[Federal Register Volume 66, Number 13 (Friday, January 19, 2001)]
[Rules and Regulations]
[Pages 5443-5447]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-1623]


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DEPARTMENT OF COMMERCE

Bureau of Export Administration

15 CFR Parts 740, 742, and 748

[Docket No. 010112014-1014-01]
RIN 0694-AC41


Implementation of Presidential Announcement of January 10, 2001: 
Revisions to License Exception CTP

AGENCY: Bureau of Export Administration, Commerce.

ACTION: Final rule.

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SUMMARY: The Bureau of Export Administration (BXA) is amending the 
Export Administration Regulations (EAR) by revising License Exception 
CTP to reflect rapid technological advances in computing capability. 
This rule implements the President's sixth revision to U.S. export 
controls on high performance computers (HPCs), announced January 10, 
2001. License Exception CTP is revised by removing Computer Tier 2 and 
merging its countries into Computer Tier 1. All HPCs continue to be 
eligible for export to a Computer Tier 1 country under License 
Exception CTP. Additionally, HPCs with CTP up to 85,000 MTOPS can be 
exported to Computer Tier 3 countries under License Exception CTP, and 
beginning March 20, 2001, exporters will no longer be required to 
submit National Defense Authorization Act (NDAA) advance notifications 
for HPCs with CTP exceeding 85,000 MTOPS. The NDAA advance notification 
will not be required for these computers, because exporters will be 
submitting a license for exports to Computer Tier 3 countries of HPCs 
with CTP exceeding 85,000 MTOPS. This rule also moves Lithuania from 
Computer Tier 3 to Computer Tier 1, effective May 19, 2001. The 
President's action will promote our national security, enhance the 
effectiveness of our export control system and ease unnecessary 
regulatory burdens on both government and industry.

DATES: This rule is effective January 19, 2001.

FOR FURTHER INFORMATION CONTACT: Tanya Hodge Mottley in the Office of 
Strategic Trade and Foreign Policy Controls, Bureau of Export 
Administration, at (202) 482-1837.

SUPPLEMENTARY INFORMATION:

Background

    On January 10, 2001, the President announced significant changes to 
U.S. 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 six months in order to reflect rapid 
advancements in computer hardware, 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 that additional adjustments are 
warranted. Effective immediately, all countries in Computer Tier 2 have 
been moved to Computer Tier 1. Computer Tier 2 has been deleted. Those 
countries formerly in Computer Tier 2 do not pose proliferation or 
security threats to the United States.
    This rule implements the Administration's decision to increase 
License Exception CTP eligibility for HPC exports to countries in 
Computer Tier 3 by raising the CTP level to 85,000 MTOPS, to reflect 
the widespread availability of computers, including high performance 
computing capability attained by clustering numerous lower level 
personal computers together.
    Effective March 20, 2001, this rule raises the advance notification 
requirement level for HPC exports to Computer Tier 3 countries from 
28,000 to 85,000 MTOPS. As required by the NDAA, changes in the advance 
notification level for HPC exports to Tier 3 destinations are only 
effective 60 days following the President's submission of a report to 
Congress. In addition, this rule revises the support documentation 
requirements for computers exported to the People's Republic of China.
    This rule removes Lithuania from Computer Tier 3 and places it in 
Computer Tier 1. However, due to the requirements in the 1998 National 
Defense Authorization Act (NDAA), removing Lithuania from Computer Tier 
3 is not effective until 120 days after the Congress receives a report 
justifying such a removal.
    This rule revises the Export Administration Regulations by 
modifying computer exports under License Exception CTP, as follows:
    1. Moving all Computer Tier 2 countries to Computer Tier 1;
    2. Raising the CTP limit for computers eligible for License 
Exception CTP for exports and reexports to Computer Tier 3 destinations 
from ``28,000 MTOPS'' to ``85,000 MTOPS'';
    3. Moving Lithuania to Tier 1 as of May 19, 2001;
    4. Revising the CTP range for which NDAA notification is required 
for computers exported or reexported to Computer Tier 3 countries;
    5. Revising the CTP level of computers for which PRC End-User 
Certificates are required as support documentation for export under 
License Exception CTP; and
    6. Revising the CTP level of the computers that require post 
shipment verification reports for exports to Computer Tier 3 countries.

Rulemaking Requirements

    1. This final rule has been determined to be not significant for 
purposes of Executive Order 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. 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 
as that

[[Page 5444]]

term is defined in 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, Department of 
Commerce, P.O. Box 273, Washington, DC 20044.

List of Subjects

15 CFR Parts 740 and 748

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

15 CFR Part 742

    Exports, Foreign trade.

    Accordingly, parts 740, 742 and 748 of the Export Administration 
Regulations (15 CFR Parts 730-799) are amended as follows:
    1. The authority citation for 15 CFR Part 740 is revised to read as 
follows:


    Authority: 50 U.S.C. app. 2401 et seq.; Pub. L. No. 106-508; 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 3, 2000 (65 FR 48347, August 8, 2000).


    2. The authority citation for 15 CFR Part 742 is revised to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; Pub. L. No. 106-508; 
Pub.L. No. 106-398; 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 10, 1999, 64 FR 
61767, 3 CFR, 1999 Comp., p. 318; Notice of August 3, 2000 (65 FR 
48347, August 8, 2000).

    3. The authority citation for part 748 is revised to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; Pub. L. No. 106-508; 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 3, 2000 (65 FR 48347, August 8, 2000).

PART 740--[AMENDED]

    4. Part 740 is amended by revising section 740.7, to read as 
follows:


Sec. 740.7  Computers (CTP).

    (a) Scope. License Exception CTP authorizes exports and reexports 
of computers and specially designed components therefor, exported or 
reexported separately or as part of a system for consumption in 
Computer Tier countries as provided by this section. (Related equipment 
controlled under 4A003.d and .g is authorized under this License 
Exception, only when exported or reexported with these computers as 
part of a system.) You may not use this License Exception to export or 
reexport items that you know will be used to enhance the CTP beyond the 
eligibility limit allowed to your country of destination. When 
evaluating your computer to determine License Exception CTP 
eligibility, use the CTP parameter to the exclusion of other technical 
parameters for computers classified under ECCN 4A003.a, .b and .c, 
except of parameters specified as Missile Technology (MT) concerns or 
4A003.e (equipment performing analog-to-digital conversions exceeding 
the limits in ECCN 3A001.a.5.a). This License Exception does not 
authorize the export or reexport of graphic accelerators or 
coprocessors, or of computers controlled for MT reasons.
    (b) Computer Tier 1. (1) Eligible countries. The countries that are 
eligible to receive exports under this License Exception include 
Antigua and Barbuda, Argentina, Australia, Austria, Bahamas, Barbados, 
Bangladesh, Belgium, Belize, Benin, Bhutan, Bolivia, Botswana, Brazil, 
Brunei, Burkina Faso, Burma, Burundi, Cameroon, Cape Verde, Central 
African Republic, Chad, Czech Republic, Chile, Colombia, Congo, Costa 
Rica, Cote d'Ivoire, Cyprus, Denmark, Dominica, Dominican Republic, 
Ecuador, El Salvador, Equatorial Guinea, Eritrea, Estonia, Ethiopia, 
Fiji, Gabon, Finland, France, Gambia (The), Germany, Ghana, Greece, 
Grenada, Guatemala, Guinea, Guinea-Bissau, Guyana, Haiti, Honduras, 
Hong Kong, Hungary, Iceland, Indonesia, Ireland, Italy, Jamaica, Japan, 
Kenya, Kiribati, Korea (Republic of), Lesotho, Liberia, Liechtenstein, 
Luxembourg, Madagascar, Malawi, Malaysia, Maldives, Mali, Malta, 
Marshall Islands, Mauritius, Mexico, Micronesia (Federated States of), 
Monaco, Mozambique, Namibia, Nauru, Nepal, Netherlands, New Zealand, 
Nicaragua, Niger, Nigeria, Norway, Palau, Panama, Papua New Guinea, 
Paraguay, Peru, Philippines, Poland, Portugal, Romania, Rwanda, St. 
Kitts & Nevis, St. Lucia, St. Vincent and Grenadines, Sao Tome & 
Principe, San Marino, Senegal, Seychelles, Sierra Leone, Singapore, 
Slovakia, Slovenia, Solomon Islands, Somalia, South Africa, Spain, Sri 
Lanka, Surinam, Swaziland, Sweden, Switzerland, Taiwan, Tanzania, Togo, 
Tonga, Thailand, Trinidad and Tobago, Turkey, Tuvalu, Uganda, United 
Kingdom, Uruguay, Vatican City, Venezuela, Western Sahara, Western 
Samoa, Zaire, Zambia, and Zimbabwe. As of May 19, 2001, Lithuania is a 
Computer Tier 1 country.
    (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) [Reserved]
    (d) Computer Tier 3. (1) Eligible countries. The countries that are 
eligible to receive exports and reexports under this License Exception 
are Afghanistan, Albania, Algeria, Andorra, Angola, Armenia, 
Azerbaijan, Bahrain, Belarus, Bosnia & Herzegovina, Bulgaria, Cambodia, 
China (People's Republic of), Comoros, Croatia, Djibouti, Egypt, 
Georgia, India, Israel, Jordan, Kazakhstan, Kosovo (Serbian province 
of), Kuwait, Kyrgyzstan, Laos, Latvia, Lebanon, Lithuania, Macau, 
Macedonia (The Former Yugoslav Republic of), Mauritania, Moldova, 
Mongolia, Montenegro, Morocco, Oman, Pakistan, Qatar, Russia, Saudi 
Arabia, Serbia, Tajikistan, Tunisia, Turkmenistan, Ukraine, United Arab 
Emirates, Uzbekistan, Vanuatu, Vietnam, and Yemen. As of May 19, 2001, 
Lithuania is moved to Computer Tier 1.
    (2) Eligible computers. The computers eligible for License 
Exception CTP to Tier 3 destinations are those having a CTP greater 
than 6,500 MTOPS, but less than or equal to 85,000 MTOPS, subject to 
the restrictions in paragraph (d)(3) of this section.
    (3) Eligible exports. Only exports and reexports to permitted end-
users and end-uses located in countries in Computer Tier 3. License 
Exception CTP does not authorize exports and reexports to Computer Tier 
3 for nuclear, chemical, biological, or missile end-users and end-uses 
and military

[[Page 5445]]

end-users and end-uses subject to license requirements under 
Sec. 744.2, Sec. 744.3, Sec. 744.4, Sec. 744.5, and Sec. 744.12 of the 
EAR. Such exports and reexports will continue to require a license and 
will be considered on a case-by-case basis. Retransfers to these end-
users and end-uses in eligible countries are strictly prohibited 
without prior authorization.
    (4) Supporting documentation. Exporters are required to obtain a 
People's Republic of China (PRC) End-User Certificate before exporting 
computers described by paragraph (d)(2) of this section to the PRC, 
regardless of value. (See Sec. 748.10(b)(3) of the EAR for information 
on obtaining the PRC End-User Certificate.) Exporters are required to 
provide the PRC End-User Certificate Number to BXA as part of their 
post-shipment report (see paragraph (d)(5)(v) of this section). When 
providing the PRC End-User Certificate Number to BXA, you must identify 
the transaction in the post shipment report to which that PRC End-User 
Certificate Number applies. The original PRC End-User Certificate shall 
be retained in the exporter's files in accordance with the 
recordkeeping provisions of Sec. 762.2 of the EAR.
    (5) NDAA notification. (i) General requirement and procedures. The 
National Defense Authorization Act (NDAA) of FY98 (Public Law 105-85, 
111 Stat. 1629), enacted on November 18, 1997 requires advance 
notification of certain exports and reexports of computers to Computer 
Tier 3 countries. 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 
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.) BXA will not initiate the registration of an NDAA notice 
unless all information on the Multipurpose Application form is 
complete.
    (A) Prior to February 26, 2001, advance notification is required 
for all exports and reexports of computers with a CTP greater than 
12,500 but less than or equal to 85,000 MTOPS to Computer Tier 3 
destinations. You must also provide a notice using this procedure prior 
to exporting or reexporting items that you know will be used to enhance 
the CTP of a previously exported or reexported computer beyond 12,500 
MTOPS, but less than or equal to 85,000 MTOPS.
    (B) Beginning on February 26, 2001 but prior to March 20, 2001, 
advanced notification is required for export and reexport of computers 
with a CTP greater than 28,000 MTOPS, but less than or equal to 85,000 
MTOPS to Computer Tier 3 destinations. You must also provide a notice 
using this procedure prior to exporting or reexporting items that you 
know will be used to enhance the CTP of a previously exported or 
reexported computer beyond 28,000 MTOPS, but less than or equal to 
85,000 MTOPS.
    (ii) Action by BXA. Within 24 hours of the registration of the NDAA 
notice, BXA will refer the notice for interagency review. Registration 
is defined as the point at which the notice is entered into BXA's 
electronic system.
    (iii) Review by other departments or agencies. The Departments of 
Defense, Energy, and State have the authority to review the NDAA 
notice. Objections by any department or agency must be received by the 
Secretary of Commerce within nine days of the referral. Unlike the 
provisions described in Sec. 750.4(b) of the EAR, there are no 
provisions for stopping the processing time of the NDAA notice. If, 
within 10 days after the date of registration, any reviewing agency 
provides a written objection to the export or reexport of a computer, 
License Exception CTP may not be used. In such cases, you will be 
notified that a license is required for the export or reexport. The 
NDAA notice will then be processed by BXA as a license application in 
accordance to the provisions described in Sec. 750.4 of the EAR, and 
the licensing policies set forth in the Export Administration 
Regulations. Its NDAA notice number will be changed to a license 
application number. BXA may at this time request additional information 
to properly review the license application. If BXA confirms that no 
objection has been raised within the 10-day period (as described in 
paragraph (d)(5)(iv) of this section), you may proceed with the 
transaction on the eleventh day following date of registration. (Note 
that the fact that you have been advised to proceed with the 
transaction does not exempt you from other licensing requirements under 
the EAR, such as those based on knowledge of a prohibited end-use or 
end-user as referenced in general prohibition five (part 736 of the 
EAR) and set forth in part 744 of the EAR.)
    (iv) Status of pending advance notification requests. You must 
contact BXA's System for Tracking Export License Applications 
(``STELA'') at (202) 482-2752. (See Sec. 750.5 of the EAR for 
procedures to access information on STELA.) STELA will provide the date 
of registration of the NDAA notice. If no departments or agencies raise 
objections within the 10-day period, STELA will provide you on the 
eleventh day following date of registration with confirmation that no 
objections have been raised and you may proceed with the transaction. 
BXA will subsequently issue written confirmation to you. If a license 
is required, STELA will notify you that an objection has been raised 
and a license is required. The NDAA notice will be processed as a 
license application. In addition, BXA may provide notice of an 
objection by telephone, fax, courier service, or other means.
    (v) Post-shipment verification. This section outlines special post-
shipment reporting requirements for exporters of certain computers to 
destinations in Computer Tier 3. 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) 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:
    (1) For exports occurring prior to February 26, 2001, where the CTP 
is greater than 12,500 MTOPS; and
    (2) For exports on or after February 26, 2001, but prior to March 
20, 2001, where the CTP is greater than 28,000 MTOPS.
    (B) Information that must be included in each post-shipment report. 
No later than the last day of the month following the month in which 
the export takes place, the exporter must submit the following 
information to BXA at the address listed in paragraph (d)(5)(v)(C) of 
this section:
    (1) Exporter name, address, and telephone number;
    (2) NDAA notification number;
    (3) Date of export;
    (4) End-user name, point of contact, address, telephone number;
    (5) Carrier;
    (6) Air waybill or bill of lading number;
    (7) Commodity description, quantities--listed by model numbers, 
serial numbers, and CTP level in MTOPS; and

[[Page 5446]]

    (8) Certification line for exporters to sign and date. The exporter 
must certify that the information contained in the report is accurate 
to the best of his or her knowledge.

    Note to paragraph (d)(5)(v)(B) of this section: For exports 
authorized under License Exception CTP to the People's Republic of 
China (PRC), you must submit the PRC End-User Certificate Number 
identifying the transaction for which the End-User Certificate 
Number applies.

    (C) Mailing address. A copy of the post-shipment report[s] required 
under paragraph (d)(5)(v) of this section shall be delivered to one of 
the following addresses. Note that BXA will not accept reports sent 
C.O.D.

(1) For deliveries by U.S. postal service: U.S. Department of Commerce, 
Bureau of Export Administration, P.O. Box 273, Washington, D.C. 20044, 
Attn: Office of Enforcement Analysis HPC Team, Room 4065.
(2) For courier deliveries: U.S. Department of Commerce, Office of 
Enforcement Analysis HPC Team, 14th Street and Constitution Ave., NW, 
Room 4065, Washington, DC 20230.

    (e) Restrictions. (1) Access by certain foreign nationals. 
Computers eligible for License Exception CTP may not be accessed either 
physically or computationally by nationals of Cuba, Iran, Iraq, Libya, 
North Korea, Sudan or Syria, except commercial consignees described in 
Supplement No. 3 to part 742 of the EAR are prohibited only from giving 
such nationals user-accessible programmability.
    (2) Reexport and retransfers. Computers eligible for License 
Exception CTP may not be reexported/retransferred without prior 
authorization from BXA i.e., a license, a permissive reexport, another 
License Exception, or ``No License Required''. This restriction must be 
conveyed to the consignee, via the Destination Control Statement, see 
Sec. 758.6 of the EAR. Additionally, the end-use and end-user 
restrictions in paragraph (d)(3) of this section must be conveyed to 
any consignee in Computer Tier 3.
    (f) Reporting requirements. In addition to the reporting 
requirements set forth in paragraph (d) of this section, see Sec. 743.1 
of the EAR for additional reporting requirements of certain items under 
License Exception CTP.

PART 742--[AMENDED]

    5. Section 742.12 is amended by removing the second sentence in 
paragraph (d); revising paragraph (a); removing and reserving paragraph 
(b)(2); and revising paragraph (b)(3) to read as follows:


Sec. 742.12  High performance computers.

    (a) License and recordkeeping requirements. (1) This section 
contains special provisions for exports, reexports, and certain intra-
country transfers of high performance computers, including software, 
and technology. This section affects the following ECCNs: 4A001; 4A002; 
4A003; 4D001; 4D002; and 4E001. Licenses are required under this 
section for ECCN's having an ``XP'' under ``Reason for Control'' when 
License Exception CTP is not available (see Sec. 740.7 of the EAR). 
License requirements reflected in this section are based on particular 
destinations, end-users, or end-uses. For the calculation of CTP, see 
the Technical Note that follows the Advisory Notes for Category 4 in 
the Commerce Control List. Note that License Exception CTP contains 
restrictions on access by nationals of certain countries, and on 
reexports and transfers of computers.
    (2) In recognition of the strategic and proliferation significance 
of high performance computers, a license is required for the export or 
reexport of high performance computers to destinations, end-users, and 
end-uses, as specified in this section and on the CCL. These license 
requirements supplement requirements that apply for other control 
reasons, such as nuclear nonproliferation provided in section 742.3 of 
the EAR. The license requirements described in this section 742.12 are 
not reflected on the Country Chart (Supplement No. 1 to part 738 of the 
EAR). Three Computer Country Tiers have been established for the 
purposes of these controls. Countries included in Computer Tiers 1 and 
3 are listed in License Exception CTP in section 740.7 of the EAR. As 
of January 19, 2001 there is no longer a Computer Tier 2, and countries 
that were in Tier 2 are incorporated into Computer Tier 1. Computer 
Tier 4 consists of Cuba, Iran, Iraq, Libya, North Korea, Sudan, and 
Syria.
    (3) Exporters must keep accurate records of each export to 
countries not included in Country Group A:1 (see Supplement No. 1 to 
part 740 of the EAR) of a computer with a CTP greater than 6,500 MTOPS. 
These records must be submitted semiannually to BXA and must contain 
the information as described in Sec. 743.1 of the EAR.
    (b) * * *
    (1) * * *
    (2) [Reserved]
    (3) Computer Tier 3. (i) License requirement. (A) A license is 
required to export or reexport computers to countries in Computer Tier 
3 to nuclear, chemical, biological, or missile end-users and end-uses 
and military end-users and end-uses subject to license requirements 
under Sec. 744.2, Sec. 744.3, Sec. 744.4, Sec. 744.5, and Sec. 744.12 
of the EAR in Computer Tier 3 countries.
    (B) A license is required to export or reexport computers with a 
CTP greater than 85,000 MTOPS to a country in Computer Tier 3.
    (C) Prior to February 26, 2001, 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). Beginning on February 26, 2001 but prior to March 20, 2001, a 
license may be required to export or reexport computers with a CTP 
greater than 28,000 MTOPS but less than or equal to 85,000 MTOPS to 
countries in Computer Tier 3 pursuant to the NDAA.
    (ii) Licensing policy for nuclear, chemical, biological, or missile 
end-users and end-uses and military end-users and end-uses. License 
applications for exports and reexports to nuclear, chemical, 
biological, or missile end-users and end-uses and military end-users 
and end-uses subject to license requirements under Sec. 744.2, 
Sec. 744.3, Sec. 744.4, Sec. 744.5, and Sec. 744.12 of the EAR in 
countries in Computer Tier 3 will be reviewed on a case-by-case basis 
using the following criteria:
    (A) The presence and activities of countries and end-users of 
national security and proliferation concern and the relationships that 
exist between the government of the importing country and such 
countries and end-users;
    (B) The ultimate consignee's participation in, or support of, any 
of the following:
    (1) Activities that involve national security concerns; or
    (2) Nuclear, chemical, biological or missile proliferation 
activities described in part 744 of the EAR;
    (C) The extent to which the importing country is involved in 
nuclear, chemical, biological, or missile proliferation activities 
described in part 744 of the EAR;
    (D) The end-user, whether the end-use is single-purpose or 
multiple-purpose.
    (iii) Licensing policy for other end-users and end-uses. License 
applications for exports and reexports to other end-uses and end-users 
located in Computer Tier 3 countries will generally be approved, except 
there is a presumption of denial for all applications for exports and 
reexports of computers having a CTP greater than 6,500 MTOPS destined 
to Indian and Pakistani entities determined to be

[[Page 5447]]

involved in nuclear, missile, or military activities included in 
Supplement No. 4 to part 744 (Entity List). All license applications 
for exports and reexports to India and Pakistan not meeting these 
criteria for presumption of denial will be considered on a case-by-case 
basis under other licensing policies set forth in the EAR applicable to 
such computers.
    (iv) Post-shipment verification. This section outlines special 
post-shipment reporting requirements for exporters of certain computers 
to destinations in Computer Tier 3. 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) 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:
    (1) For exports occurring prior to February 26, 2001, where the CTP 
is greater than 12,500 MTOPS;
    (2) For exports on or after February 26, 2001, but before March 20, 
2001 where the CTP is greater than 28,000 MTOPS; and
    (3) For exports on or after March 20, 2001 where the CTP is greater 
than 85,000 MTOPS.
    (B) Information that must be included in each post-shipment report. 
No later than the last day of the month following the month in which 
the export takes place, the exporter must submit the following 
information to BXA at the address listed in paragraph (b)(3)(iv)(C) of 
this section:
    (1) Exporter name, address, and telephone number;
    (2) License number;
    (3) Date of export;
    (4) End-user name, point of contact, address, telephone number;
    (5) Carrier;
    (6) Air waybill or bill of lading number;
    (7) Commodity description, quantities--listed by model numbers, 
serial numbers, and CTP level in MTOPS; and
    (8) Certification line for exporters to sign and date. The exporter 
must certify that the information contained in the report is accurate 
to the best of his or her knowledge.
    (C) Mailing address. A copy of the post-shipment report[s] required 
under paragraph (b)(3)(iv)(A) of this section shall be delivered to one 
of the following addresses. Note that BXA will not accept reports sent 
C.O.D.

(1) For deliveries by U.S. postal service: U.S. Department of Commerce, 
Bureau of Export Administration, P.O. Box 273, Washington, D.C. 20044, 
Attn: Office of Enforcement Analysis HPC Team, Room 4065.
(2) For courier deliveries: U.S. Department of Commerce, Office of 
Enforcement Analysis HPC Team, 14th Street and Constitution Ave., NW, 
Room 4065, Washington, DC 20230.
* * * * *

PART 748--[AMENDED]

    6. Section 748.10 is amended by revising paragraph (b)(3) as 
follows:


Sec. 748.10  Import and end-user certificates.

* * * * *
    (b) * * *
    (3) Your transaction involves an export to the People's Republic of 
China (PRC) of a computer. You must obtain a PRC End-User Certificate, 
regardless of dollar value, as follows:
    (i) For exports of computers as described by Sec. 740.7(d)(2) of 
the EAR, regardless of value, to the People's Republic of China. (See 
paragraph (c) of this section for information on obtaining the PRC End-
User Certificate.) Exporters are required to obtain a PRC End-User 
Certificate before exporting computers to the PRC. In addition, 
exporters are required to provide the PRC End-User Certificate Number 
to BXA as part of their post-shipment report (see Sec. 740.7(d)(5)(v) 
of the EAR). When providing the PRC End-User Certificate Number to BXA, 
you must identify the transaction in the post shipment report to which 
that PRC End-User Certificate Number applies. The original PRC End-User 
Certificate shall be retained in the exporter's files in accordance 
with the recordkeeping provisions of Sec. 762.2 of the EAR.
    (ii) For exports of computers that require license applications.
* * * * *

    Dated: January 16, 2001.
Matthew S. Borman,
Acting Deputy Assistant Secretary for Export Administration.
[FR Doc. 01-1623 Filed 1-16-01; 4:49 pm]
BILLING CODE 3510-33-P