[Federal Register Volume 76, Number 237 (Friday, December 9, 2011)]
[Notices]
[Pages 76935-76937]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-31690]
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
[Docket No. 111130706-1686-01]
Impact of Implementing the Chemical Weapons Convention (CWC) on
Commercial Activities Involving ``Schedule 1'' Chemicals Through
Calendar Year 2011; Impact of Adding Salts of CWC ``Schedule 1''
Chemicals to ``Schedule 1;'' Impact of Declaring Production of
``Schedule 1'' Chemicals as Intermediates
AGENCY: Bureau of Industry and Security, Commerce.
ACTION: Notice of inquiry.
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SUMMARY: The Bureau of Industry and Security (BIS) is seeking public
comments on the impact that implementation of the Chemical Weapons
Convention (CWC), through the Chemical Weapons Convention
Implementation Act (CWCIA), and the Chemical Weapons Convention
Regulations (CWCR), has had on commercial activities involving
``Schedule 1'' chemicals during calendar year 2011. Additionally, BIS
seeks public comments on whether the addition of salts of certain CWC
``Schedule 1'' chemicals (e.g., saxitoxin or nitrogen mustards) to the
list of ``Schedule 1'' chemicals in the CWC Annex on Chemicals would
impact any commercial activities. Finally, BIS is seeking public
comments on whether any commercial chemical production activities in
the U.S. could possibly involve the production of a ``Schedule 1''
chemical as an intermediate in the synthesis of other chemicals. In
this regard, note that the CWC, CWCIA, and CWCR have the potential to
impact commercial activities, not only when the ``Schedule 1''
chemicals are end products, but whenever ``Schedule 1'' chemicals
(e.g., nitrogen mustards) are produced as intermediates in the
synthesis of other chemicals.
DATES: Comments must be received by January 9, 2012.
ADDRESSES: You may submit comments by any of the following methods:
Email: [email protected]. Include the phrase ``Schedule
1 Notice of Inquiry'' in the subject line;
Fax: (202) 482-3355 (Attn: Willard Fisher);
Mail or Hand Delivery/Courier: Willard Fisher, U.S.
Department of Commerce, Bureau of Industry and Security, Regulatory
Policy Division, 14th Street & Pennsylvania Avenue NW., Room 2705,
Washington, DC 20230.
FOR FURTHER INFORMATION CONTACT: For questions on the Chemical Weapons
Convention requirements for ``Schedule 1'' chemicals, contact Douglas
Brown, Treaty Compliance Division, Office of Nonproliferation and
Treaty Compliance, Bureau of Industry and Security, U.S. Department of
Commerce, Phone: (202) 482-1001. For questions on the submission of
comments, contact Willard Fisher, Regulatory Policy Division, Office of
Exporter Services, Bureau of Industry and Security, U.S. Department of
Commerce, Phone: (202) 482-2440.
SUPPLEMENTARY INFORMATION:
Background
The purpose of this notice of inquiry is threefold: (1) To collect
information to assist BIS in its preparation of the annual
certification to the Congress that is required under Condition 9 of
Senate Resolution 75, April 24, 1997, in which the Senate gave its
advice and consent to the ratification of the Chemical Weapons
Convention; (2) to collect information that would assist BIS to
evaluate whether salts of certain ``Schedule 1'' chemicals should be
added to the list of ``Schedule 1'' chemicals; and (3) to collect
information that would indicate to BIS whether any ``Schedule 1''
chemicals, or salts thereof, are produced as intermediates in the
commercial production of some other chemical.
Request for Comments Concerning the Impact of Implementing the Chemical
Weapons Convention (CWC) on Commercial Activities Involving ``Schedule
1'' Chemicals Through Calendar Year 2011
In providing its advice and consent to the ratification of the
Convention on the Prohibition of the Development, Production,
Stockpiling, and Use of Chemical Weapons and Their Destruction,
commonly called the Chemical Weapons Convention (CWC) (the Convention),
the Senate included, in Senate Resolution 75 (S. Res. 75, April 24,
1997), several conditions to its ratification. Condition 9, titled
``Protection of Advanced Biotechnology,'' calls for the President to
certify to Congress on an annual basis that ``the legitimate commercial
activities and interests of chemical, biotechnology, and pharmaceutical
firms in the United States are not being significantly harmed by the
limitations of the Convention on access to, and production of, those
chemicals and toxins listed in Schedule 1.'' On July 8, 2004, President
Bush, by Executive Order 13346, delegated his authority to make the
annual certification to the Secretary of Commerce.
The CWC is an international arms control treaty that contains
certain verification provisions. In order to implement these
verification provisions, the CWC established the Organization for the
Prohibition of Chemical Weapons (OPCW). The CWC imposes certain
obligations on countries that have ratified the Convention (i.e.,
States Parties), among which are the enactment of legislation to
prohibit the production, storage, and use of chemical weapons, and the
establishment of a National Authority to serve as the national focal
point for effective liaison with the OPCW and other States Parties for
the purpose of achieving the object and purpose of the Convention and
the implementation of its provisions. The CWC also requires each State
Party to implement a comprehensive data declaration and inspection
regime to provide transparency and to verify that both the public and
private sectors of the State Party are not engaged in activities
prohibited under the CWC.
``Schedule 1'' chemicals consist of those toxic chemicals and
precursors set forth in the CWC ``Annex on Chemicals'' and in
Supplement No. 1 to part 712 of the Chemical Weapons Convention
Regulations (CWCR) (15 CFR parts 710-722). The CWC identified these
toxic chemicals and precursors as posing a high risk to the object and
purpose of the Convention.
The CWC restricts the production of ``Schedule 1'' chemicals for
protective purposes to two facilities per State Party. The CWC Article-
by-Article Analysis submitted to the Senate in Treaty Doc. 103-21
defined the term ``protective purposes'' to mean ``used for determining
the adequacy of defense equipment and measures.'' Consistent with this
definition, U.S. implementation, as authorized via Presidential
Decision Directive (PDD) 70, December 17, 1999, assigned the
responsibility to operate these two facilities to the Department of
Defense (DOD), thereby precluding commercial production of ``Schedule
1'' chemicals for protective purposes in the United States. The
Department of Defense maintains strict controls on ``Schedule 1''
chemicals produced at its facilities in order to ensure the
accountability and proper use of such chemicals, consistent with the
object and purpose of the Convention. These actions did not establish
any limitations on ``Schedule 1'' chemical activities that are not
prohibited by the CWC. However, the CWC stipulates a one metric ton
limit for ``Schedule 1'' chemicals in a State Party.
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The provisions of the CWC that affect commercial activities
involving ``Schedule 1'' chemicals are implemented in the CWCR (see 15
CFR 712) and in the Export Administration Regulations (EAR) (see 15 CFR
742.18 and 15 CFR 745), both of which are administered by the Bureau of
Industry and Security (BIS). Pursuant to CWC requirements, the CWCR
restrict commercial production of ``Schedule 1'' chemicals to research,
medical, or pharmaceutical purposes. Other industrial uses are
prohibited. The CWCR also contain other requirements and prohibitions
that apply to ``Schedule 1'' chemicals and/or ``Schedule 1''
facilities. Specifically, the CWCR:
(1) Prohibit the import of ``Schedule 1'' chemicals from States not
Party to the Convention (15 CFR 712.2(b));
(2) Require annual declarations by certain facilities engaged in
the production of ``Schedule 1'' chemicals in excess of 100 grams
aggregate per calendar year (i.e., declared ``Schedule 1'' facilities)
for purposes not prohibited by the Convention (15 CFR 712.5(a)(1) and
(a)(2));
(3) Require government approval of ``declared Schedule 1''
facilities (15 CFR 712.5(f));
(4) Provide that ``declared Schedule 1'' facilities are subject to
initial and routine inspection by the Organization for the Prohibition
of Chemical Weapons (15 CFR 712.5(e) and 716.1(b)(1));
(5) Require 200 days advance notification of establishment of new
``Schedule 1'' production facilities producing greater than 100 grams
aggregate of ``Schedule 1'' chemicals per calendar year (15 CFR 712.4);
(6) Require advance notification and annual reporting of all
imports and exports of ``Schedule 1'' chemicals to, or from, other
States Parties to the Convention (15 CFR 712.6, 742.18(a)(1) and
745.1); and
(7) Prohibit the export of ``Schedule 1'' chemicals to States not
Party to the Convention (15 CFR 742.18(a)(1) and (b)(1)(ii)).
In order to assist in determining whether the legitimate commercial
activities and interests of chemical, biotechnology, and pharmaceutical
firms in the United States are significantly harmed by the limitations
of the Convention on access to, and production of, ``Schedule 1''
chemicals as described in this notice, BIS is seeking public comments
on any effects that implementation of the Chemical Weapons Convention,
through the Chemical Weapons Convention Implementation Act and the
Chemical Weapons Convention Regulations, has had on commercial
activities involving ``Schedule 1'' chemicals during calendar year
2011. To allow BIS to properly evaluate the significance of any harm to
commercial activities involving ``Schedule 1'' chemicals, public
comments submitted in response to this notice of inquiry should include
both a quantitative and qualitative assessment of the impact of the CWC
on such activities.
Request for Comments Concerning the Impact of Adding Salts of Certain
CWC ``Schedule 1'' Chemicals to the List of ``Schedule 1'' Chemicals in
the CWC Annex on Chemicals
The OPCW has recently been considering whether to add salts of
certain ``Schedule 1'' chemicals, specifically of saxitoxin and
nitrogen mustards, to the list of ``Schedule 1'' chemicals in the CWC
Annex on Chemicals. This would mean that the salts of these ``Schedule
1'' chemicals would likely be identified as ``Schedule 1'' chemicals,
themselves. As a result, they too would become subject to any impact
that implementation of the CWC, through the CWCIA and the CWCR, has on
commercial activities involving ``Schedule 1'' chemicals.
BIS seeks comments as to whether salts of any ``Schedule 1''
chemical, which are not currently listed as ``Schedule 1'' chemicals in
the CWC Annex on Chemicals, are produced (as an end product or in a
captive use situation), consumed, transferred, or stored in the United
States. Note that, if the CWC were to add any of these salts to the
list of ``Schedule 1'' chemicals in the CWC Annex on Chemicals, this
could impact commercial activities in the event that these new
``Schedule 1'' chemicals were produced as intermediates in the
synthesis of other chemicals. For example, such production or captive
use by a facility, following a decision by the OPCW to add any of these
salts to the list of ``Schedule 1'' chemicals in the CWC Annex on
Chemicals, could subject that facility to the CWC requirements for
destruction of ``chemical weapons production facilities.''
Request for Comments on Whether Any ``Schedule 1'' Chemicals, or Salts
Thereof, Are Produced as Intermediates in the Commercial Production of
Some Other Chemical
As defined in 15 CFR 710.1, production of a ``Schedule 1'' chemical
means formation through chemical synthesis as well as processing to
extract and isolate ``Schedule 1'' chemicals. On November 10, 2005, the
Organization for the Prohibition of Chemical Weapons (OPCW) decided,
``that the production of a ``Schedule 1'' chemical is understood, for
declaration purposes, to include intermediates, by-products, or waste
products that are produced and consumed within a defined chemical
manufacturing sequence, where such intermediates, by-products, or waste
products are chemically stable and therefore exist for a sufficient
time to make isolation from the manufacturing stream possible, but
where, under normal or design operating conditions, isolation does not
occur'' (C-10/DEC.12). At the time of this decision, there were no
known examples of so-called captive use of ``Schedule 1'' chemicals.
This is no longer the case. Based on new information provided by
Denmark to the Executive Council of the OPCW, the United States is
aware that a commercial pharmaceutical facility in Denmark produced a
``Schedule 1'' chemical (a nitrogen mustard), as an intermediate in the
production of another chemical, which, arguably, would cause the
facility to meet the definition of a Chemical Weapons Production
Facility.
While it appears unlikely that the pharmaceutical facility will be
determined to be a Chemical Weapons Production Facility, Denmark has
ordered the facility to halt future production of the pharmaceutical
product and sought resolution through the OPCW Executive Council.
In view of this development, BIS is seeking public comments as to
whether any similar situations of so-called captive use of a ``Schedule
1'' chemical may exist in the United States.
Submission of Comments
All comments must be submitted to one of the addresses indicated in
this notice. The Department requires that all comments be submitted in
written form.
The Department encourages interested persons who wish to comment to
do so at the earliest possible time. The period for submission of
comments will close on January 9, 2012. The Department will consider
all comments received before the close of the comment period. Comments
received after the end of the comment period will be considered if
possible, but their consideration cannot be assured. The Department
will not accept comments accompanied by a request that a part or all of
the material be treated confidentially because of its business
proprietary nature or for any other reason. The Department will return
such comments and materials to the persons submitting the comments and
will not consider them. All
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comments submitted in response to this notice will be a matter of
public record and will be available for public inspection and copying.
The Office of Administration, Bureau of Industry and Security, U.S.
Department of Commerce, displays public comments on the BIS Freedom of
Information Act (FOIA) Web site at http://www.bis.doc.gov/foia. This
office does not maintain a separate public inspection facility. If you
have technical difficulties accessing this Web site, please call BIS's
Office of Administration, at (202) 482-1093, for assistance.
Dated: December 5, 2011.
Kevin J. Wolf,
Assistant Secretary for Export Administration.
[FR Doc. 2011-31690 Filed 12-8-11; 8:45 am]
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