the proposed export.
0
69. Section 127.7 is amended by revising paragraphs (a), (b)(2), and
(d) to read as follows:
Sec. 127.7 Debarment.
(a) Debarment. In implementing Sec. 38 of the Arms Export Control
Act, the Assistant Secretary of State for Political-Military Affairs
may prohibit any person from participating directly or indirectly in
the export of defense articles, including technical data, or in the
furnishing of defense services for which a license or approval is
required by this subchapter for any of the reasons listed below. Any
such prohibition is referred to as a debarment for purposes of this
subchapter. The Assistant Secretary of State for Political-Military
Affairs shall determine the appropriate period of time for debarment,
which shall generally be for a period of three years. However,
reinstatement is not automatic and in all cases the debarred person
must submit a request for reinstatement and be approved for
reinstatement before engaging in any export or brokering activities
subject to the Arms Export Control Act or this subchapter.
(b) * * *
(2) The basis for administrative debarment, described in part 128
of this subchapter, is any violation of 22 U.S.C. 2778 or any rule or
regulation issued thereunder when such a violation is of such a
character as to provide a reasonable basis for the Directorate of
Defense Trade Controls to believe that the violator cannot be relied
upon to comply with the statute or these rules or regulations in the
future, and when such violation is established in accordance with part
128 of this subchapter.
* * * * *
(d) Appeals. Any person who is ineligible pursuant to paragraph (c)
of this section may appeal to the Under Secretary of State for Arms
Control and International Security for reconsideration of the
ineligibility determination. The procedures specified in Sec. 128.13
of this subchapter will be used in submitting a reconsideration appeal.
0
70. Section 127.8 is revised to read as follows:
Sec. 127.8 Interim suspension.
(a) The Managing Director of the Directorate of Defense Trade
Controls or the Director of the Office of Defense Trade Controls
Compliance is authorized to order the interim suspension of any person
when the Managing Director or Director of Compliance believes that
grounds for debarment (as defined in Sec. 127.7 of this part) exist
and where and to the extent the Managing Director or Director of
Compliance, as applicable, finds that interim suspension is reasonably
necessary to protect world peace or the security or foreign policy of
the United States. The interim suspension orders prohibit that person
from participating directly or indirectly in the export of any defense
article or defense service for which a license or approval is required
by this subchapter. The suspended person shall be notified in writing
as provided in Sec. 127.7(c) of this part (statutory debarment) or
Sec. 128.3 of this subchapter (administrative debarment), whichever is
appropriate. In both cases, a copy of the interim suspension order will
be served upon that person in the same manner as provided in Sec.
128.3 of this subchapter. The interim suspension order may be made
immediately effective, without prior notice. The order will state the
relevant facts, the grounds for issuance of the order, and describe the
nature and duration of the interim suspension. No person may be
suspended for a period exceeding 60 days, absent extraordinary
circumstances, (e.g., unless proceedings
[[Page 20550]]
under Sec. 127.7(c) of this part or under part 128 of this subchapter,
or criminal proceedings, are initiated).
(b) A motion or petition to vacate or modify an interim suspension
order may be filed at any time with the Under Secretary of State for
Arms Control and International Security. After a final decision is
reached, the Managing Director of the Directorate of Defense Trade
Controls will issue an appropriate order disposing of the motion or
petition and will promptly inform the respondent accordingly.
0
71. Section 127.9 is revised to read as follows:
Sec. 127.9 Applicability of orders.
For the purpose of preventing evasion, orders of the Assistant
Secretary of State for Political-Military Affairs debarring a person
under Sec. 127.7, and orders of the Managing Director, Directorate of
Defense Trade Controls or Director of the Office of Defense Trade
Controls Compliance suspending a person under Sec. 127.8, may be made
applicable to any other person who may then or thereafter (during the
term of the order) be related to the debarred person by affiliation,
ownership, control, position of responsibility, or other commercial
connection. Appropriate notice and opportunity to respond to the basis
for the suspension will be given.
0
72. Section 127.10 is amended by revising paragraphs (a) and (b)
introductory text to read as follows:
Sec. 127.10 Civil penalty.
(a) The Assistant Secretary of State for Political-Military Affairs
is authorized to impose a civil penalty in an amount not to exceed that
authorized by 22 U.S.C. 2778, 2779a and 2780 for each violation of 22
U.S.C. 2778, 2779a and 2780, or any regulation, order, license or
approval issued thereunder. This civil penalty may be either in
addition to, or in lieu of, any other liability or penalty which may be
imposed.
(b) The Directorate of Defense Trade Controls may make:
* * * * *
0
73. Section 127.11 is revised to read as follows:
Sec. 127.11 Past violations.
(a) Presumption of denial. Pursuant to section 38 of the Arms
Export Control Act, licenses or other approvals may not be granted to
persons who have been convicted of violating any of the U.S. criminal
statutes enumerated in Sec. 120.27 of this subchapter or who are
ineligible to receive any export licenses from any agency of the U.S.
Government, subject to a narrowly defined statutory exception. This
provision establishes a presumption of denial for licenses or other
approvals involving such persons. This presumption is applied by the
Directorate of Defense Trade Controls to all persons convicted or
deemed ineligible in this manner since the effective date of the Arms
Export Control Act (Public Law 94-329; 90 Stat. 729) (June 30, 1976).
(b) Policy. An exception to the policy of the Department of State
to deny applications for licenses or other approvals that involve
persons described in paragraph (a) of this section shall not be
considered unless there are extraordinary circumstances surrounding the
conviction or ineligibility to export, and only if the applicant
demonstrates, to the satisfaction of the Assistant Secretary of State
for Political-Military Affairs, that the applicant has taken
appropriate steps to mitigate any law enforcement and other legitimate
concerns, and to deal with the causes that resulted in the conviction,
ineligibility, or debarment. Any person described in paragraph (a) of
this section who wishes to request consideration of any application
must explain, in a letter to the Managing Director, Directorate of
Defense Trade Controls, the reasons why the application should be
considered. If the Assistant Secretary of State for Political-Military
Affairs concludes that the application and written explanation have
sufficient merit, the Assistant Secretary shall consult with the Office
of the Legal Adviser and the Department of the Treasury regarding law
enforcement concerns, and may also request the views of other
departments, including the Department of Justice. If the Directorate of
Defense Trade Controls does grant the license or other approval,
subsequent applications from the same person need not repeat the
information previously provided but should instead refer to the
favorable decision.
(c) Debarred persons. Persons debarred pursuant to Sec. 127.7(c)
(statutory debarment) may not utilize the procedures provided by this
section while the debarment is in force. Such persons may utilize only
the procedures provided by Sec. 127.7(d) of this part.
0
74. Section 127.12 is amended by revising paragraphs (a), (b)(1),
(b)(2), (b)(3) introductory text, (b)(4), (c)(1), and (d)(1)(iii) to
read as follows:
Sec. 127.12 Voluntary disclosures.
(a) General policy. The Department strongly encourages the
disclosure of information to the Directorate of Defense Trade Controls
by persons, firms or any organization that believe they may have
violated any export control provision of the Arms Export Control Act,
or any regulation, order, license, or other authorization issued under
the authority of the Arms Export Control Act. Voluntary self-disclosure
may be considered a mitigating factor in determining the administrative
penalties, if any, that should be imposed by the Department. Failure to
report such violation(s) may result in circumstances detrimental to
U.S. national security and foreign policy interests and will be an
adverse factor in determining the appropriate disposition of such
violations.
(b) Limitations. (1) The provisions of this section apply only when
information is provided to the Directorate of Defense Trade Controls
for its review in determining whether to take administrative action
under part 128 of this subchapter concerning violation(s) of the export
control provisions of the Arms Export Control Act and these
regulations.
(2) The provisions of this section apply only when information is
received by the Directorate of Defense Trade Controls for review prior
to such time that either the Department of State or any other agency,
bureau or department of the United States Government obtains knowledge
of either the same or substantially similar information from another
source and commenced an investigation or inquiry that involves that
information, and that is intended to determine whether the Arms Export
Control Act or these regulations, or any other license, order or other
authorization issued under the Arms Export Control Act has been
violated.
(3) It is possible that the activity in question--despite voluntary
disclosure--might merit penalties, administrative actions, sanctions,
or referrals to the Department of Justice for consideration as to
whether criminal prosecution is warranted. In the latter case, the
Directorate of Defense Trade Controls will notify the Department of
Justice of the voluntary nature of the disclosure, although the
Department of Justice is not required to give that fact any weight. The
Directorate of Defense Trade Controls has the sole discretion to
consider whether ``voluntary disclosure,'' in context with other
relevant information in a particular case, should be a mitigating
factor in determining what, if any, administrative action will be
imposed. Some of the mitigating factors the Directorate of
[[Page 20551]]
Defense Trade Controls may consider are:
* * * * *
(4) The provisions of this section do not, nor should they be
relied on to, create, confer, or grant any rights, benefits,
privileges, or protection enforceable at law or in equity by any
person, business, or entity in any civil, criminal, administrative, or
other matter.
(c) Notification. (1) Any person or firm wanting to disclose
information that constitutes a voluntary self-disclosure should, in the
manner outlined below, initially notify the Directorate of Defense
Trade Controls immediately after violation(s) are discovered and then
conduct a thorough review of all export-related transactions where
violation(s) are suspected.
* * * * *
(d) * * *
(1) * * *
(iii) Any other relevant documents must be retained by the person
making the disclosure until the Directorate of Defense Trade Controls
requests them or until a final decision on the disclosed information
has been made.
* * * * *
PART 128--ADMINISTRATIVE PROCEDURES
0
75. The authority citation for part 128 is revised to read as follows:
Authority: Secs. 2, 38, 40, 42, and 71, Arms Export Control Act.
90 Stat. 744 (22 U.S.C. 2752, 2778, 2780, 2791, and 2797); E.O.
11958, 42 FR 4311; 22 U.S.C. 2651a; E.O. 12291, 46 FR 1981.
0
76. Section 128.2 is revised to read as follows:
Sec. 128.2 Administrative Law Judge.
The Administrative Law Judge referred to in this part is an
Administrative Law Judge appointed by the Department of State. The
Administrative Law Judge is authorized to exercise the powers and
perform the duties provided for in Sec. Sec. 127.7, 127.8, and 128.3
through 128.16 of this subchapter.
0
77. Section 128.3 is amended by revising paragraph (a) to read as
follows:
Sec. 128.3 Institution of Administrative Proceedings.
(a) Charging letters. The Managing Director, Directorate of Defense
Trade Controls, with the concurrence of the Office of the Legal
Adviser, Department of State, may initiate proceedings to impose
debarment or civil penalties in accordance with Sec. 127.7 or Sec.
127.10 of this subchapter, respectively. Administrative proceedings
shall be initiated by means of a charging letter. The charging letter
will state the essential facts constituting the alleged violation and
refer to the regulatory or other provisions involved. It will give
notice to the respondent to answer the charges within 30 days, as
provided in Sec. 128.5(a), and indicate that a failure to answer will
be taken as an admission of the truth of the charges. It will inform
the respondent that he or she is entitled to an oral hearing if a
written demand for one is filed with the answer or within seven (7)
days after service of the answer. The respondent will also be informed
that he or she may, if so desired, be represented by counsel of his or
her choosing. Charging letters may be amended from time to time, upon
reasonable notice.
* * * * *
0
78. Section 128.5 is amended by revising paragraph (c) to read as
follows:
Sec. 128.5 Answer and demand for oral hearing.
* * * * *
(c) Submission of answer. The answer, written demand for oral
hearing (if any) and supporting evidence required by Sec. 128.5(b)
shall be in duplicate and mailed or delivered to the designated
Administrative Law Judge. A copy shall be simultaneously mailed to the
Managing Director, Directorate of Defense Trade Controls, SA-1, Room
1200, Department of State, Washington, DC 20522-0112, or delivered to
2401 Street, NW., Washington, DC addressed to Managing Director,
Directorate of Defense Trade Controls, SA-1, Room 1200, Department of
State, Washington, DC 20037.
0
79. Section 128.6 is amended by revising paragraphs (a), (b), and (d)
to read as follows:
Sec. 128.6 Discovery.
(a) Discovery by the respondent. The respondent, through the
Administrative Law Judge, may request from the Directorate of Defense
Trade Controls any relevant information, not privileged or otherwise
not authorized for release, that may be necessary or helpful in
preparing a defense. The Directorate of Defense Trade Controls may
provide any relevant information, not privileged or otherwise not
authorized for release, that may be necessary or helpful in preparing a
defense. The Directorate of Defense Trade Controls may supply summaries
in place of original documents and may withhold information from
discovery if the interests of national security or foreign policy so
require, or if necessary to comply with any statute, executive order or
regulation requiring that the information not be disclosed. The
respondent may request the Administrative Law Judge to request any
relevant information, books, records, or other evidence, from any other
person or government agency so long as the request is reasonable in
scope and not unduly burdensome.
(b) Discovery by the Directorate of Defense Trade Controls. The
Directorate of Defense Trade Controls or the Administrative Law Judge
may make reasonable requests from the respondent of admissions of
facts, answers to interrogatories, the production of books, records, or
other relevant evidence, so long as the request is relevant and
material.
* * * * *
(d) Enforcement of discovery rights. If the Directorate of Defense
Trade Controls fails to provide the respondent with information in its
possession which is not otherwise available and which is necessary to
the respondent's defense, the Administrative Law Judge may dismiss the
charges on her or his own motion or on a motion of the respondent. If
the respondent fails to respond with reasonable diligence to the
requests for discovery by the Directorate of Defense Trade Controls or
the Administrative Law Judge, on her or his own motion or motion of the
Directorate of Defense Trade Controls, and upon such notice to the
respondent as the Administrative Law Judge may direct, may strike
respondent's answer and declare the respondent in default, or make any
other ruling which the Administrative Law Judge deems necessary and
just under the circumstances. If a third party fails to respond to the
request for information, the Administrative Law Judge shall consider
whether the evidence sought is necessary to a fair hearing, and if it
is so necessary that a fair hearing may not be held without it, the
Administrative Law Judge shall determine whether s