[Federal Register: November 20, 2008 (Volume 73, Number 225)]
[Notices]
[Page 70322-70323]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20no08-43]
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
[Docket No. 0810231385-81390-01]
Request for Public Comments on the Prospect of Removing 7A
Commodities From De Minimis Eligibility
AGENCY: Bureau of Industry and Security, Department of Commerce.
ACTION: Notice of Inquiry.
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SUMMARY: The Bureau of Industry and Security (BIS) is seeking public
comment on the prospect of removing from de minimis eligibility
commodities controlled for missile technology (MT) reasons under
Category 7--Product Group A on the Commerce Control List except when
the 7A commodities are incorporated as standard equipment in Federal
Aviation Administration (FAA) (or national equivalent) certified
civilian transport aircraft. If such a policy were implemented, foreign
made items that incorporate U.S.-origin 7A commodities would be subject
to the Export Administration Regulations, except when the 7A
commodities are incorporated as standard equipment in FAA (or national
equivalent) certified civilian transport aircraft. Specifically, BIS is
seeking public input on the impact such a change would have on U.S.
manufacturers of category 7A commodities, as well as the impact such a
change would have on foreign manufacturers that incorporate U.S.-origin
7A commodities into their foreign-made products.
DATES: Comments must be received no later than January 20, 2009.
ADDRESSES: Written comments may be submitted via http://
www.regulations.gov, by e-mail directly to BIS at
publiccomments@bis.doc.gov or on paper to U.S. Department of Commerce,
Bureau of Industry and Security, Regulatory Policy Division, Room H-
2705, Washington DC 20230. Please input ``7A/De minimis'' in the
subject line.
FOR FURTHER INFORMATION CONTACT: Sharron Cook, Office of Exporter
Services, Regulatory Policy Division, Bureau of Industry and Security
at 202-482-2440, or fax 202-482-3355, or e-mail at scook@bis.doc.gov.
SUPPLEMENTARY INFORMATION:
Background
The term ``de minimis'' generally refers to matters that are of
minor significance. The de minimis provisions of the Export
Administration Regulations (EAR) promote U.S. export
[[Page 70323]]
control objectives as set forth in the Export Administration Act of
1979, as amended, (EAA) while limiting U.S. jurisdiction over non-U.S.
products containing a de minimis percentage, by value, of U.S. content.
To prevent the diversion of controlled U.S. items and foreign-made
items incorporating a significant amount of U.S. content, a foreign-
made item that contains more than the de minimis amount of controlled
U.S.-origin content by value is subject to the EAR, i.e., a license may
be required from BIS for the export abroad to another foreign country
or in-country transfer of the foreign-made item. Prior to March 1987,
the EAR set no de minimis levels for U.S. content in foreign-made
items; foreign-made items were subject to the EAR if they contained any
amount of U.S.-origin content, no matter how small. A rule published
March 23, 1987 (52 FR 9147) revised what were then called the ``parts
and components'' provisions to establish thresholds at which the amount
of U.S.-origin commodities in foreign-made items would warrant exercise
of U.S. jurisdiction over the foreign-made item when located outside
the United States. The rule was established to alleviate a major trade
dispute with allies who strenuously objected to U.S. assertion of
jurisdiction over all reexports of non-U.S. items that contained even
small amounts of U.S. content. A major revision of the EAR in 1996 (61
FR 12714) introduced the term ``de minimis'' and established de minimis
thresholds for software and technology. The most recent revisions to
the de minimis rules occurred on October 1, 2008, when BIS published a
rule to change the de minimis calculation for foreign produced hardware
bundled with U.S.-origin software, clarify the definition of
`incorporate' as it is applied to the de minimis rules, and to make
certain other changes.
Commodities controlled by Category 7--Product Group A in the
Commerce Control List are certain equipment and components related to
navigation and avionics. Reviewing agencies have raised concerns that
such commodities, when controlled for MT reasons, have the potential to
provide a foreign product with unique military capabilities, even if
the value of the commodity is below normal de minimis levels. Airline
and national aviation safety controls help to minimize the risk of
diversion for Category 7--Product Group A commodities installed in
civilian aircraft. It is expected the commodities will remain in the
aircraft and free from tampering with such safety controls. However,
when the commodities are exported in less costly end items with no
national aviation safety authority controls, there may be a higher risk
of diversion.
Requests for Comments
BIS is seeking public comments on the expected impact on U.S.
manufacturers of commodities controlled by Category 7--Product Group A,
as well as the expected impact on foreign manufacturers that
incorporate U.S.-origin 7A commodities into their foreign-made
products, if BIS were to remove from de minimis eligibility commodities
controlled for MT reasons under Category 7--Product Group A, except
when the commodities are incorporated as standard equipment in FAA (or
national equivalent) certified civilian transport aircraft. Specific
estimates related to number of exports, revenue, jobs, etc. that would
be affected would be very useful. Also, the impact such a change would
have on decisions to incorporate U.S.-origin items in future foreign
products would also be useful. Examples of commercial foreign products
that incorporate commodities controlled by Category 7--Product Group A
would be helpful as well. Comments that include rational argument in
support of the position taken in the comment are likely to be more
useful than comments that merely assert a position without such
support.
Finally, BIS is interested in concrete information (URL addresses,
technical specifications, etc.) about the availability of equivalent
commodities from foreign sources.
Dated: November 14, 2008.
Matthew S. Borman,
Deputy Assistant Secretary for Export Administration.
[FR Doc. E8-27588 Filed 11-19-08; 8:45 am]
BILLING CODE 3510-33-P