[Federal Register Volume 76, Number 16 (Tuesday, January 25, 2011)]
[Rules and Regulations]
[Pages 4228-4231]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-1471]
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
15 CFR Parts 738, 740, 742, and 744
[Docket No. 101222617-0617-01]
RIN 0694-AF10
U.S.-India Bilateral Understanding: Revisions to U.S. Export and
Reexport Controls Under the Export Administration Regulations
AGENCY: Bureau of Industry and Security, Commerce.
ACTION: Final rule.
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SUMMARY: In this final rule, the Bureau of Industry and Security (BIS)
amends the Export Administration Regulations (EAR) to implement several
components of the bilateral understanding between the United States and
India announced by President Obama and India's Prime Minister Singh on
November 8, 2010. This is the first in a series of rules implementing
the President's and Prime Minister's commitment to work together to
strengthen the global nonproliferation and export control framework and
further transform our bilateral export control cooperation to realize
the full potential of the strategic partnership between the two
countries. The two leaders outlined mutual steps to implement an export
control reform program. On the part of the United States, these steps
include removing India's defense and space-related entities from the
Entity List (Supplement No. 4 to part 744 of the EAR) and realigning
U.S. export licensing policy toward India by removing India from three
country groups in the EAR and adding it to one country group. This rule
also makes conforming changes to the EAR consistent with these steps.
These reforms reflect India's nonproliferation record and commitment to
abide by multilateral export control standards.
DATES: This rule is effective January 25, 2011. Although there is no
formal comment period, public comments on this regulation are welcome
on a continuing basis.
ADDRESSES: You may submit comments, identified by RIN 0694-AF10, by any
of the following methods:
[[Page 4229]]
E-mail: [email protected] Include ``RIN 0694-AF10'' in the
subject line of the message.
Fax: (202) 482-3355. Please alert the Regulatory Policy Division,
by calling (202) 482-2440, if you are faxing comments.
Mail or Hand Delivery/Courier: Sheila Quarterman, U.S. Department
of Commerce, Bureau of Industry and Security, Regulatory Policy
Division, 14th Street & Pennsylvania Avenue, NW., Room 2705,
Washington, DC 20230, Attn: RIN 0694-AF10.
Send comments regarding the collection of information associated
with this rule, including suggestions for reducing the burden, to
Jasmeet Seehra, Office of Management and Budget (OMB), by e-mail to
[email protected] or by fax to (202) 395-7285. Comments
on this collection of information should be submitted separately from
comments on the final rule (i.e., RIN 0694-AF10)--- all comments on the
latter should be submitted by one of the three methods outlined above.
FOR FURTHER INFORMATION CONTACT: For questions regarding foreign policy
and nonproliferation controls contact Alex Lopes, Director, Office of
Nonproliferation and Treaty Compliance, Export Administration, Bureau
of Industry and Security, Phone: (202) 482-3825, E-mail:
[email protected].
For questions regarding the Entity List contact Karen Nies-Vogel,
Chair, End-User Review Committee, Office of the Assistant Secretary,
Export Administration, Bureau of Industry and Security, U.S. Department
of Commerce, Phone: (202) 482-5991, Fax: (202) 482-3911, E-mail:
[email protected].
SUPPLEMENTARY INFORMATION:
Background
U.S.-India Bilateral Understanding: Revisions to U.S. Export and
Reexport Controls Under the Export Administration Regulations
On November 8, 2010, President Obama and Prime Minister Singh of
India issued a Joint Statement announcing that they had resolved to
expand and strengthen the India-U.S. global strategic partnership.
(U.S.-India Joint Statement, November 8, 2010). The Joint Statement
covers a range of issues, activities, and programs that reflect the
vision of the President and of India's Prime Minister. In the Joint
Statement, the leaders reaffirmed that the U.S.-India strategic
partnership is indispensable for global stability and prosperity and
reaffirmed existing assurances regarding procurement and use by India
of items subject to the Export Administration Regulations (EAR). In the
Joint Statement, recognizing that India and the United States should
play a leadership role in promoting global nonproliferation objectives
and their desire to expand high technology cooperation and trade, the
two leaders committed to work together to strengthen the global export
control framework and further transform bilateral export control
regulations and policies, and decided to take mutual steps to expand
U.S.-India cooperation in civil space, defense and other high-
technology sectors. These steps include removal of Indian defense and
space-related entities from the Entity List, and realignment of India
in U.S. export control regulations. Additionally, the Joint Statement
announced that the United States ``intends to support India's full
membership in the four multilateral export control regimes (Nuclear
Suppliers Group, Missile Technology Control Regime, Australia Group,
and Wassenaar Arrangement) in a phased manner, and to consult with
regime members to encourage the evolution of regime membership
criteria,'' while maintaining these regimes' core principles, ``as the
Government of India takes steps towards the full adoption of the
regimes' export control requirements to reflect its prospective
membership, with both processes moving forward together.''
In this rule, BIS begins implementation of those reforms by
revising certain export and reexport controls for India, including the
removal of nine Indian entities from the Entity List. In addition, BIS
amends the EAR to remove India from Country Groups D:2, D:3, and D:4
and to add India to Country Group A:2. In this rule, BIS also makes
conforming changes in the EAR as part of these initial steps to
implement the export control reform program outlined in the November 8,
2010 U.S.-India bilateral understanding. These changes are in the
national interest of the United States.
Specific Amendments to the EAR Implementing U.S.-India Bilateral
Understanding
Part 744
In this rule, BIS amends the EAR to remove the following entities
from Supplement No. 4 to part 744 of the EAR, i.e., the Entity List:
Bharat Dynamics Limited (BDL).
All subordinates of India's Defense Research and
Development Organization (DRDO) identified on the Entity List
immediately prior to the effective date of this rule, namely:
--Armament Research and Development Establishment (ARDE);
--Defense Research and Development Lab (DRDL);
--Missile Research and Development Complex; and
--Solid State Physics Laboratory.
All Indian Space Research Organization (ISRO) subordinate
entities identified on the Entity List immediately prior to the
effective date of this rule, namely:
--Liquid Propulsion Systems Center;
--Solid Propellant Space Booster Plant (SPROB);
--Sriharikota Space Center (SHAR); and
--Vikram Sarabhai Space Center (VSSC).
The removal of these nine Indian entities from the Entity List
eliminates the existing license requirements in the Entity List,
Supplement No. 4 to part 744, for exports, reexports, and transfers
(in-country), to these entities. The removal of these entities from the
Entity List does not, however, relieve persons of other obligations in
part 744 of the EAR or under other applicable parts of the EAR. For
example, neither the removal of a person from the Entity List nor the
removal of Entity List-based license requirements relieves persons of
their obligation to adhere to General Prohibition 5 in section
736.2(b)(5) of the EAR, which provides that ``you may not, without a
license, knowingly export or reexport any item subject to the EAR to an
end-user or end-use that is prohibited by part 744 of the EAR.''
Persons must also refrain from undertaking transfers (in-country) to an
end-user or end-use that is prohibited by any provision of part 744.
Additionally, such removals do not relieve persons of their obligation
to apply for export, reexport, or transfer (in-country) licenses
required by other provisions of the EAR. BIS strongly urges persons to
review and abide by Supplement No. 3 to part 732 of the EAR, ``BIS's
`Know Your Customer' Guidance and Red Flags,'' when involved in
transactions that are subject to the EAR.
Parts 738 and 740
In this rule, BIS also removes India from Country Groups D:2, D:3,
and D:4 to Supplement No. 1 to part 740 of the EAR. These Country
Groups list countries with certain restrictions on end-uses for nuclear
nonproliferation (D:2), chemical & biological (D:3), and missile
technology (D:4) reasons under the EAR. This rule also adds India to
Country Group A:2 to Supplement No. 1 to part 740 of the EAR, makes
License Exception (BAG) (section 740.14(d) of the EAR) available for
exports and
[[Page 4230]]
reexports of unaccompanied baggage to India, and makes India an
eligible destination for reexports under License Exception Additional
Permissive Reexports (APR) (section 740.16(a) of the EAR).
Country Group D:2: India's removal from Country Group D:2 will not
change licensing policy toward India for items controlled for nuclear
nonproliferation (NP column 1(NP1), Supplement No. 1 to part 738
(Commerce Country Chart) of the EAR) reasons; a license will still be
required for the export of NP1 items to all destinations in India.
U.S.-origin items controlled unilaterally for nuclear nonproliferation
reasons (NP2) do not require a license for most destinations in India.
Prior to publication of this rule, paragraph (a)(2) of section 742.3 of
the EAR expressly exempted India from the license requirement for
Country Group D:2 countries. India's removal from Country Group D:2
through this rule, however, makes this express exemption unnecessary,
and it is therefore being removed. The removal of India from Country
Group D:2 also eliminates a license requirement for India under section
744.6 of the EAR for certain U.S. person activities that involve any
D:2 country. India, however, remains subject to the ``catch-all''
controls in section 744.2 of the EAR (Restrictions on Certain Nuclear
End-uses). Under section 744.2, a person may not export, reexport, or
transfer (in-country) an item subject to the EAR to India without a
license if, at the time of export, reexport, or transfer (in-country),
the person knows that the item will be used, directly or indirectly, in
activities described in paragraphs (a)(1), (a)(2), and (a)(3) of
section 744.2, i.e., certain nuclear explosive activities,
unsafeguarded nuclear activities, or certain safeguarded and
unsafeguarded nuclear activities.
Country Group D:3: The removal of India from Country Group D:3
means that paragraph (a)(3) of section 742.2 (Proliferation of Chemical
and Biological Weapons) of the EAR will not impose a license
requirement for exports or reexports to India of medical products,
identified in Export Control Classification Number (ECCN) 1C991.d,.
Removal of India from Country Group D:3 also means that end users in
India are eligible to receive certain items controlled for chemical and
biological weapons reasons under special comprehensive licenses (SCLs)
described in part 752 of the EAR. Items controlled for chemical and
biological weapons reasons are ineligible for export or reexport under
a SCL to D:3 destinations.
Furthermore, consistent with the removal of India from Country
Group D:3, this rule removes licensing requirements for certain items
controlled for chemical and biological weapons proliferation reasons
for export or reexport to India, by removing the ``X'' in ``CB Column
3'' for ``India'' in Supplement No. 1 to part 738 (Commerce Country
Chart) of the EAR.
Country Group D:4: Removal of India from Country Group D:4
eliminates the requirement for export, reexport, and transfers (in-
country) licenses for India under paragraphs (a)(1) and (a)(3) of
section 744.3 (Restrictions on Certain Rocket Systems and Unmanned Air
Vehicles End-Uses). Pursuant to section 744.3(a)(2), a license will
still be required for any item if, at the time of the export, reexport,
or transfer (in-country), the person knows that the item will be used
in India in the design, development, production, or use of rocket
systems or unmanned air vehicles, regardless of range capabilities, for
the delivery of chemical, biological, or nuclear weapons. The removal
of India from Country Group D:4 also eliminates a license requirement
for India under section 744.6 of the EAR for certain U.S. person
activities that involve a D:4 country.
Removal of India from Country Groups D:2, D:3, and D:4 and the
Availability of License Exceptions: Removal of India from Country
Groups D:2, D:3, and D:4 expands the License Exceptions available for
exports and reexports to India. This rule makes available exports and
reexports to India of unaccompanied baggage under License Exception
Baggage (BAG) section 740.14(d) of the EAR. Such removal also makes
India an eligible destination for reexports under License Exception
Additional Permissive Reexports (APR) set forth in section 740.16(a) of
the EAR.
Country Group A:2: This rule also adds India to Country Group A:2,
grouping India, as an adherent to the Missile Technology Control Regime
(MTCR), with countries that are members of that regime. Under section
742.5 of the EAR, a license is still required for export and reexport
of items controlled for missile technology (MT) reasons to all
destinations except Canada.
Conforming Amendments
As noted in the discussion of Country Group D:2 above, this rule
removes a now unnecessary reference to India from section 742.3(a)(2)
of the EAR. This rule also makes a conforming change in section
742.5(d) (Missile Technology Control Regime) of the EAR regarding India
acknowledging that India is being included in Country Group A:2 as an
MTCR adherent.
Since August 21, 2001, the Export Administration Act of 1979, as
amended (Act) has been in lapse and the President, through Executive
Order 13222 of August 17, 2001 (3 CFR, 2001 Comp., p. 783 (2002)), as
extended most recently by the Notice of August 12, 2010 (75 FR 50681
(August 16, 2010)), has continued the EAR in effect under the
International Emergency Economic Powers Act. BIS continues to carry out
the provisions of the Act, as appropriate and to the extent permitted
by law, pursuant to Executive Order 13222.
Rulemaking
Rulemaking Requirements
1. This rule has been determined to be significant for purposes of
Executive Order 12866.
2. Notwithstanding any other provision of law, no person is
required to respond to or be subject to a penalty for failure to comply
with a collection of information, subject to the requirements of the
Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) (PRA), unless
that collection of information displays a currently valid Office of
Management and Budget (OMB) Control Number. This regulation involves
collections previously approved by the OMB under control numbers 0694-
0088, ``Multi-Purpose Application,'' which carries a burden hour
estimate of 58 minutes to prepare and submit form BIS-748.
Miscellaneous and recordkeeping activities account for 12 minutes per
submission. Total burden hours associated with the Paperwork Reduction
Act and Office and Management and Budget control number 0694-0088 are
not expected to increase as a result of this rule.
3. This rule does not contain policies with Federalism implications
as that term is defined in Executive Order 13132.
4. Pursuant to 5 U.S.C. 553(a)(1), the provisions of the
Administrative Procedure Act requiring notice of proposed rulemaking,
the opportunity for public participation, and a delay in effective
date, are inapplicable because this regulation involves a military or
foreign affairs function of the United States. (See 5 U.S.C. 53(a)(1)).
This final rule implements aspects of the understanding between the
United States and India reflected in the November 8, 2010 U.S.-India
Joint Statement and is not discretionary. No other law requires that a
notice of
[[Page 4231]]
proposed rulemaking and an opportunity for public comment be given for
this rule. Because a notice of proposed rulemaking and an opportunity
for public comment are not required to be given for this rule by 5
U.S.C. 553, or by any other law, the analytical requirements of the
Regulatory Flexibility Act, 5 U.S.C. 601 et seq., are not applicable.
Accordingly, no Regulatory Flexibility analysis is required and none
has been prepared. Notwithstanding these considerations, BIS welcomes
public comments and will review them on a continuing basis.
List of Subjects
15 CFR Part 738
Exports.
15 CFR Part 740
Administrative practice and procedure, Exports, Reporting and
recordkeeping requirements.
15 CFR Part 742
Exports and Terrorism.
15 CFR Part 744
Exports, Reporting and recordkeeping requirements, Terrorism.
Accordingly, parts 738, 740, 742 and 744 of the EAR (15 CFR parts
730-774) are amended as follows:
PART 738 [AMENDED]
0
1. The authority citation for part 738 continues to read as follows:
Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;
10 U.S.C. 7420; 10 U.S.C. 7430(e); 22 U.S.C. 287c; 22 U.S.C. 3201 et
seq.; 22 U.S.C. 6004; 30 U.S.C. 185(s), 185(u); 42 U.S.C. 2139a; 42
U.S.C. 6212; 43 U.S.C. 1354; 15 U.S.C. 1824a; 50 U.S.C. app. 5; 22
U.S.C. 7201 et seq.; 22 U.S.C. 7210; E.O. 13026, 61 FR 58767, 3 CFR,
1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p.
783; Notice of August 12, 2010, 75 FR 50681 (August 16, 2010).
Supplement No. 1 To Part 738--[Amended]
0
2. Supplement No. 1 to Part 738 is amended by removing the ``X'' in
``CB Column 3'' for ``India''.
PART 740--[AMENDED]
0
3. The authority citation for part 740 continues to read as follows:
Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;
22 U.S.C. 7201 et seq.; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp.,
p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice
of August 12, 2010, 75 FR 50681 (August 16, 2010).
Supplement No. 1 To Part 740--[Amended]
0
4. Supplement No. 1 to part 740 is amended:
0
a. By adding ``India'' to the Country Group A table in alphabetical
order and adding and ``X'' for ``India'' in Country Group A:2; and
0
b. By removing the entry ``India'' from the Country Group D table.
PART 742--[AMENDED]
0
5. The authority citation for part 742 continues to read as follows:
Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;
22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; 22 U.S.C. 7201 et seq.; 22
U.S.C. 7210; Sec 1503, Pub. L. 108-11, 117 Stat. 559; E.O. 12058, 43
FR 20947, 3 CFR, 1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR,
1993 Comp., p. 608; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p.
950; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222,
66 FR 44025, 3 CFR, 2001 Comp., p. 783; Presidential Determination
2003-23 of May 7, 2003, 68 FR 26459, May 16, 2003; Notice of August
12, 2010, 75 FR 50681 (August 16, 2010); Notice of November 4, 2010,
75 FR 68673 (November 8, 2010).
Sec. 742.3--[Amended]
0
6. Paragraph (a)(2) of Sec. 742.3 is amended by removing the phrase
``except India''.
0
7. Paragraph (d) of Sec. 742.5 is revised to read as follows:
Sec. 742.5 Missile technology.
* * * * *
(d) Missile Technology Control Regime. Missile Technology Control
Regime (MTCR) members, and India as an MTCR adherent, are listed in
Country Group A:2 (see Supplement No. 1 to part 740 of the EAR).
Controls on items identified in paragraph (a) of this section are
consistent with the list agreed to in the MTCR and included in the MTCR
Annex.
PART 744--[AMENDED]
0
8. The authority citation for part 744 continues to read as follows:
Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;
22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; 22 U.S.C. 7201 et seq.; 22
U.S.C. 7210; E.O. 12058, 43 FR 20947, 3 CFR, 1978 Comp., p. 179;
E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p. 608; E.O. 12938, 59
FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 12947, 60 FR 5079, 3 CFR,
1995 Comp., p. 356; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p.
228; E.O. 13099, 63 FR 45167, 3 CFR, 1998 Comp., p. 208; E.O. 13222,
66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13224, 66 FR 49079, 3
CFR, 2001 Comp., p. 786; Notice of August 12, 2010, 75 FR 50681
(August 16, 2010); Notice of November 4, 2010, 75 FR 68673 (November
8, 2010).
Supplement No. 4 To Part 744--[Amended]
0
9. The entry for ``India'' in Supplement No. 4 to part 744 is amended
by removing the following entities:
``Bharat Dynamics Limited'';
``The following subordinates of Defense Research and Development
Organization (DRDO): Armament Research and Development Establishment
(ARDE); Defense Research and Development Lab (DRDL), Hyderabad; Missile
Research and Development Complex; Solid State Physics Laboratory''; and
``The following Indian Space Research Organization (ISRO)
subordinate entities:
Liquid Propulsion Systems Center; Solid Propellant Space Booster
Plant (SPROB); Sriharikota Space Center (SHAR); and Vikram Sarabhai
Space Center (VSSC), Thiruvananthapuram.''.
Dated: January 20, 2011.
Eric L. Hirschhorn,
Under Secretary for Industry and Security.
[FR Doc. 2011-1471 Filed 1-24-11; 8:45 am]
BILLING CODE 3510-33-P