Application of foreign-direct product rules to Iran

(a)

In general

Beginning on the date that is 90 days after the date of the enactment of this Act, a foreign-produced item shall be subject to the Export Administration Regulations (pursuant to the Export Control Reform Act of 2018 (50 U.S.C. 4801 et seq.)) if the item— (1)meets— (A)the product scope requirements described in subsection (b); and (B)the destination scope requirements described in subsection (c); and (2)is exported, reexported, or in-country transferred to Iran from abroad or involves the Government of Iran. (b)

Product scope requirements

A foreign-produced item meets the product scope requirements of this subsection if the item— (1)is a direct product of United States-origin technology or software subject to the Export Administration Regulations that is specified in a covered Export Control Classification Number or is identified in supplement no. 7 to part 746 of the Export Administration Regulations; or (2)is produced by any plant or major component of a plant that is located outside the United States, if the plant or major component of a plant, whether made in the United States or a foreign country, itself is a direct product of United States-origin technology or software subject to the Export Administration Regulations that is specified in a covered Export Control Classification Number. (c)

Destination scope requirements

A foreign-produced item meets the destination scope requirements of this subsection if there is knowledge that the foreign-produced item is destined to Iran or will be incorporated into or used in the production or development of any part, component, or equipment subject to the Export Administration Regulations and produced in or destined to Iran. (d)

License requirements

(1)

In general

A license shall be required to export, reexport, or in-country transfer a foreign-produced item from abroad that meets the product scope requirements described in subsection (b) and the destination scope requirements described in subsection (c) and is subject to the Export Administration Regulations pursuant to this section. (2)

Exceptions

The license requirements of paragraph (1) shall not apply to— (A)food, medicine, or medical devices that are— (i)designated as EAR99; or (ii)not designated under or listed on the Commerce Control List; or (B)services, software, or hardware (other than services, software, or hardware for end-users owned or controlled by the Government of Iran) that are— (i)necessarily and ordinarily incident to communications; or (ii)designated as— (I)EAR99; or (II)Export Control Classification Number 5A992.c or 5D992.c, and classified in accordance with section 740.17 of title 15 Code of Federal Regulations; and (iii)subject to a general license issued by the Department of Commerce or Department of Treasury. (e)

National interest waiver

The Secretary of Commerce may waive the requirements imposed under this section if the Secretary— (1)determines that the waiver is in the national interests of the United States; and (2)submits to the Committee on Foreign Affairs of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate a report explaining which requirements are being waived and the reasons for the waiver. (f)

Sunset

The authority provided under this section shall terminate on the date that is 7 years after the date of the enactment of this Act. (g)

Definitions

In this section— (1)the term Commerce Control List means the list maintained pursuant to part 744 of the Export Administration Regulations; (2)the term covered Export Control Classification Number means an Export Control Classification Number in product group D or E of Category 3, 4, 5, 6, 7, 8, or 9 of the Commerce Control List; (3)the terms Export Administration Regulations, export, reexport, and in-country transfer have the meanings given those terms in section 1742 of the Export Control Reform Act of 2018 (50 U.S.C. 4801); and (4)the terms direct product, technology, software, major component, knowledge, production, development, part, component, equipment, and government end users have the meanings given those terms in section 734.9 or part 772 of the Export Administration Regulations, as the case may be.