[Federal Register Volume 67, Number 46 (Friday, March 8, 2002)]
[Rules and Regulations]
[Pages 10611-10617]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-5563]


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DEPARTMENT OF COMMERCE

Bureau of Export Administration

15 CFR parts 734, 738, 740, 742, 743, 748, and 774

[Docket No. 020228044-2044-01]
RIN 0694-AC42


Implementation of the Wassenaar Arrangement List of Dual-Use 
Items Revisions: Computers; and 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) maintains the 
Commerce Control List (CCL), which identifies those items subject to 
Department of Commerce export licensing requirements based on their 
characteristics. Certain entries on the CCL implement multilateral 
national security controls established by the Wassenaar Arrangement on 
Export controls for Conventional Arms and Dual-Use Goods (the Wassenaar 
Arrangement), of which the United States is a founding member. The 
Wassenaar Arrangement controls strategic items with the objective of 
improving regional and international security and stability.
    In this regard, on December 1, 2000, the Wassenaar Arrangement 
agreed to implement several changes in its List of Dual-Use Goods and 
Technologies. This final rule revises the CCL to implement certain 
agreed changes in Category 4 (Computers) of the Wassenaar List of Dual-
Use Goods and Technologies, specifically in the area of computers. 
These changes are being implemented to reflect rapid technological 
advances and effective control factors. Additional changes in other 
categories of the Wassenaar Dual-Use List will be implemented in the 
CCL in a supplemental regulation.
    In addition, this rule makes conforming and clarification revisions 
to License Exception CTP.

DATES: This rule is effective March 5, 2002.

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

    In July 1996, the United States and thirty-two other countries gave 
final approval to the establishment of a new multilateral export 
control regime, called the Wassenaar Arrangement on Export Controls for 
Conventional Arms and Dual-Use Goods and Technologies (Wassenaar 
Arrangement). The Wassenaar Arrangement contributes to regional and 
international security and stability by promoting transparency and 
greater responsibility in transfers of conventional arms and dual-use 
goods and technologies, thus preventing destabilizing accumulations of 
such items. Participating states have committed to exchange information 
on exports of dual-use goods and technologies to non-participating 
states for the purposes of enhancing transparency and assisting in the 
development of a common understanding of the risks associated with the 
transfers of these items.

Implementation of Wassenaar Arrangement Agreement

    This final rule revises certain national security control 
parameters for computers to implement recently agreed changes in 
Category 4 (Computers) of the Wassenaar List of Dual-Use Goods and 
Technologies. These changes are being implemented to reflect rapid 
technological advances and controllability factors.
    A detailed description of the amendments to the Commerce Control 
List that are included in this rule is provided below.

Category 4--Computers:

    4A001--Amended by:
    (1) Revising the License Requirement section to increase the XP 
control levels from 6,500 MTOPS to 28,000 MTOPS, consistent with the 
multilaterally agreed national security level; and
    (2) Correcting some typographical errors in the Related Control 
section.
    4A002--Amended by revising the License Requirement section to 
increase

[[Page 10612]]

the XP control levels from 6,500 MTOPS to 28,000 MTOPS, consistent with 
the multilaterally agreed national security level.
    4A003--Amended by:
    (1) Revising the License Requirement section to increase the XP 
control levels from 6,500 MTOPS to 28,000 MTOPS, consistent with the 
multilaterally agreed national security level;
    (2) Removing License Exception LVS eligibility for paragraphs (b) 
and (c), as the need for LVS MTOPS limit has been surpassed by the new, 
higher control threshold and BXA has determined that an eligibility 
level above the new threshold is not warranted; and
    (3) Revising paragraph (b) in the List of Items Controlled to 
increase the national security (NS) control level for computers from 
6,500 MTOPS to 28,000 MTOPS.
    4D001--Amended by revising the License Requirement section to 
increase the XP control levels from 6,500 MTOPS to 28,000 MTOPS, 
consistent with the multilaterally agreed national security level.
    4D002--Amended by:
    (1) Revising the License Requirement section to increase the XP 
control levels from 6,500 MTOPS to 28,000 MTOPS, consistent with the 
multilaterally agreed national security level; and
    (2) Correcting a citation reference in the XP reason for control 
paragraph.
    4E001--Amended by revising the License Requirement section to 
increase the XP control levels from 6,500 MTOPS to 28,000 MTOPS, 
consistent with the multilaterally agreed national security level.
    This rule also revises other provisions of the EAR to ensure that 
all regulations reflect the changes made by Wassenaar Arrangement 
Agreement. This rule raises the CTP level for which Wassenaar reporting 
is required for computers exported to non-Wassenaar members under 
License Exception from 6,500 MTOPS to 75,000 MTOPS. Wassenaar reporting 
requirements are found in part 743 of the EAR. Reports for exports to 
Computer Tier 3 destinations of computers having a CTP level of greater 
than 85,000 MTOPS, should be reported under the post shipment 
verification reporting provisions of Sec. 742.12 and need not be 
reported under the Wassenaar reporting provisions in section Sec. 743.1 
of the EAR.
    This rule also raises the CTP limit from 33,000 MTOPS to 85,000 
MTOPS of computers and electronic assemblies that are eligible for 
export or reexport under License Exception GOV to the International 
Atomic Energy Agency (IAEA) and the European Atomic Energy Community 
(Eurotom), and reexports by these organizations for official 
international safeguard use, as described in Sec. 740.11(a) of the EAR.
    Finally, this rule raises the CTP limit from 33,000 MTOPS to 85,000 
MTOPS of computers and electronic assemblies that are eligible for 
export or reexport under License Exception GOV for international 
inspections under the Chemical Weapons Convention, while adding a 
prohibition for access either physically or computationally by 
nationals of Cuba, Iran, Iraq, Libya, North Korea, Sudan, or Syria.
    This rule also clarifies that the XP (high performance computer) 
reason for control in ECCNs 4A001, 4A002, 4A003, 4D001, 4D002, and 
4E001, does not apply to Canada. In 1996, BXA published a regulation 
that restructured the entire Export Administration Regulations (61 FR 
12714, March 25, 1996). Prior to the restructuring, Sec. 785.6 of the 
EAR stated that, ``the general policy is to permit shipments of 
commodities and technical data to Canada for consumption or use in that 
country without an export license.'' Because XP is not a reason for 
control that is represented on the Commerce Country Chart created by 
the restructuring, and because the general policy statement for Canada 
was removed from the EAR during the restructuring, the EAR did not 
clearly state that a license is not required for items controlled under 
XP when destined to Canada. Therefore, this rule corrects this 
unintentional omission, by incorporating language into the CCL stating 
that XP does not apply to Canada.
    This rule also corrects the license requirement for XP reasons, set 
forth in Sec. 742.12(a)(1), to state that the XP license requirement 
does not apply when an item is eligible for export or reexport under 
any License Exception. This rule also clarifies, in Sec. 742.12(a)(1), 
that post-shipment verification reporting or Wassenaar reporting 
requirements may apply to certain exports or reexports of XP controlled 
items under License Exceptions.

Revisions to License Exception CTP

    In addition, this rule clarifies License Exception CTP and removes 
some provisions that have been unintentionally retained in the EAR when 
BXA published the rule that implemented President Clinton's January 10, 
2001 announcement on computer revisions, on January 19, 2001 (66 FR 
5443).
    This rule makes the following specific amendments to License 
Exception CTP (Sec. 740.7 of the EAR):
    (1) Clarifies the scope of the License Exception, by adding 
language explaining that the scope not only covers computers and 
specially designed components therefor, but also includes electronic 
assemblies;
    (2) Moves the restrictions found in paragraph (a) ``scope'' to a 
new paragraph (b) ``restrictions'';
    (3) Removes the reference to the national security control level 
for high performance computers (greater than 6,500 MTOPS) eligible 
under this License Exception for export or reexport to countries in 
Computer Tiers 1 or 3. This revision was added to this rule to clarify 
that computers having a CTP less than 28,000 MTOPS, that are controlled 
for parameters other than CTP, are eligible under this License 
Exception; and
    (4) Removing paragraphs (d)(4) and (d)(5), because NDAA 
notification requirements and post-shipment verification reporting 
requirements are no longer required for computers that are eligible for 
License Exception CTP. The regulation that was published on January 19, 
2001 (66 FR 5443) established that NDAA notification and post-shipment 
requirements under License Exception CTP would end on March 20, 2001. 
However, provisions in Sec. 742.12(b)(3)(iv) of the EAR continue to 
require post-shipment verification reporting for licensed exports and 
reexports of computers above 85,000 MTOPS, and for licensed exports of 
items used to enhance previously exported or reexported computers, 
where the CTP is greater than 85,000 MTOPS. In addition, this rule 
makes the following clarifications and corrections in other provisions 
of the EAR to ensure that all regulations reflect the changes made by 
the President's January 10, 2001 announcement.
    (1) As the January 19, 2001 rule moved Hong Kong and South Korea to 
Computer Tier 1 with eligibility under License Exception CTP for 
computers with unlimited CTP, this rule removes footnote number 2 from 
the Commerce Country Chart (Supplement No. 1 to part 738), which 
imposed a license requirement for computers with a CTP greater than 
45,000 MTOPS to Hong Kong and South Korea. The ``X'' in NS Column 2 for 
Hong Kong and South Korea only represented a license requirement for 
items under 4A001, 4A002, and 4A003 if the CTP was greater than 45,000 
MTOPS, and did not apply for any other items subject to NS Column 2; 
therefor, the license requirement symbol ``X'' from NS Column 2 has 
been removed for these countries.

[[Page 10613]]

    (2) This rule revises Sec. 740.16(b)(1) to remove from License 
Exception APR the restriction on reexports of computers with a CTP 
greater than 45,000 MTOPS to Hong Kong and South Korea.
    (3) This rule also raises the CTP limit from 28,000 MTOPS to 85,000 
MTOPS for computers containing U.S.-origin controlled semiconductors 
(other than memory circuits) classified under ECCN 3A001 that are 
eligible for becoming ``not subject to the EAR'' under the de minimis 
procedures of Sec. 734.4 of the EAR when destined to Computer Tier 3, 
while keeping the limit at 28,000 MTOPS for computers containing U.S.-
origin controlled semiconductors (other than memory circuits) 
classified under ECCN 3A001 or high speed interconnect devices (ECCN 
4A994.j) when destined to Computer Tier 4 countries.
    Although the Export Administration Act expired on August 20, 2001, 
Executive Order 13222 of August 17, 2001 (66 FR 44025, August 22, 2001) 
continues the Regulations in effect under the International Emergency 
Economic Powers Act.

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 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 Part 734

    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 Parts 738 and 742

    Exports, Foreign trade.

15 CFR Part 774

    Exports, Foreign trade, Reporting and recordkeeping requirements.


    Accordingly, parts 734, 738, 740, 742, 743, 748, and 774 of the 
Export Administration Regulations (15 CFR Parts 730-799) are amended as 
follows:
    1. The authority citation for 15 CFR Part 734 is revised to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
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; E.O. 13222, 66 FR 44025, August 22, 2001; Notice 
of November 9, 2001, 66 FR 56965, November 13, 2001.


    2. The authority citation for 15 CFR part 738 is revised to read 
and the authority citation for 15 CFR 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; Sec. 901-911, Publ. L. 106-387; Sec. 
221, Publ. L. 107-56; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 
228; E.O. 13222, 66 FR 44025, August 22, 2001.


    3. The authority citation for 15 CFR part 740 is revised to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
Sec. 901-911, Publ. L. 106-387; E.O. 13026, 61 FR 58767, 3 CFR, 1996 
Comp., p. 228; E.O. 13222, 66 FR 44025, August 22, 2001.


    4. The authority citation for 15 CFR part 748 is revised to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 
FR 44025, August 22, 2001.


    5. The authority citation for 15 CFR Part 742 is revised 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; 
Sec. 901-911, Publ. L. 106-387; Sec. 221, Publ. L. 107-56; 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. 12938, 59 FR 59099, 3 CFR, 
1994 Comp., p. 950; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 
228; E.O. 13222, 66 FR 44025, August 22, 2001; Notice of November 9, 
2001, 66 FR 56965, November 13, 2001.


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

    Authority: 50 U.S.C. app. 2401 et seq; Pub.L. 106-508; 50 U.S.C. 
1701 et seq; E.O. 13206, 66 FR 18397, April 9, 2001.

PART 734--[AMENDED]

    7. Part 734 is amended by revising Sec. 734.4(a), to read as 
follows:


Sec. 734.4  De Minimis U.S. Content.

    (a) There is no de minimis level for the export from a foreign 
country of a foreign-made computer exceeding 85,000 MTOPS containing 
U.S.-origin controlled semiconductors (other than memory circuits) 
classified under ECCN 3A001 to Computer Tier 3; or exceeding 28,000 
MTOPS containing U.S.-origin controlled semiconductors (other than 
memory circuits) classified under ECCN 3A001 or high speed interconnect 
devices (ECCN 4A994.j) to Computer Tier 4 countries described in 
Sec. 742.12 of the EAR.
* * * * *

PART 738--[AMENDED]

    8. Supplement No. 1 to part 738 is amended by:
    (a) Removing the license symbol ``X'' and the reference to footnote 
2 in NS

[[Page 10614]]

Column 2 for Hong Kong and South Korea; and
    (b) Removing footnote 2.

PART 740--[AMENDED]

    9. Part 740 is amended by:
    (a) Revising Secs. 740.7, 740.11(c)(2)(i) and 740.16(b); and
    (b) Revising the number ``45,000'' to read ``85,000'' in 
740.11(a)(2)(ii), 740.11(a)(2)(iii), Supplement No. 1 to Sec. 740.11 
paragraphs (a)(1)(ii), (a)(1)(iii), (b)(1)(ii), and (b)(1)(iii), to 
read as follows:


Sec. 740.7  COMPUTERS (CTP).

    (a) Scope. License Exception CTP authorizes exports and reexports 
of computers, including ``electronic assemblies'' and specially 
designed components therefor controlled by ECCN 4A003, exported or 
reexported separately or as part of a system for consumption in 
Computer Tier countries as provided by this section. 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 or .b, and ``electronic 
assemblies'' under ECCN 4A003.c, except for 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).
    (b) Restrictions. (1) Related equipment controlled under 4A003.d 
and .g may not be exported or reexported under this License Exception 
when exported or reexported separately from eligible computers 
authorized under this License Exception.
    (2) 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 that commercial 
consignees described in Supplement No. 3 to part 742 of the EAR are 
prohibited only from giving such nationals user-accessible 
programmability.
    (3) Computers eligible for License Exception CTP may not be 
reexported or 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.
    (4) 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.
    (c) 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, 
Lithuania, 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.
    (2) Eligible commodities. All computers, including electronic 
assemblies and specially designed components therefor are eligible for 
License Exception CTP to Tier 1 destinations, subject to the 
restrictions in paragraph (b) of this section.
    (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, Kuwait, Kyrgyzstan, Laos, 
Latvia, Lebanon, Macau, Macedonia (The Former Yugoslav Republic of), 
Mauritania, Moldova, Mongolia, Morocco, Oman, Pakistan, Qatar, Russia, 
Saudi Arabia, Tajikistan, Tunisia, Turkmenistan, Ukraine, United Arab 
Emirates, Uzbekistan, Vanuatu, Vietnam, Yemen, and Federal Republic of 
Yugoslavia (Serbia and Montenegro).
    (2) Eligible commodities. All computers, including electronic 
assemblies and specially designed components therefor having a CTP less 
than or equal to 85,000 MTOPS are eligible for License Exception CTP to 
Tier 3 destinations, subject to the restrictions in paragraphs (b) and 
(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 
subject to license requirements under Sec. 744.2, Sec. 744.3, 
Sec. 744.4, and Sec. 744.5 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.
    (e) Reporting requirements. See Sec. 743.1 of the EAR for reporting 
requirements of certain items under License Exception CTP.


Sec. 740.11  Governments, international organizations, and 
international inspections under the Chemical Weapons Convention (GOV).

* * * * *
    (c) * * *
    (2) * * *
    (i) Computers with a Composite Theoretical Performance (CTP) 
greater than 85,000 MTOPS. In addition, computers eligible for this 
provision of License Exception GOV may not be accessed either 
physically or computationally by nationals of Cuba, Iran, Iraq, Libya, 
North Korea, Sudan, or Syria. No MTOPS limit applies to exports or 
reexports to countries in Tier 1 (see Sec. 740.7(b)(1) of the EAR).
* * * * *


Sec. 740.16  Additional Permissive Reexports (APR).

* * * * *
    (b) Reexports to and among Country Group A:1 and cooperating 
countries. Reexports may be made to and among Country Group A:1 and 
cooperating countries, provided that eligible commodities are for use 
or consumption within a Country Group A:1 (see Supplement No. 1 to part 
740) or cooperating country, or for reexport

[[Page 10615]]

from such country in accordance with other provisions of the EAR. All 
commodities are eligible except those controlled for nuclear 
nonproliferation reasons or missile technology reasons.
* * * * *

PART 742--[AMENDED]

    10. Section 742.12 is amended by:
    (a) Revising paragraph (a)(1);
    (b) Revising paragraph (a)(3);
    (c) Removing paragraph (b)(3)(i)(C);
    (d) Adding a note to paragraph (b)(3)(i);
    (e) Revising the phrase ``computers having a CTP greater than 6,500 
MTOPS destined to'' to read ``high performance computers destined to'' 
in paragraph (b)(3)(iii);
    (f) Revising paragraphs (b)(3)(iv)(A); and
    (g) Adding a note to paragraph (b)(3)(iv)(B), 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'', 
unless a License Exception is available (see part 740 of the EAR). 
Post-shipment verification reporting or Wassenaar reporting may be 
required when exporting or reexporting ``XP'' items under the 
authorization of a License Exception (See 743.1 of the EAR for 
Wassenaar reporting requirements and paragraph (b)(3)(iv) of this 
section for post-shipment verification requirements). 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 list of ECCNs 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.
* * * * *
    (3) Exporters must keep accurate records of each export to non-
Wassenaar member countries (see Supplement No. 1 to part 743 of the 
EAR) of a computer with a CTP greater than 75,000 MTOPS. These records 
must be submitted semiannually to BXA and must contain the information 
as described in Sec. 743.1 of the EAR.
    (b) Licensing policy. * * *
    (3) Computer Tier 3. * * *
    (i) * * *


    Note to Paragraph (b)(3)(i) of This Section: Exporters are 
required to obtain a People's Republic of China (PRC) End-User 
Certificate before exporting computers described by paragraph 
(b)(3)(i) of this section to the PRC, regardless of value. (See 
Sec. 748.10(c)(3) of the EAR for information on obtaining the PRC 
End-User Certificate.)


    (iv) Post-shipment verification. * * *
    (A) Exporters must file post-shipment reports for high performance 
computer exports, as well as exports of items used to enhance 
previously exported or reexported computers, where the CTP is greater 
than 85,000 MTOPS.
    (B) * * *

    Note to Paragraph (b)(3)(iv)(B) of This Section: Exporters are 
required to provide the PRC End-User Certificate Number to BXA as 
part of their post-shipment report (see paragraph (b)(3)(iv) 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.

* * * * *

PART 743--[AMENDED]

    11. Section 743.1 is amended by revising paragraph (c)(2) and, the 
note to paragraph (c)(2) and adding paragraph (e)(2) to read as 
follows:


Sec. 743.1  Wassenaar Arrangement.

* * * * *
    (c) Items for which reports are required. * * *
    (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 75,000 MTOPS 
or computer enhancements thereof such that the CTP of the aggregation 
exceeds 75,000 MTOPS. Records for software controlled by 4D001 are 
required for software specially designed for the development or 
production of computers having a CTP exceeding 75,000 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).

    Note to Paragraph (c)(2): Reports for exports to Computer Tier 3 
destinations (see Sec. 740.7(d)(1) of the EAR) of computers having a 
CTP level of greater than 85,000 MTOPS, should be reported under the 
post shipment verification reporting provisions of Sec. 742.12 of 
the EAR and need not be reported under the Wassenaar reporting 
provisions in this section of the EAR.

* * * * *
    (e) * * *
    (2) Reports for ``digital computers'' and ``electronic assemblies'' 
controlled under ECCN 4A003.b and .c must include the CTP of each 
computer or aggregation of computing elements in shipment.

PART 748--[AMENDED]

    12. Section 748.10 is amended by revising paragraph (b)(3) to read 
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, regardless of dollar value, that requires a 
license application.
* * * * *

PART 774--[AMENDED]

    13. In Supplement No. 1 to part 774 (the Commerce Control List), 
Category 4--Computers is amended by revising Export Control 
Classification Number (ECCN) 4A003; ``License Requirements'' and ``List 
of Items Controlled'' sections of ECCN 4A001; and the ``License 
Requirements'' section of ECCNs of 4A002, 4D001, 4D002, and 4E001 to 
read as follows:

4A001  Electronic computers and related equipment, and ``electronic 
assemblies'' and specially designed components therefor

License Requirements

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

------------------------------------------------------------------------
                Control(s)                          Country chart
------------------------------------------------------------------------
NS applies to entire entry................  NS Column 2.
MT applies to items in 4A001.a when the     MT Column 1.
 parameters in 4A101 are met or exceeded.
AT applies to entire entry................  AT Column 1.
------------------------------------------------------------------------

    NP applies, unless a License Exception is available. See 
Sec. 742.3(b) of the EAR for information on applicable licensing review 
policies.
    XP applies to electronic computers with a CTP greater than 28,000 
MTOPS, unless a License Exception is available. XP controls vary 
according to destination and end-user and end-use; however, XP does not 
apply to Canada. See Sec. 742.12 of the EAR for additional information.
    License Requirement Notes: See Sec. 743.1 of the EAR for reporting

[[Page 10616]]

requirements for exports under License Exceptions.
* * * * *

List of Items Controlled

Unit: Equipment in number; parts and accessories in $ value
Related Controls: See also 4A101 and 4A994. Equipment designed or rated 
for transient ionizing radiation is subject to the export licensing 
authority of the U.S. Department of State, Office of Defense Trade 
Controls. (See 22 CFR part 121.)
Related Definitions: For the purposes of integrated circuits in 
4A001.a.2, 5  x  103 Gy(Si) = 5  x  105 Rads 
(Si); 5  x  106 Gy (Si)/s = 5  x  108 Rads (Si)/
s.
Items:
a. Specially designed to have either of the following characteristics:
a.1. Rated for operation at an ambient temperature below 228 K 
(-45 deg.C) or above 358 K (85 deg.C);

    Note: 4A001.a.1. does not apply to computers specially designed 
for civil automobile or railway train applications.


a.2. Radiation hardened to exceed any of the following specifications:
a.2.a. A total dose of 5  x  103 Gy (Si);
a.2.b. A dose rate upset of 5  x  106 Gy (Si)/s; or
a.2.c. Single Event Upset of 1  x  10-7 Error/bit/day;
b. Having characteristics or performing functions exceeding the limits 
in Category 5, Part 2 (``Information Security'').

4A002  ``Hybrid computers'' and ``electronic assemblies'' and 
specially designed components therefor

License Requirements

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

------------------------------------------------------------------------
                Control(s)                          Country chart
------------------------------------------------------------------------
NS applies to entire entry................  NS Column 2.
MT applies to hybrid computers combined     MT Column 1.
 with specially designed ``software'', for
 modeling, simulation, or design
 integration of complete rocket systems
 and unmanned air vehicle systems that are
 usable in systems controlled for MT
 reasons.
AT applies to entire entry................  AT Column 1.
------------------------------------------------------------------------

NP applies, unless a License Exception is available. See Sec. 742.3(b) 
of the EAR for information on applicable licensing review policies.
XP applies to hybrid computers with a CTP greater than 28,000 MTOPS, 
unless a License Exception is available. XP controls vary according to 
destination and end-user and end-use; however, XP does not apply to 
Canada. See Sec. 742.12 of the EAR for additional information.
* * * * *

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 4A994  AT Column 1
 for controls on digital computers with a
 CTP  6 but  to
 28,000 MTOPS).
------------------------------------------------------------------------

NP applies, 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 28,000 MTOPS, 
unless a License Exception is available. XP controls vary according to 
destination and end-user and end-use; however, XP does not apply to 
Canada. See Sec. 742.12 of the EAR for additional information.

    Note: For all destinations, except Cuba, Iran, Iraq, Libya, 
North Korea, Sudan, Syria, no license is required (NLR) for 
computers with a CTP not greater than 28,000 MTOPS and for 
``electronic assemblies'' described in 4A003.c that are not capable 
of exceeding a CTP greater than 28,000 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, b. and .c.
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 or .b, and ``electronic 
assemblies'' controlled by 4A003.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 .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

[[Page 10617]]

processing unit fails, an idling but mirroring 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 28,000 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 200,000,000;
    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 1.25 Gbyte/s.


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

* * * * *

4D001  ``Software'' Specially Designed or Modified for the 
``Development'', ``Production'' or ``Use'' of Equipment or 
``Software'' Controlled by 4A001 to 4A004, or 4D (Except 4D980, 
4D993 or 4D994)

License Requirements

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

------------------------------------------------------------------------
                Control(s)                          Country chart
------------------------------------------------------------------------
NS applies to ``software'' for commodities  NS Column 1.
 or software controlled by 4A001 to 4A004,
 4D001 to 4D003.
MT applies to ``software'' for equipment    MT Column 1.
 controlled by 4A001 to 4A003 for MT
 reasons.
CC applies to ``software'' for              CC Column 1.
 computerized finger-print equipment
 controlled by 4A003 for CC reasons.
AT applies to entire entry................  AT Column 1.
------------------------------------------------------------------------

NP applies, unless a License Exception is available. See Sec. 742.3(b) 
of the EAR for information on applicable licensing review policies.
XP applies to ``software'' for computers with a CTP greater than 28,000 
MTOPS, unless a License Exception is available. XP controls vary 
according to destination and end-user and end-use; however, XP does not 
apply to Canada. See Sec. 742.12 of the EAR for additional information.
    License Requirement Notes: See Sec. 743.1 of the EAR for reporting 
requirements for exports under License Exceptions.
* * * * *

4D002  ``Software'' Specially Designed or Modified to Support 
``Technology'' Controlled by 4E (Except 4E980, 4E992, and 4E993)

License Requirements

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

------------------------------------------------------------------------
                Control(s)                          Country chart
------------------------------------------------------------------------
NS applies to entire entry................  NS Column 1.
MT applies to ``software'' for equipment    MT Column 1.
 controlled by 4E for MT reasons.
AT applies to entire entry................  AT Column 1.
------------------------------------------------------------------------

NP applies, unless a License Exception is available. See Sec. 742.3(b) 
of the EAR for information on applicable licensing review policies.
XP applies to ``software'' for computers with a CTP greater than 28,000 
MTOPS, unless a License Exception is available. XP controls vary 
according to destination and end-user and end-use; however, XP does not 
apply to Canada. See Sec. 742.12 of the EAR for additional information.
* * * * *

4E001  ``Technology'' According to the General Technology Note, for 
the ``Development'', ``Production'' or ``Use'' of Equipment or 
``Software'' Controlled by 4A (Except 4A980, 4A993 or 4A994) or 4D 
(Except 4D980, 4D993, 4D994).

License Requirements

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

------------------------------------------------------------------------
                Control(s)                          Country chart
------------------------------------------------------------------------
NS applies to ``technology'' for            NS Column 1.
 commodities or software controlled by
 4A001 to 4A004, 4D001 to 4D003.
MT applies to ``technology'' for items      MT Column 1.
 controlled by 4A001 to 4A003 4A101,
 4D001, 4D102 or 4D002 for MT reasons.
CC applies to ``technology'' for            CC Column 1.
 computerized fingerprint equipment
 controlled by 4A003 for CC reasons.
AT applies to entire entry................  AT Column 1.
------------------------------------------------------------------------

NP applies, unless a License Exception is available. See Sec. 742.3(b) 
of the EAR for information on applicable licensing review policies.
XP applies to ``technology'' for computers with a CTP greater than 
28,000 MTOPS, unless a License Exception is available. XP controls vary 
according to destination and end-user and end-use, however, XP does not 
apply to Canada. See Sec. 742.12 of the EAR for additional information.
    License Requirement Notes: See Sec. 743.1 of the EAR for reporting 
requirements for exports under License Exceptions.
* * * * *

    Dated: March 5, 2002.
James J. Jochum,
Assistant Secretary for Export Administration.
[FR Doc. 02-5563 Filed 3-5-02; 4:04 pm]
BILLING CODE 3510-33-P