[Code of Federal Regulations]
[Title 15, Volume 2]
[Revised as of January 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 15CFR742.4]

[Page 292-293]
 
                  TITLE 15--COMMERCE AND FOREIGN TRADE
 
  CHAPTER VII--BUREAU OF EXPORT ADMINISTRATION, DEPARTMENT OF COMMERCE
 
PART 742--CONTROL POLICY--CCL BASED CONTROLS--Table of Contents
 
Sec. 742.4  National security.

    (a) License requirements. It is the policy of the United States to 
restrict the export and reexport of items that would make a significant 
contribution to the military potential of any other country or 
combination of countries that would prove detrimental to the national 
security of the United States. Accordingly, a license is required for 
exports and reexports to all destinations, except Canada, for all items 
in ECCNs on the CCL that include NS Column 1 in the Country Chart column 
of the ``License Requirements'' section. A license is required to all 
destinations except Country Group A:1 and cooperating countries (see 
Supplement No. 1 to part 740) for all items in ECCNs on the CCL that 
include NS Column 2 in

[[Page 293]]

the Country Chart column of the ``License Requirements'' section. The 
purpose of the controls is to ensure that these items do not make a 
contribution to the military potential of countries in Country Group D:1 
(see Supplement No. 1 to part 740 of the EAR) that would prove 
detrimental to the national security of the United States. License 
Exception GBS is available for the export and reexport of certain 
national security controlled items to Country Group B (see Sec. 740.4 
and Supplement No. 1 to part 740 of the EAR).
    (b) Licensing policy. (1) The policy for national security 
controlled items exported or reexported to any country except a country 
in Country Group D:1 (see Supplement No. 1 to part 740 of the EAR) is to 
approve applications unless there is a significant risk that the items 
will be diverted to a country in Country Group D:1.
    (2) Except for those countries described in paragraphs (b)(5) 
through (b)(7) of this section, the general policy for exports and 
reexports of items to Country Group D:1 (see Supplement No. 1 to part 
740 of the EAR) is to approve applications when BXA determines, on a 
case-by-case basis, that the items are for civilian use or would 
otherwise not make a significant contribution to the military potential 
of the country of destination that would prove detrimental to the 
national security of the United States.
    (3) To permit such policy judgments to be made, each application is 
reviewed in the light of prevailing policies with full consideration of 
all aspects of the proposed transaction. The review generally includes:
    (i) An analysis of the kinds and quantities of items to be shipped;
    (ii) Their military or civilian uses;
    (iii) The unrestricted availability abroad of the same or comparable 
items;
    (iv) The country of destination;
    (v) The ultimate end-users in the country of destination; and
    (vi) The intended end-use.
    (4) Although each proposed transaction is considered individually, 
items described in Advisory Notes on the Commerce Control List are more 
likely to be approved than others.
    (5) In recognition of efforts made to adopt safeguard measures for 
exports and reexports, Bulgaria, Latvia, Kazakhstan, Lithuania, 
Mongolia, and Russia are accorded enhanced favorable consideration 
licensing treatment.
    (6) The general policy for Cambodia and Laos is to approve license 
applications when BXA determines, on a case-by-case basis, that the 
items are for an authorized use in Cambodia or Laos and are not likely 
to be diverted to another country or use contrary to the national 
security or foreign policy controls of the United States.
    (7) For the People's Republic of China, the general licensing policy 
is to approve applications, except that those items that would make a 
direct and significant contribution to electronic and anti-submarine 
warfare, intelligence gathering, power projection, and air superiority 
receive extended review or denial. Each application will be considered 
individually. Items may be approved even though they may contribute to 
Chinese military development or the end-user or end-use is military. 
Note that the Advisory Notes in the CCL headed ``Note for the People's 
Republic of China'' provide guidance on equipment likely to be approved 
more rapidly for China.
    (c) Contract sanctity. Contract sanctity provisions are not 
available for license applications reviewed under this section.
    (d) [Reserved]

[61 FR 12786, Mar. 25, 1996, as amended at 61 FR 64283, Dec. 4, 1996]