[Federal Register Volume 65, Number 48 (Friday, March 10, 2000)]
[Rules and Regulations]
[Pages 12919-12924]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-5516]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

Bureau of Export Administration

15 CFR Parts 734, 738, 740, 742, 743, 744, 748 and 774

[Docket No. 000204027-0027-01]
RIN 0694-AC14


Revisions to License Exception CTP

AGENCY: Bureau of Export Administration, Commerce.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Bureau of Export Administration (BXA) is amending the 
Export Administration Regulations (EAR) by revising License Exception 
CTP to reflect continuing technological advancement in the computer 
industry. Accordingly, High Performance Computers (HPCs) with a 
composite theoretical performance (CTP) of up to 33,000 millions of 
theoretical operations per second (MTOPS) can be exported to Computer 
Tier 2 countries, and HPCs with a CTP up to 20,000 MTOPS can be 
exported to civilian end-users and end-uses in Computer Tier 3 
destinations under License Exception CTP. For military end-users and 
end-uses in Computer Tier 3 countries, the CTP limit remains at 6,500 
MTOPS until August 14, 2000, when it is raised to 12,500 MTOPS. This 
coincides with the date this rule raises the advance notification level 
for HPC exports to Computer Tier 3 countries to 12,500 MTOPS. As 
required by the National Defense Authorization Act of 1998 (NDAA), 
changes in the advance notification level for HPC exports to Tier 3 
destinations are only effective 180 days following the submission of a 
report to Congress. This report was sent to Congress on February 16, 
2000. This rule also moves Romania from Computer Tier 3 to Computer 
Tier 2, effective June 15, 2000, and links the level of HPCs requiring 
post-shipment verification reporting to the advance notification level 
for HPC exports to Computer Tier 3 destinations. This rule also revises 
the Commerce Control List (CCL) to liberalize the national security 
thresholds for digital computers to conform with recently agreed 
changes in the Wassenaar List of Dual-Use Goods and Technologies, and 
corrects/updates the mailing address for submission of post-shipment 
reports.

DATES: This rule is effective March 10, 2000.

FOR FURTHER INFORMATION CONTACT: James A. Lewis, Office of Strategic 
Trade and Foreign Policy Controls,

[[Page 12920]]

Bureau of Export Administration, Telephone: (202) 482-0092.

SUPPLEMENTARY INFORMATION:

Background

    On February 1, 2000, the President announced significant changes to 
export control policy for HPCs. The new policy continues the 
Administration's commitment, as announced on July 1, 1999, to review 
and update its HPC policy every 6 months to reflect rapid advancements 
in microprocessor technology, as well as identify any risk posed by HPC 
exports to certain end-users and countries. This policy strengthens 
America's high-tech competitiveness, while maintaining export controls 
to protect U.S. national security.
    The Administration, in consultation with the national security 
community and industry, has determined the following adjustments are 
warranted. Effective immediately, the upper License Exception CTP level 
for Computer Tier 2 countries is raised from 20,000 to 33,000 MTOPS and 
the upper License Exception CTP level for civil end-users and civil 
end-uses in Computer Tier 3 countries is raised from 12,300 to 20,000 
MTOPS. For military end-users and end-uses in Computer Tier 3 
countries, the upper CTP level remains at 6,500 MTOPS until August 14, 
2000, when it is raised to 12,500 MTOPS. This coincides with the date 
this rule raises the advance notification level for HPC exports to 
Computer Tier 3 countries from 6,500 to 12,500 MTOPS. As required by 
the NDAA, changes in the advance notification level for HPC exports to 
Tier 3 destinations are only effective 180 days following the 
submission of a report to Congress. This report was sent to Congress on 
February 16, 2000. This new advance notification level reflects the 
Administration's determination that widespread commercial availability 
of computers with performance capabilities up to 12,500 MTOPS makes 
that a realistic and enforceable level.
    This rule removes Romania from Computer Tier 3 and places it in 
Computer Tier 2. However, due to requirements in the 1998 NDAA, 
removing Romania from Computer Tier 3 is not effective until 120 days 
after the Congress receives a report justifying such a removal. On 
February 16, 2000, the President informed the Congress of his intent to 
remove Romania from Computer Tier 3; thus, Romania will be moved to 
Computer Tier 2 effective June 15, 2000.
    This rule also links the performance level of HPCs requiring post-
shipment verification reporting to the advance notification level for 
HPC exports to Computer Tier 3 destinations. This change implements 
Section 1407(c) of the National Defense Authorization Act for Fiscal 
Year 2000 (P.L. 106-65, October 5, 1999), which amended Section 1213(e) 
of the NDAA for FY98. As a result, post-shipment verification reporting 
is required for exports of computers with a CTP greater than 6,500 
MTOPS to Computer Tier 3 destinations made on or after January 23, 
2000. Post-shipment verification reporting is required for exports of 
computers with a CTP greater than 12,500 MTOPS to Computer Tier 3 
destinations made on or after August 14, 2000.
    In addition, this rule amends Export Control Classification Number 
(ECCN) 4A003 by increasing the control level for digital computers from 
2,000 to 6,500 MTOPS to conform with recently agreed changes in the 
Wassenaar List of Dual-Use Goods and Technologies. To fulfill U.S. 
commitments to the Wassenaar Arrangement with regard to dual-use items, 
this final rule also revises the reporting requirements for exports of 
digital computers controlled under the Wassenaar Arrangement and by 
conforming Sec. 740.7 (License Exception CTP) and Sec. 742.12 (High 
Performance Computers) to be consistent with the recently agreed 
national security levels for digital computers.
    Finally, this rule makes conforming changes in parts 734, 738, 742, 
744 and 748.
    Due to rapid advancement in HPC and microprocessor technology, the 
United States will routinely review these levels to determine if 
further adjustments are warranted. In particular, agencies will review 
control levels by April 2000 to determine if further changes are 
warranted; additional countries may also be moved between tiers.
    Although the Export Administration Act (EAA) expired on August 20, 
1994, the President invoked the International Emergency Economic Powers 
Act and continued in effect the EAR, and to the extent permitted by 
law, the provisions of the EAA, as amended, in Executive Order 12924 of 
August 19, 1994, as extended by the President's notices of August 15, 
1995 (60 FR 42767), August 14, 1996 (61 FR 42527), August 13, 1997 (62 
FR 43629), August 13, 1998 (63 FR 44121), and August 13, 1999 (64 FR 
44101).

Rulemaking Requirements

    1. This final rule has been determined to be significant for 
purposes of E.O. 12866.
    2. Notwithstanding any other provision of law, no person is 
required to respond to nor be subject to a penalty for failure to 
comply with a collection of information subject to the requirements of 
the Paperwork Reduction Act unless that collection of information 
displays a current valid OMB Control Number. This regulation involves 
collections previously approved by the Office of Management and Budget 
under control numbers 0694-0088, ``Multi-Purpose Application,'' which 
carries a burden hour estimate of 45 minutes per manual submission and 
40 minutes per electronic submission. Miscellaneous and recordkeeping 
activities account for 12 minutes per submission. Information is also 
collected under OMB control number 0694-0107, ``National Defense 
Authorization Act,'' Advance Notifications and Post-Shipment 
Verification Reports, which carries a burden hour estimate of 15 
minutes per report. Information is also collected under OMB control 
number 0694-0106, ``Reporting and Recordkeeping Requirements under the 
Wassenaar Arrangement EAR Section 743'', which carries a burden hour 
estimate of 11 minutes per report. This rule also involves collections 
of information under OMB control number 0694-0073, ``Export Controls of 
High Performance Computers'' and OMB control number 0694-0093, ``Import 
Certificates and End-User Certificates''.
    3. This rule does not contain policies with Federalism implications 
sufficient to warrant preparation of a Federalism assessment under 
Executive Order 13132.
    4. The provisions of the Administrative Procedure Act requiring 
notice of proposed rule making, 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. 553(a)(1)). Further, no other law requires 
that a notice of proposed rule making and an opportunity for public 
comment be given for this rule. Because a notice of proposed rule 
making and opportunities 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 inapplicable.
    Therefore, this regulation is issued in final form. Although there 
is no formal comment period, public comments on this regulation are 
welcome on a continuing basis. Comments should be submitted to Office 
of Exporter Services, Bureau of Export Administration,

[[Page 12921]]

Department of Commerce, P.O. Box 273, Washington, D.C. 20044.

List of Subjects

15 CFR Parts 734 and 738

    Administrative practice and procedure, Exports, Foreign trade.

15 CFR Parts 740, 743 and 748

    Administrative practice and procedure, Exports, Foreign trade, 
Reporting and record keeping requirements.

15 CFR Part 742

    Exports, Foreign trade.

15 CFR Parts 744 and 774

    Exports, Foreign trade, Reporting and recordkeeping requirements.

    Accordingly, parts 734, 738, 740, 742, 743, 744, 748 and 774 of the 
Export Administration Regulations (15 CFR Parts 730-774) are amended as 
follows:
    1. The authority citation for 15 CFR part 734 continues to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
E.O. 12924, 59 FR 43437, 3 CFR, 1994 Comp., p. 917; E.O. 12938, 59 
FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13020, 61 FR 54079, 3 CFR, 
1996 Comp. p. 219; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 
228; Notice of November 12, 1998, 63 FR 63589, 3 CFR, 1998 Comp., p. 
305; Notice of August 10, 1999, 64 FR 44101 (August 13, 1999).


    2. The authority citation for 15 CFR 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); 18 U.S.C. 2510 et seq.; 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; 46 U.S.C. 
app. 466c; 50 U.S.C. app. 5; E.O. 12924, 59 FR 43437, 3 CFR, 1994 
Comp., p. 917; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; 
Notice of August 10, 1999, 64 FR 44101 (August 13, 1999).


    3. The authority citation for 15 CFR Part 740 continues to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
E.O. 12924, 59 FR 43437, 3 CFR, 1994 Comp., p. 917; E.O. 13026, 61 
FR 58767, 3 CFR, 1996 Comp., p. 228; Notice of August 10, 1999, 64 
FR 44101 (August 13, 1999).


    4. The authority citation for 15 CFR Part 742 continues to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
18 U.S.C. 2510 et seq.; 22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; 
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. 12924, 59 FR 43437, 3 CFR, 
1994 Comp., p. 917; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 
950; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; Notice of 
November 12, 1998, 63 FR 63589, 3 CFR, 1998 Comp., p. 305; Notice of 
August 10, 1999, 64 FR 44101 (August 13, 1999).


    5. The authority citation for 15 CFR part 743 continues to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
E.O. 12924, 59 FR 43437, 3 CFR, 1994 Comp., p. 917; Notice of August 
10, 1999, 64 FR 44101 (August 13, 1999).

    6. The authority citation for 15 CFR part 744 is revised to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq., 1701 et seq.; 22 U.S.C. 
3201 et seq.; 42 U.S.C. 2139a; 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. 12924, 59 FR 43437, 3 CFR, 1994 Comp., p. 917; E.O. 12938, 59 
FR 59099, 3 CFR, 1994 Comp., p. 950; Notice of August 15, 1995 (60 
FR 42767, August 17, 1995); Notice of August 14, 1996 (61 FR 42527); 
Notice of August 13, 1997 (62 FR 43629, August 15, 1997); Notice of 
August 10, 1999, 64 FR 44101 (August 13, 1999).


    7. The authority citation for 15 CFR part 748 continues to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
E.O. 12924, 59 FR 43437, 3 CFR, 1994 Comp., p. 917; E.O. 13026, 61 
FR 58767, 3 CFR, 1996 Comp., p. 228; Notice of August 10, 1999, 64 
FR 44101 (August 13, 1999).


    8. The authority citation for part 774 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); 18 U.S.C. 2510 et seq.; 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; 46 U.S.C. 
app. 466c; 50 U.S.C. app. 5; E.O. 12924, 59 FR 43437, 3 CFR, 1994 
Comp., p. 917; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; 
Notice of August 10, 1999, 64 FR 44101 (August 13, 1999).

PART 734--[AMENDED]


Sec. 734.4  [Amended]

    9. Section 734.4 is amended by revising the phrase ``12,300 MTOPS'' 
in paragraph (a) to read ``20,000 MTOPS''.

PART 738--[AMENDED]

    10. Supplement No. 1 to Part 738 is amended by revising the phrase 
``greater than 20,000 MTOPS'' in the second footnote to read ``greater 
than 33,000 MTOPS''.

PART 740--[AMENDED]

    11. Section 740.7 is amended by:
    a. Adding a sentence at the end of paragraph (c)(1) and adding two 
sentences at the end of paragraph (d)(1); and
    b. Revising paragraphs (b)(2), (c)(2), (d)(2), (d)(5)(i), 
(d)(5)(v), introductory text (d)(5)(v)(B)(1), and (d)(5)(v)(B)(2) to 
read as follows:


Sec. 740.7  Computers (CTP).

* * * * *
    (b) * * *
    (2) Eligible Computers. The computers eligible for License 
Exception CTP to Tier 1 destinations are those having a Composite 
Theoretical Performance (CTP) greater than 6,500 Millions of 
Theoretical Operations Per Second (MTOPS).
* * * * *
    (c) * * *
    (1) Eligible Countries. * * * As of June 15, 2000, Romania is a 
Computer Tier 2 country.
    (2) Eligible computers. The computers eligible for License 
Exception CTP to Tier 2 destinations are those having a CTP greater 
than 6,500 MTOPS, but less than or equal to 33,000 MTOPS.
    (d) * * *
    (1) Eligible Countries. * * * Until June 14, 2000, Romania is a 
Computer Tier 3 country. As of June 15, 2000, Romania is moved to 
Computer Tier 2.
    (2) Eligible computers. Computers with a CTP greater than 6,500 
MTOPS, but less than or equal to 20,000 MTOPS, are eligible for License 
Exception CTP to civil end-users and end-uses. Beginning on August 14, 
2000, computers having a CTP greater than 6,500 MTOPS, but less than or 
equal to 12,500 MTOPS, are eligible for License Exception CTP to 
military end-users and end-uses subject to the restrictions in 
paragraph (d)(3) of this section.
* * * * *
    (5) NDAA notification. (i) General requirement. The National 
Defense Authorization Act (NDAA) of FY98 enacted on November 18, 1997 
requires advance notification of certain exports and reexports of 
computers to Computer Tier 3 countries. Prior to August 14, 2000, 
advance notification is required for all exports and reexports of 
computers with a CTP greater than 6,500 but less than or equal to 
20,000 MTOPS to Computer Tier 3 destinations. Beginning on August 14, 
2000, advance notification is required for all exports and reexports of 
computers with a CTP greater than 12,500 but less than or equal to 
20,000 MTOPS to Computer Tier 3 destinations. For each such transaction 
destined to Computer Tier 3, prior to using License Exception CTP, you 
must first notify BXA by submitting a completed Multipurpose 
Application Form (BXA-748P). The Multipurpose Application Form must be 
completed including all information required for a license application 
according to the

[[Page 12922]]

instructions described in Supplement No. 1 to part 748 of the EAR, with 
two exceptions. You (the applicant as listed in Block 14) shall in 
Block 5 (Type of Application) mark the box ``Other.'' This designator 
will permit BXA to route the NDAA notice into a special processing 
procedure. (Blocks 6 and 7, regarding support documentation, may be 
left blank.) You must also provide a notice using this procedure prior 
to exporting or reexporting items that you know will be used to enhance 
beyond 6,500 MTOPS the CTP of a previously exported or reexported 
computer. Beginning on August 14, 2000, you must provide a notice using 
this procedure prior to exporting or reexporting items that you know 
will be used to enhance beyond 12,500 MTOPS the CTP of a previously 
exported or reexported computer. BXA will not initiate the registration 
of an NDAA notice unless all information on the Multipurpose 
Application form is complete.
* * * * *
    (v) Post-shipment verification. This section outlines special post-
shipment reporting requirements for exporters of certain computers to 
destinations in Computer Tier 3. Exporters must file post-shipment 
reports for computer exports, as well as exports of items used to 
enhance previously exported or reexported computers, according to the 
following schedule: for exports occurring on or after February 3, 1998, 
but on or before January 22, 2000, reports are required for computers 
with a CTP greater than 2,000 MTOPS; for exports occurring on or after 
January 23, 2000, but on or before August 13, 2000, reports are 
required for computers with a CTP greater than 6,500 MTOPS; and for 
exports occurring on or after August 14, 2000, reports are required for 
computers with a CTP greater than 12,500 MTOPS. Post-shipment reports 
must be submitted in accordance with the provisions of this paragraph 
(d)(5)(v), and all relevant records of such exports must be kept in 
accordance with part 762 of the EAR.
    (A) * * *
    (B) * * *
    (1) For deliveries by U.S. postal service: Bureau of Export 
Administration, U.S. Department of Commerce, P.O. Box 273, Attn: Office 
of Enforcement Analysis HPC Team, Room 4065, Washington, D.C. 20044.
    (2) For courier deliveries: U.S. Department of Commerce, Office of 
Enforcement Analysis HPC Team, Room 4065, 14th Street and Constitution 
Ave. NW, Washington, DC 20230.
* * * * *


Sec. 740.11  [Amended]

    12. Section 740.11 is amended by revising the phrase ``20,000 
MTOPS'' in paragraphs (a)(2)(ii) and (iii) and in paragraph (c)(2)(i) 
to read ``33,000 MTOPS''.
    13. Supplement No. 1 to section 740.11 is amended by revising the 
phrase ``20,000 MTOPS'' in paragraphs (a)(1)(ii), (a)(1)(iii), 
(b)(1)(ii), and (b)(1)(iii) to read ``33,000 MTOPS''.

PART 742--[AMENDED]

    14. Section 742.12 is amended by revising the phrase ``greater than 
2000'' in paragraph (a)(1) to read ``greater than 6,500''; revising the 
phrase ``4,000 MTOPS'' in paragraph (a)(3) to read ``6,500 MTOPS''; 
revising the phrase ``greater than 20,000'' in paragraph (b)(2)(i) to 
read ``greater than 33,000''; revising the phrase ``2,000 MTOPS'' in 
paragraphs (b)(3)(i)(A), (b)(3)(iii), and (b)(3)(iv) to read ``6,500 
MTOPS'' wherever it occurs; and by revising paragraphs (b)(3)(i)(B), 
(b)(3)(i)(C), (b)(3)(iv) introductory text, (b)(3)(iv)(B)(1), and 
(b)(3)(iv)(B)(2) to read as follows:
* * * * *


Sec. 742.12  High Performance Computers

* * * * *
    (b) * * *
    (3) * * *
    (i) * * *
    (B) A license is required to export or reexport computers with a 
CTP greater than 20,000 MTOPS for civilian end-users and end-uses in 
countries in Computer Tier 3. Prior to August 14, 2000, a license is 
required to export or reexport computers having a CTP greater than 
6,500 MTOPS to military end-users and end-uses in Computer Tier 3. 
Beginning on August 14, 2000, a license is required to export or 
reexport computers having a CTP greater than 12,500 MTOPS to military 
end-users and end-uses in Computer Tier 3.
    (C) Prior to August 14, 2000, a license may be required to export 
or reexport computers with a CTP greater than 6,500 MTOPS to countries 
in Computer Tier 3 pursuant to the NDAA (see Sec. 740.7(d)(5) of the 
EAR). Beginning on August 14, 2000, a license may be required to export 
or reexport computers with a CTP greater than 12,500 MTOPS to countries 
in Computer Tier 3 pursuant to the NDAA (see Sec. 740.7(d)(5) of the 
EAR).
    (ii) * * *
    (iii) * * *
    (iv) Post-shipment verification. This section outlines special 
post-shipment reporting requirements for exporters of certain computers 
to destinations in Computer Tier 3. Exporters must file post-shipment 
reports for computer exports, as well as exports of items used to 
enhance previously exported or reexported computers, according to the 
following schedule: for exports occurring on or after February 3, 1998, 
but on or before January 22, 2000, reports are required for computers 
with a CTP greater than 2,000 MTOPS; for exports occurring on or after 
January 23, 2000, but on or before August 13, 2000, reports are 
required for computers with a CTP greater than 6,500 MTOPS; and for 
exports occurring on or after August 14, 2000, reports are required for 
computers with a CTP greater than 12,500 MTOPS. Post-shipment reports 
must be submitted in accordance with the provisions of this paragraph 
(b)(3)(iv), and all relevant records of such exports must be kept in 
accordance with part 762 of the EAR.
    (A) * * *
    (B) * * *
    (1) For deliveries by U.S. postal service: Bureau of Export 
Administration, U.S. Department of Commerce, P.O. Box 273, Attn: Office 
of Enforcement Analysis HPC Team, Room 4065, Washington, D.C. 20044.
    (2) For courier deliveries: U.S. Department of Commerce, Office of 
Enforcement Analysis HPC Team, Room 4065, 14th Street and Constitution 
Ave. NW, Washington, DC 20230.
* * * * *

PART 743--[AMENDED]

    15. Section 743.1 is amended by removing and reserving paragraph 
(e)(2); and by revising paragraph (c)(2) (the note is unchanged), as 
follows:


Sec. 743.1  Wassenaar Arrangement.

* * * * *
    (c) * * *
    (2) Reports for ``digital computers'' and ``electronic assemblies'' 
controlled under ECCN 4A003.b and .c are required only for computers 
with a composite theoretical performance (CTP) exceeding 6,500 MTOPS or 
computer enhancements thereof such that the CTP exceeds 6,500 MTOPS. 
Records for software controlled by 4D001 are required for software 
specially designed for the development or production of computers 
having a CTP exceeding 6,500 MTOPS. For the calculation of CTP, see the 
Technical Note for Category 4 in the Commerce Control List (Supplement 
No. 2 to part 774 of the EAR).
* * * * *

[[Page 12923]]

PART 744--[AMENDED]

    16. Supplement No. 4 to part 744 is amended by revising the phrase 
``For computers between 2,000 and 7,000 MTOPS'' in the License 
requirement column for the Israeli entity ``Ben Gurion University, 
Israel'' to read ``For computers above the Tier 3 military level 
described in Sec. 742.12(b)(3)(i)(B)''.

PART 748--[AMENDED]

    17. Section 748.10 is amended by revising paragraphs (b)(3) and 
(b)(4) introductory text as follows:


Sec. 748.10  Import and End-User Certificates.

* * * * *
    (b) * * *
    (3) Your transaction involves an export to the People's Republic of 
China of a computer, you must obtain a PRC End-User Certificate, 
regardless of dollar value, as follows:
    (i) For license applications submitted on or before August 13, 
2000, a PRC End-User Certificate is required for computers with a 
Composite Theoretical Performance (CTP) greater than 6,500 Million 
Operations Per Second (MTOPS) and for license applications submitted on 
or after August 14, 2000, a PRC End-User Certificate is required for 
computers with a CTP greater than 12,500 MTOPS;
    (ii) For exports under License Exception CTP occurring on or before 
August 13, 2000, a PRC End-User Certificate is required for computers 
with a CTP of greater than 6,500 MTOPS and for such exports occurring 
on or after August 14, 2000, a PRC End-User Certificate is required for 
computers with a CTP greater than 12,500.
    (4) Your license application involves the export of commodities and 
software classified in a single entry on the CCL, the total value of 
which exceeds $5,000. Note that this $5,000 threshold does not apply to 
exports to the People's Republic of China of computers subject to the 
provisions of Sec. 748.10(b)(3).
* * * * *

PART 774--[AMENDED]

    18. In Supplement No. 1 to part 774 (the Commerce Control List), 
Category 4--Computers is amended by revising Export Control 
Classification Number (ECCN) 4A003, to read as follows:

4A003 ``Digital computers'', ``electronic assemblies'', and related 
equipment therefor, and specially designed components therefor.

License Requirements

    Reason for Control: NS, MT, CC, AT, NP, XP

 
               Control(s)                         Country chart
 
NS applies to 4A003.b and .c...........  NS Column 1.
NS applies to 4A003.a, d, .e, and .g...  NS Column 2.
MT applies to digital computers used as  MT Column 1.
 ancillary equipment for test
 facilities and equipment that are
 controlled by 9B005 or 9B006.
CC applies to digital computers for      CC Column 1.
 computerized finger-print equipment.
AT applies to entire entry (refer to     AT Column 1.
 4A994 for controls on digital
 computers with a CTP  6 but
  to 6,500 Mtops).
  NP applies to digital computers with a CTP greater than 6,500 Mtops,
  unless a License Exception is available. See Sec. 742.3(b) of the EAR
        for information on applicable licensing review policies.
  XP applies to digital computers with a CTP greater than 6,500 Mtops,
 unless a License Exception is available. XP controls vary according to
  destination and end-user and end-use. See Sec. 742.12 of the EAR for
                         additional information.
 


    Note: For all destinations, except Cuba, Iran, Iraq, Libya, 
North Korea, Sudan, and Syria, no license is required (NLR) for 
computers with a CTP greater than 6,500 Mtops, and for assemblies 
described in 4A003.c that are not capable of exceeding a CTP greater 
than 6,500 Mtops in aggregation. Computers controlled in this entry 
for MT reasons are not eligible for NLR.

    License Requirement Notes: See Sec. 743.1 of the EAR for reporting 
requirements for exports under License Exceptions.

License Exceptions

    LVS: $5000; N/A for MT and ``digital'' computers controlled by 
4A003.b and having a CTP exceeding 10,000 MTOPS; or ``electronic 
assemblies'' controlled by 4A003.c and capable of enhancing performance 
by aggregation of ``computing elements'' so that the CTP of the 
aggregation exceeds 10,000 MTOPS.
    GBS: Yes, for 4A003.d, .e, and .g and specially designed components 
therefor, exported separately or as part of a system.
    CTP: Yes, for computers controlled by 4A003.a, .b and .c, to the 
exclusion of other technical parameters, with the exception of 
parameters specified as controlled for Missile Technology (MT) concerns 
and 4A003.e (equipment performing analog-to-digital or digital-to-
analog conversions exceeding the limits of 3A001.a.5.a). See Sec. 740.7 
of the EAR.
    CIV: Yes, for 4A003.d (having a 3-D vector rate less than 75 M 
vectors/sec), .e, and .g.

List of Items Controlled

    Unit: Equipment in number; parts and accessories in $ value.
    Related Controls: See also 4A994 and 4A980.
    Related Definitions: N/A.
    Items:

    Note 1: 4A003 includes the following:
    a. Vector processors;
    b. Array processors;
    c. Digital signal processors;
    d. Logic processors;
    e. Equipment designed for ``image enhancement'';
    f. Equipment designed for ``signal processing''.


    Note 2: The control status of the ``digital computers'' and 
related equipment described in 4A003 is determined by the control 
status of other equipment or systems provided:
    a. The ``digital computers'' or related equipment are essential 
for the operation of the other equipment or systems;
    b. The ``digital computers'' or related equipment are not a 
``principal element'' of the other equipment or systems; and
    N.B. 1: The control status of ``signal processing'' or ``image 
enhancement'' equipment specially designed for other equipment with 
functions limited to those required for the other equipment is 
determined by the control status of the other equipment even if it 
exceeds the ``principal element'' criterion.
    N.B. 2: For the control status of ``digital computers'' or 
related equipment for telecommunications equipment, see Category 5, 
Part 1 (Telecommunications).
    c. The ``technology'' for the ``digital computers'' and related 
equipment is determined by 4E.

    a. Designed or modified for ``fault tolerance'';

    Note: For the purposes of 4A003.a., ``digital computers'' and 
related equipment are not considered to be designed or modified for 
``fault tolerance'' if they utilize any of the following:
    1. Error detection or correction algorithms in ``main storage'';
    2. The interconnection of two ``digital computers'' so that, if 
the active central processing unit fails, an idling but mirroring

[[Page 12924]]

central processing unit can continue the system's functioning;
    3. The interconnection of two central processing units by data 
channels or by use of shared storage to permit one central 
processing unit to perform other work until the second central 
processing unit fails, at which time the first central processing 
unit takes over in order to continue the system's functioning; or
    4. The synchronization of two central processing units by 
``software'' so that one central processing unit recognizes when the 
other central processing unit fails and recovers tasks from the 
failing unit.

    b. ``Digital computers'' having a ``composite theoretical 
performance'' (``CTP'') exceeding 6,500 million theoretical operations 
per second (Mtops);
    c. ``Electronic assemblies'' specially designed or modified to be 
capable of enhancing performance by aggregation of ``computing 
elements'' (``CEs'') so that the ``CTP'' of the aggregation exceeds the 
limit in 4A003.b.;

    Note 1: 4A003.c applies only to ``electronic assemblies'' and 
programmable interconnections not exceeding the limit in 4A003.b. 
when shipped as unintegrated ``electronic assemblies''. It does not 
apply to ``electronic assemblies'' inherently limited by nature of 
their design for use as related equipment controlled by 4A003.d, or 
4A003.e


    Note 2: 4A003.c does not control ``electronic assemblies'' 
specially designed for a product or family of products whose maximum 
configuration does not exceed the limit of 4A003.b.

    d. Graphics accelerators and graphics coprocessors exceeding a 
``three dimensional Vector Rate'' of 3,000,000;
    e. Equipment performing analog-to-digital conversions exceeding the 
limits in 3A001.a.5;
    f. Reserved.
    g. Equipment specially designed to provide external interconnection 
of ``digital computers'' or associated equipment that allows 
communications at data rates exceeding 80 Mbyte/s.

    Note: 4A003.g does not control internal interconnection 
equipment (e.g., backplanes, buses) passive interconnection 
equipment, ``network access controllers'' or ``communication channel 
controllers''.


    Dated: March 2, 2000.
Iain S. Baird,
Deputy Assistant Secretary for Export Administration.
[FR Doc. 00-5516 Filed 3-9-00; 8:45 am]
BILLING CODE 3510-33-P