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U.S. Makes or Considers Various Changes to Existing Export Controls

The State Department and the U.S. Department of Commerce’s Bureau of Industry of Security have made or are considering the following changes to U.S. export controls.

Hong Kong
BIS has issued a final rule requiring persons intending to export or re-export to Hong Kong any item subject to the Export Administration Regulations and controlled on the Commerce Control List for national security, missile technology, nuclear non-proliferation (NP column 1), or chemical and biological weapons reasons to obtain, prior to such export or re-export, a copy of a Hong Kong import licence or a written statement from the Hong Kong government that such a licence is not required. The rule also requires persons intending to re-export from Hong Kong any item subject to the EAR and controlled for NS, MT, NP column 1 or CB reasons to obtain a Hong Kong export licence or a statement from the Hong Kong government that such a licence is not required.

For purposes of this rule, a written statement issued by the Hong Kong government includes either a written communication to a licence applicant informing the applicant that the item does not require a licence or a statement available to the general public (including a statement on a Web site by the Hong Kong government) that a licence is not required for the item. In instances where a Hong Kong licence is issued for re-exports, the re-export must be in accordance with the terms of that licence and must be completed during the validity period of the Hong Kong-issued export licence.

BIS expects that in nearly all instances this rule, which will enter into force on 19 April, will require only that a party in Hong Kong obtain a licence that is already required under Hong Kong law. In those instances, no new action is required by persons re-exporting from Hong Kong. However, the rule will require companies to establish new processes for obtaining a copy of a Hong Kong import licence prior to shipping controlled items to Hong Kong.

BIS adds that it is taking this action to provide greater assurance that U.S. origin items that are subject to the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies, the Missile Technology Control Regime, the Nuclear Suppliers Group and the Australia Group will be properly authorised by the United States to their final destination even when those items first pass through Hong Kong.

Spacecraft Systems
BIS and State have issued final rules that effective 15 January make further changes to their May 2014 interim final rules concerning export controls on satellites and related articles. BIS states that the changes made in its final rule are grouped into four types: (i) changes to address the movement of additional spacecraft and related items from the U.S. Munitions List to the CCL as a result of changes in aperture size for spacecraft that warrant control under the International Traffic in Arms Regulations; (ii) changes to address the movement of the James Webb Space Telescope from the USML to the CCL; (iii) other corrections and clarifications; and (iv) the addition of .y items to Export Control Classification Number 9A515. The State Department states that its rule further revises category XV (spacecraft and related articles) of the USML to better reflect the intended scope of control with regard to autonomous tracking systems, logistics, propulsion systems, cryocoolers and vibration suppression systems.

Infrared Detection Systems
BIS and State are accepting comments through 15 March on the impact of imposing additional licence requirements on exports of certain infrared detection items. BIS is seeking comments on the foreign availability of the subject items as well as the effect the tighter controls would have on U.S. national security or foreign policy interests, U.S. export performance, the competitive position of the U.S. in the international economy, the international reputation of the United States as a supplier of goods and technology, or the economic wellbeing of individual U.S. companies. This includes comments addressing the competitive advantage of U.S. companies vis-à-vis non-U.S. companies, any impacts to the technological edge of U.S. companies, and whether these changes would influence assembly and integration activities inside and outside of the United States. Public comments should also state whether or not foreign availability exists for items subject to potential additional controls and, to the extent that it does, describe such foreign availability in detail.

State, meanwhile, is seeking input on alternatives to controls on certain items when specially designed for a military end-user, the scope of the control in paragraph (b)(1) of category XII of the USML (on all laser target designators and coded target markers that can mediate the delivery of ordnance to a target) and certain technical parameters it is evaluating to replace “specially designed” controls.

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