15 CFR 750 - APPLICATION PROCESSING, ISSUANCE, AND DENIAL

President Obama directed the Administration in August 2009 to conduct a broad-based review of the U.S. export control system in order to identify additional ways to enhance national security. Then-Secretary of Defense Gates described in April 2010 the initial results of that effort and why fundamental reform of the U.S. export control system is necessary to enhance national security. Since then, the Bureau of Industry and Security (BIS), Department of Commerce, and the Directorate of Defense Trade Controls (DDTC), Department of State, have published multiple proposed amendments to the Export Administration Regulations (EAR) and the International Traffic in Arms Regulations (ITAR), respectively, that would implement various aspects of what has become known as the Export Control Reform Initiative. One aspect of the reform effort would result in the transfer of control to the EAR of items the President determines no longer warrant control under ITAR, once congressional notification requirements and corresponding amendments to the ITAR and the EAR are completed. This proposed rule addresses issues pertaining to transition of control over such items. It complements the Export Control Transition Plan, a proposed policy statement and request for comments issued by DDTC. This rule proposes to amend the EAR by, inter alia, establishing a General Order regarding continued use of State authorizations for a specified period, by broadening license exceptions in the EAR to make them consistent with ITAR exemptions, and by extending the validity period of Commerce licenses. Any modifications to License Exceptions specific to particular types of items, such as firearms, will be addressed in the proposed rules pertaining specifically to those items. This rule also addresses specific concerns raised in public comments on recent rules by proposing a revised de minimis rule for “600 series” items, i.e., the items the President determines no longer warrant control on the USML and that would thus be controlled in the “600 series” of the EAR's Commerce Control List (CCL). Finally, this rule proposes additional conforming changes that are necessary to implement the Export Control Reform Initiative, but also would affect items currently subject to the EAR, such as changes to reporting thresholds for the Automated Export System. In addition, this proposed rule addresses issues raised by the public in response to a notice requesting comments on the streamlining of BIS's regulations published on August 5, 2011 (76 FR 47527). On January 18, 2011, President Barack Obama issued Executive Order 13563, affirming general principles of regulation and directing government agencies to conduct retrospective reviews of existing regulations. Although the Export Control Reform Initiative did not originate with Executive Order 13563, it is entirely consistent in spirit and substance. BIS issued a notice soliciting public comment on streamlining its regulations pursuant to the President's Executive Order. In response to the public comments received on the notice, and consistent with BIS's internal analysis, this rule proposes revisions to license exceptions for government uses and temporary exports that streamline and update unduly complex or outmoded provisions in addition to broadening certain provisions to implement Export Control Reform. Other proposed changes to the EAR warranted by the Executive Order will be addressed in separate Federal Register notices. Commerce's full plan can be accessed at: http://open.commerce.gov/news/2011/08/23/commerce-plan-retrospective-analysis-existing-rules.