[Federal Register Volume 73, Number 71 (Friday, April 11, 2008)]
[Proposed Rules]
[Pages 19778-19780]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 08-1122]


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DEPARTMENT OF STATE

22 CFR Part 121

[Public Notice 6187]
RIN 1400-AC47


Amendment to the International Traffic in Arms Regulations: The 
United States Munitions List

AGENCY: Department of State.

ACTION: Proposed Rule.

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SUMMARY: The Department of State is proposing to amend the text of the 
International Traffic in Arms Regulations (ITAR), Part 121, to add 
language clarifying how the criteria of Section 17(c) of the Export 
Administration Act of 1979 (``EAA'') are implemented in accordance with 
the Department of State's obligations under the Arms Export Control Act 
(``AECA''), and restating the Department's longstanding policy and 
practice of implementing the criteria of this provision.

DATES: Effective Date: The Department of State will accept comments on 
this proposed rule until May 12, 2008.

ADDRESSES: Interested parties may submit comments within 30 days of the 
date of publication by any of the following methods:
     E-mail: [email protected] with an appropriate 
subject line.
     Mail: Department of State, Directorate of Defense Trade 
Controls, Office of Defense Trade Controls Policy, ATTN: Regulatory 
Change, ITAR Section 121, SA-1, 12th Floor, Washington, DC 20522-0112.
    Persons with access to the Internet may also view this notice by 
going to the regulations.gov Web site at http://regulations.gov/index.cfm.

FOR FURTHER INFORMATION CONTACT: Director Ann Ganzer, Office Defense 
Trade Controls Policy, Department of State, Telephone (202) 663-2792 or 
Fax (202) 261-8199; E-mail [email protected]. ATTN: Regulatory 
Change, ITAR Part 121.

SUPPLEMENTARY INFORMATION: There have been an increasing number of 
Commodity Jurisdiction (CJ) requests for certain basic parts and 
components having a long history of use on both civil and military 
aircraft. The intent of this notice is to make it clear that these 
parts and components are not subject to the jurisdiction of the 
Department of State and to restate the Department's longstanding 
practice of using the CJ process to determine the applicability of the 
criteria of Section 17(c) of the EAA (``Section 17(c)'') in cases where 
there is uncertainty.
    Specifically, Section 17(c) states that any product (1) which is 
standard equipment, certified by the Federal Aviation Administration 
(``FAA''), in civil aircraft and is an integral part of such aircraft, 
and (2) which is to be exported to a country other than a controlled 
country, shall be subject to export controls exclusively under the EAA. 
Although the EAA expired on August 20, 2001, the President, through 
Executive Order 13222 of August 17, 2001, as extended by the notice of 
August 15, 2007, directed that the provisions of the EAA be carried out 
to the extent permitted by law.
    Since its passage, the Department has implemented Section 17(c) 
through various regulatory amendments and notices consistent with the 
aims of the EAA and the AECA.
    While Section 17(c) criteria apply to certain parts and components 
for civil aircraft, there have been recurring questions regarding its 
scope and meaning, and the Department's interpretation of its 
provisions. For example, while the language of Section 17(c) referred 
specifically to certain products that are standard equipment in civil 
aircraft, some exporters have mistakenly believed this provision 
applied to complete aircraft. Exporters have also suggested that FAA 
``certification'' should by itself be sufficient to determine whether 
an article is subject to the controls of the USML. While FAA 
certification is one of the factors in the Section 17(c) criteria, FAA 
certifications serve a different purpose (safety of flight), and the 
FAA may issue a civil certification for military aircraft and their 
parts and components (e.g., the C-130J).
    Shortly after the enactment of Section 17(c), the Department 
requested, through a proposed rule in the Federal Register on December 
19, 1980, the opinions of the public as well as other agencies 
regarding the implementation of Section 17(c). The Department received 
many comments from the public, the Department of Commerce, and several 
other agencies. The Department noted that certain inertial navigation 
systems destined for specific

[[Page 19779]]

countries would be deleted from the USML, due primarily to the 
enactment of Section 17(c). In 1981, the Department conducted a review 
of the USML consistent with the AECA and Section 17(c) to determine 
whether any articles should be removed. The results were formally 
reported in a congressionally mandated report to Congress. This report 
came soon after Congress rejected a House bill that would have removed 
from the USML certain defense articles having a ``direct civilian 
application.'' Several years later, after taking into consideration the 
comments received from the public and other agencies on its proposed 
rule, the Department published a final rule in the Federal Register on 
December 6, 1984. In this rule, the Department noted there had been 
confusion on the relationship of the ITAR to the export regulations 
administered by the Department of Commerce. In an effort to provide 
clarity, the Department provided some general guidance by adding the 
then new Part 120 (at the time titled: Purpose, background and 
definitions), and the Department also referenced certain notable 
deletions to the USML, including certain trainer aircraft and certain 
inertial navigation systems.
    However, some questions on this issue remained, so on April 7, 
1988, the Department published a final rule in the Federal Register. 
Consistent with the Department's long established practice at that time 
of implementing Section 17(c), the Department added language to the 
ITAR requiring that a CJ review take place to determine whether any 
FAA-certified developmental aircraft or components thereof would be 
removed from the USML. The Department noted this change helped to 
conform the ITAR to the Department's current practice of requiring CJ's 
to address such uncertainties, and that this change would ensure the 
items excluded under Section 17(c) were properly identified. The 
Department again obtained comments from the public regarding this 
change.
    In the years since the 1988 Federal Register Notice described above 
was published, the ITAR has consistently required a CJ review take 
place where there are uncertainties regarding whether an item is 
covered by the USML, including whether the item falls within the 
criteria of Section 17(c). In 1991, the Department undertook a 
comprehensive review of the USML to address jurisdiction over articles 
seemingly subject to both the USML and the Commerce Control List. This 
large interagency review was conducted consistent with the AECA and 
Section 17(c), and resulted in the removal of certain items from USML 
control. In 1996, based on interagency discussions, the specific 
reference to Section 17(c) in the ITAR was removed, but the 
Department's policy and practice of applying the criteria of Section 
17(c) remained. We note that the removal of the reference to Section 
17(c) may have caused some of the current confusion as to the 
Department's policy and procedures for applying Section 17(c).
    This proposed rule reinstates the Section 17(c) reference in the 
ITAR to assist exporters in understanding the scope and application of 
the Section 17(c) criteria to parts and components for civil aircraft. 
It also clarifies that any part or component that (a) is standard 
equipment; (b) is covered by a civil aircraft type certificate 
(including amended type certificates and supplemental type 
certificates) issued by the Federal Aviation Administration for civil, 
non-military aircraft (this expressly excludes military aircraft 
certified as restricted and any type certification of Military 
Commercial Derivative Aircraft); and (c) is an integral part of such 
civil aircraft, is subject to the Export Administration Regulations. 
Where such part or component is not Significant Military Equipment 
(``SME''), no CJ determination is required to determine whether the 
item meets these criteria for exclusion under the USML, unless doubt 
exists as to whether these criteria have been met. However, where the 
part or component is SME, a CJ determination is always required, except 
where an SME part or component was integral to civil aircraft prior to 
the effective date of this rule.
    Additionally, this proposed rule adds language in a new Note after 
Category VIII(h) to provide guidelines concerning the parts or 
components meeting these criteria. The change to Category VIII(b) also 
identifies and designates certain sensitive military items, heretofore 
controlled under Category VIII(h), as SME in order to simplify the 
implementation of the criteria of Section 17(c) consistent with the 
aims of the AECA. Previous and current licenses and other 
authorizations concerning these items will not require notification in 
accordance with Sec.  124.11, and will not require a DSP-83, unless 
they are amended, modified, or renewed.
    This requirement for a CJ determination by the Department of State 
helps ensure the U.S. Government is made aware of, and can reach an 
informed decision regarding, any sensitive military item proposed for 
standardization in the commercial aircraft industry before the item or 
technology is actually applied to a commercial aircraft program, 
whether such item is integral to the aircraft, and, if so, whether the 
development, production, and use of the technology associated with the 
item should nevertheless be controlled on the USML. It will also ensure 
the Department of State fulfills the requirements of section 38(f) of 
the Arms Export Control Act.
    This regulation is intended to clarify the control of aircraft 
parts and components, and does not remove any items from the USML, nor 
does it change any CJ determinations. Should there be an apparent 
conflict between this regulation and a CJ determination issued prior to 
this date, the holder of the determination should seek reconsideration, 
citing this regulation.

Regulatory Analysis and Notices

Administrative Procedure Act

    This amendment involves a foreign affairs function of the United 
States and, therefore, is not subject to the procedures contained in 5 
U.S.C. 553 and 554.

Regulatory Flexibility Act

    Since this amendment involves a foreign affairs function of the 
United States, it does not require analysis under the Regulatory 
Flexibility Act.

Unfunded Mandates Reform Act of 1995

    This amendment does not involve a mandate that will result in the 
expenditure by State, local, and tribal governments, in the aggregate, 
or by the private sector, of $100 million or more in any year and it 
will not significantly or uniquely affect small governments. Therefore, 
no actions were deemed necessary under the provisions of the Unfunded 
Mandates Reform Act of 1995.

Small Business Regulatory Enforcement Fairness Act of 1996

    This amendment has been found not to be a major rule within the 
meaning of the Small Business Regulatory Enforcement Fairness Act of 
1996.

Executive Orders 12372 and 13132

    This amendment will not have substantial effects on the States, on 
the relationship between the national government and the States, or on 
the distribution of power and responsibilities among the various levels 
of government. Therefore, in accordance with Executive Order 13132, it 
is determined that this amendment does not have sufficient federalism 
implications to require consultations or warrant the preparation of a 
federalism summary impact statement. The

[[Page 19780]]

regulations implementing Executive Order 12372 regarding 
intergovernmental consultation on Federal programs and activities do 
not apply to this amendment.

Executive Order 12866

    This amendment is exempt from the review under Executive Order 
12866, but has been reviewed internally by the Department of State to 
ensure consistency with the purposes thereof.

Paperwork Reduction Act

    This rule does not impose any new reporting or recordkeeping 
requirements subject to the Paperwork Reduction Act, 44 U.S.C. Chapter 
35.

List of Subjects in 22 CFR Part 121

    Arms and munitions, Exports, U.S. Munitions List.

    Accordingly, for the reasons set forth above, Title 22, Chapter I, 
Subchapter M, part 121 is proposed to be amended as follows:

PART 121--THE UNITED STATES MUNITIONS LIST

    1. The authority citation for part 121 continues to read as 
follows:

    Authority: Secs. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 (22 
U.S.C. 2752, 2778, 2797); E.O. 11958, 42 FR 4311; 3 CFR, 1977 Comp, 
p. 79; 22 U.S.C. 2658; Pub L. 105-261, 112 Stat.1920.

    2. Section 121.1, paragraph (c) Category VIII is amended by 
revising Category VIII paragraphs (b) and (h) to read as follows:


Sec.  121.1  General. The United States Munitions List.

* * * * *

Category VIII--Aircraft and Associated Equipment

* * * * *
    (b) Military aircraft engines, except reciprocating engines, 
specifically designed or modified for the aircraft in paragraph (a) 
of this category, and all specifically designed military hot section 
components (i.e., combustion chambers and liners; high pressure 
turbine blades, vanes, disks and related cooled structure; cooled 
low pressure turbine blades, vanes, disks and related cooled 
structure; cooled augmenters; and cooled nozzles) and digital engine 
controls (e.g., Full Authority Digital Engine Controls (FADEC) and 
Digital Electronic Engine Controls (DEEC)).
* * * * *
    (h) Components, parts, accessories, attachments, and associated 
equipment (including ground support equipment) specifically designed 
or modified for the articles in paragraphs (a) through (d) of this 
category, excluding aircraft tires and propellers used with 
reciprocating engines.

    Note: The Export Administration Regulations (EAR) administered 
by the Department of Commerce control any part or component 
(including propellers) designed exclusively for civil, non-military 
aircraft (see Sec.  121.3 for the definition of military aircraft) 
and civil, non-military aircraft engines. Also, a non-SME component 
or part (as defined in Sec.  121.8(b) and (d) of this subchapter) 
that is not controlled under another category of the USML, that: (a) 
Is standard equipment; (b) is covered by a civil aircraft type 
certificate (including amended type certificates and supplemental 
type certificates) issued by the Federal Aviation Administration for 
a civil, non-military aircraft (this expressly excludes military 
aircraft certified as restricted and any type certification of 
Military Commercial Derivative Aircraft); and (c) is an integral 
part of such civil aircraft, is subject to the control of the EAR. 
In the case of any part or component designated as SME in this or 
any other USML category, a determination that such item may be 
excluded from USML coverage based on the three criteria above always 
requires a commodity jurisdiction determination by the Department of 
State under Sec.  120.4 of this subchapter. The only exception to 
this requirement is where a part or component designated as SME in 
this category was integral to civil aircraft prior to [effective 
date of the final rule]. For such part or component, U.S. exporters 
are not required to seek a commodity jurisdiction determination from 
State, unless doubt exists as to whether the item meets the three 
criteria above (See Sec.  120.3 and Sec.  120.4 of this subchapter). 
Also, U.S. exporters are not required to seek a commodity 
jurisdiction determination from State regarding any non-SME 
component or part (as defined in Sec.  121.8(b) and (d) of this 
subchapter) that is not controlled under another category of the 
USML, unless doubt exists as to whether the item meets the three 
criteria above (See Sec.  120.3 and Sec.  120.4 of this subchapter). 
These commodity jurisdiction determinations will ensure compliance 
with this section and the criteria of Section 17(c) of the Export 
Administration Act of 1979. In determining whether the three 
criteria above have been met, consider whether the same item is 
common to both civil and military applications without modification. 
Some examples of parts or components that are not common to both 
civil and military applications are tail hooks, radomes, and low 
observable rotor blades. ``Standard equipment'' is defined as a part 
or component manufactured in compliance with an established and 
published industry specification or an established and published 
government specification (e.g., AN, MS, NAS, or SAE). Parts and 
components that are manufactured and tested to established but 
unpublished civil aviation industry specifications and standards are 
also ``standard equipment,'' e.g., pumps, actuators, and generators. 
A part or component is not standard equipment if there are any 
performance, manufacturing or testing requirements beyond such 
specifications and standards. Simply testing a part or component to 
meet a military specification or standard does not in and of itself 
change the jurisdiction of such part or component unless the item 
was designed or modified to meet that specification or standard. 
Integral is defined as a part or component that is installed in the 
aircraft. In determining whether a part or component may be 
considered as standard equipment and integral to a civil aircraft 
(e.g., latches, fasteners, grommets, and switches) it is important 
to carefully review all of the criteria noted above. For example, a 
part approved solely on a non-interference/provisions basis under a 
type certificate issued by the Federal Aviation Administration would 
not qualify. Similarly, unique application parts or components not 
integral to the aircraft would also not qualify.

* * * * *

    Dated: April 2, 2008.
John C. Rood,
Acting Under Secretary for Arms Control and International Security, 
Department of State.
[FR Doc. 08-1122 Filed 4-9-08; 1:48pm]
BILLING CODE 4710-25-P