[Federal Register Volume 78, Number 192 (Thursday, October 3, 2013)]
[Rules and Regulations]
[Pages 61750-61761]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-24235]



[[Page 61749]]

Vol. 78

Thursday,

No. 192

October 3, 2013

Part VIII





 Department of State





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22 CFR Parts 120, 121, 123, et al.





 Amendment to the International Traffic in Arms Regulations: Initial 
Implementation of Export Control Reform; Correction; Final Rule

  Federal Register / Vol. 78, No. 192 / Thursday, October 3, 2013 / 
Rules and Regulations  

[[Page 61750]]


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DEPARTMENT OF STATE

22 CFR Parts 120, 121, 123, and 126

RIN 1400-AD37
[Public Notice 8493]


Amendment to the International Traffic in Arms Regulations: 
Initial Implementation of Export Control Reform; Correction

AGENCY: Department of State.

ACTION: Final rule; correction.

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SUMMARY: The Department of State is correcting a final rule that 
appeared in the Federal Register of April 16, 2013.

DATES: This rule is effective October 15, 2013.

FOR FURTHER INFORMATION CONTACT: Mr. C. Edward Peartree, Director, 
Office of Defense Trade Controls Policy, Department of State, telephone 
(202) 663-2792; email [email protected]. ATTN: Regulatory 
Change, Corrections to First ECR Final Rule.

SUPPLEMENTARY INFORMATION: The Department provides the following 
corrections to the rule, ``Amendment to the International Traffic in 
Arms Regulations: Initial Implementation of Export Control Reform,'' 
published on April 16, 2013 and effective on October 15, 2013 (78 FR 
22740). As part of the President's Export Control Reform (ECR) effort, 
that rule amended the International Traffic in Arms Regulations (ITAR) 
to revise four U.S Munitions List (USML) categories, provide new 
definitions, and provide policies and procedures regarding the 
licensing of items moving from the export jurisdiction of the 
Department of State to the Department of Commerce.
    Most of the changes in this rule are meant to clarify the 
regulation by correcting grammatical and punctuation errors, providing 
references and more appropriate arrangement of the regulation, and in a 
few instances correcting unintended consequences of the regulation as 
published on April 16. In addition, certain errors and omissions in the 
Transition Plan included in that rule are corrected, and a revised 
Supplement No. 1 to part 126, which takes into account the changes made 
to the USML thus far, is provided.
    Pursuant to ECR, the Department of Commerce has been publishing 
revisions to the Export Administration Regulations, including various 
revisions to the Commerce Control List. Revision of the USML and CCL 
are coordinated so there is uninterrupted regulatory coverage for items 
moving from the jurisdiction of the Department of State to that of the 
Department of Commerce. The Department of Commerce's companion to the 
rule corrected in this notice (see ``Revisions to the Export 
Administration Regulations: Initial Implementation of Export Control 
Reform,'' 78 FR 22660) is also corrected in this edition of the Federal 
Register.
    The following corrections are made to FR Doc. No. 2013-8351, 
``Amendment to the International Traffic in Arms Regulations: Initial 
Implementation of Export Control Reform,'' published on April 16, 2013:

0
1. On page 22740, in the first column, in the heading, ``22 CFR Parts 
120, 121, and 123'' is corrected to read ``22 CFR Parts 120, 121, 123, 
and 126.''
0
2. On page 22740, in the third column, in the ``Changes in This Rule'' 
paragraph, ``(v)'' is changed to ``(vi),'' and a new ``(v)'' section is 
added as follows: ``(v) updating of Supplement No. 1 to part 126 to 
reflect the changes to the USML in this rule;''
0
3. Starting on page 22747, in the third column, through page 22751, in 
the first column, ``Transition Plan'' is revised to read as follows:

Transition Plan

    With the intention of establishing certain necessary licensing 
procedures stemming from ECR implementation and mitigating the impact 
of the changes involved in the revision of the USML and the CCL on U.S. 
license holders and the defense export industry, the Department 
implements the following ``Transition Plan,'' which will describe (1) 
timelines for implementation of changes, (2) certain temporary 
licensing procedures for items transitioning from the USML to the CCL, 
and 3) certain permanent licensing procedures pertaining to the export 
of any item ``subject to the EAR'' (see definition of this term in this 
rule) to be used in or with defense articles controlled on the USML.
    The Department notes the following main points regarding licensing 
procedure during the transition and thereafter:
     There will generally be a 180-day transition period 
between the publication of the final rule for each revised USML 
category and its effective date. This period will allow U.S. license 
holders time to review their current authorizations and prepare for the 
transition to the new Export Control Classification Numbers (ECCNs).
     A license application or other request for authorization 
containing only transitioning items or both USML and transitioning 
items will be accepted by the Department up until the effective date of 
the relevant revised USML category.
     A license or authorization issued by the Department will 
be effective for up to two years from the effective date of the revised 
USML category if all the items listed on the license or authorization 
have transitioned to the export jurisdiction of the Department of 
Commerce.
     A license or authorization issued by the Department will 
be valid until its expiration if some of the items listed on the 
license or authorization have transitioned to the export jurisdiction 
of the Department of Commerce.
     USML categories will have a new (x) paragraph, the purpose 
of which is to allow for Department of State licensing for commodities, 
software, and technical data subject to the EAR, provided those 
commodities, software, and technical data are to be used in or with 
defense articles controlled on the USML and are described in the 
purchase documentation submitted with the application.
    The Department first presented for public comment its plan for 
licensing policies and procedures regarding items moving from the 
export jurisdiction of the Department of State to the Department of 
Commerce on June 21, 2012 (see ``Export Control Reform Transition 
Plan,'' 77 FR 37346). The comment period ended August 6, 2012. 
Seventeen parties filed comments during the established comment period 
recommending changes. The Department's evaluation of the written 
comments and recommendations follows.
    Eight commenting parties stated that the proposed 45-day transition 
period was insufficient time to accomplish all that was necessary to 
adapt company systems to the changes and recommended longer transition 
periods of varying lengths. The Department has accepted the 
recommendation for a longer transition period, and has changed the 
effective date of revised USML categories to 180 days from the date of 
publication.
    In response to the recommendation of several commenting parties for 
shared licensing authority for items changing export jurisdiction, the 
Department's transition guidance will provide that, for 180 days 
following the publication date of a revised USML category, licenses for 
items moving from the USML to the CCL will be accepted by both DDTC and 
BIS. In addition, DDTC authorizations that pertain wholly to 
transitioned items will expire two years after the effective date of 
the relevant final rule moving the items to the CCL, and licenses that 
have some items remaining on the USML will be valid until expiration 
for all items covered by

[[Page 61751]]

the license at the time it was issued. Applicants should refer to the 
Department of Commerce's companion to this rule, which is published 
elsewhere in this issue of the Federal Register, for information 
related to BIS licenses during the transition period.
    Two commenting parties stated that dual jurisdiction/licensing will 
create a heavy compliance burden for USML end-item manufacturers with 
international supply chains, as each of the export authorities has 
different compliance obligations. The commenting parties also stated 
that it will create confusion as foreign parties may be party to a USML 
technical assistance agreement and receive items for the project under 
a Department of Commerce license or Strategic Trade Authorization (STA) 
license exception. The Department acknowledges this complexity, but 
notes that ECR will not create a new context in this regard, as current 
projects routinely require both defense articles and commercial items 
for completion. Dual compliance requirements already exist and the 
Department believes the benefits derived from changes implemented under 
ECR outweigh these concerns.
    One commenting party requested clarification of whether sending to 
a foreign supplier technical data on a USML end-item to allow 
installation of a 600 series component is both a USML technical data 
export and CCL installation technology export, creating dual licensing 
for most foreign sourced commodities. If the technical data is directly 
related to a defense article, the technical data will be ITAR 
controlled. If the technical data is for the production, development, 
etc., of a 600 series or CCL item to be installed in a defense article, 
the technical data remains EAR controlled. The jurisdiction of the 
technical data follows the jurisdiction of the related commodity or 
item.
    Five commenting parties recommended that amendments to licenses and 
authorizations that contain transitioning and non-transitioning items 
or solely transitioning items should be allowed during the transition 
period. The Department accepted this recommendation and revised the 
guidance to provide that such submissions will be accepted up until the 
effective date of the relevant revised USML category.
    Three commenting parties recommended allowing temporary import and 
export authorizations to last until expired or returned. As the items 
temporarily imported or exported are to return to their point of 
origin, pursuant to the requirements of the authorizations, there is no 
national security risk in maintaining the original authorizations. The 
Department accepted this recommendation and revised the guidance 
accordingly.
    One commenting party noted that currently approved agreements 
covering dual/third country national employees of the foreign party 
will be affected by the need to obtain deemed export licenses, and that 
two years may not be sufficient time to fulfill this requirement. The 
Department notes that as long as the currently approved agreement has 
been amended to provide authority for the transitioned items in 
accordance with the guidance in this notice, the dual/third country 
national authority would still apply.
    Five commenting parties recommended that existing reexport/
retransfer authorizations should be grandfathered without expiration. 
Foreign parties who purchased transitioned items under authorizations 
that allowed perpetual foreign sales should not have to reauthorize 
those sales and the U.S. Government should not re-review the 
authorizations. The Department accepted this recommendation and revised 
the guidance accordingly. The three scenarios for which this applies 
are: (1) Reexport/retransfer authority granted through a program status 
DSP-5; (2) the sales territory of a manufacturing license or warehouse 
and distribution agreement if the agreement continues to be the export 
authority; and (3) any stand-alone reexport/retransfer authorization 
received pursuant to ITAR Sec.  123.9(c).
    Two commenting parties recommended requiring U.S. exporters to 
identify ECCNs and prior USML classifications on export documentation 
for two years following the effective date of transitioned items and 
mandate prompt responses to requests for ECCNs for legacy items. The 
Department accepted this recommendation in part. The Department has 
revised ITAR Sec.  123.9(b) to require identification of the license or 
other approval to the foreign party.
    Seven commenting parties recommended that previously issued 
commodity jurisdiction (CJ) determinations designating items as not 
subject to the export jurisdiction of the Department remain valid. This 
will preserve EAR99 status for items previously so designated and would 
relieve exporters who have obtained CJ determinations from having to 
reclassify items. The Department accepted this recommendation and 
revised the guidance accordingly.
    One commenting party inquired what Automated Export System (AES) 
entry would be required for items that have transitioned to control 
under the CCL but are to be exported under a legacy DDTC authorization. 
The AES entry for such exports will remain the same as is required now 
for a DDTC authorization.
    In response to one commenting party's inquiry on what effect the 
transition will have on recordkeeping requirements, the Department 
notes records must be maintained for five years following the last 
transaction, regardless of jurisdiction.
    After consideration of the comments received, and in furtherance of 
the principles of ECR, the Department has decided to institute a new 
permanent licensing procedure that will allow DDTC licensing for 
commodities, software, and technical data subject to the EAR, provided 
those commodities, software, and technical data are to be used in or 
with defense articles controlled on the USML and are described in the 
purchase documentation submitted with the application. This procedure 
is to be effected by the exporter by use of ``(x) paragraph,'' added to 
USML Categories VIII and XIX in this rule, and to be added to other 
USML categories as they are revised. The Department will begin 
accepting licenses citing a (x) paragraph entry following the effective 
date of the relevant revised USML category. The President has provided 
for this delegation of authority from the Secretary of Commerce to the 
Secretary of State, and Executive Order 13222 has been amended 
accordingly (see 78 FR 16129). The Department has revised various 
sections of, and added certain sections to, the ITAR to accommodate 
this delegation of authority: ITAR Sec.  120.5 to add a new paragraph 
(b) to address the delegation; the addition of ITAR Sec.  120.42 to 
provide a definition of ``subject to the EAR''; ITAR Sec.  123.1 to 
provide guidance on how to use the (x) paragraph; and ITAR Sec.  
123.9(b) to identify additional requirements when using the (x) 
paragraph. The Department of Commerce has the authority to review 
``pre-positioned'' license applications during the 180-day transition 
period for items transitioning to EAR jurisdiction. This means the 
Department of Commerce will be able to review and process license 
applications for transitioning items. However, these Department of 
Commerce licenses would not be issued until the effective date of the 
relevant final rule moving items from the USML to the CCL. Further 
guidance is provided in the Department of Commerce's companion to this 
rule (see ``Revision to the Export

[[Page 61752]]

Administration Regulations: Initial Implementation of Export Control 
Reform,'' elsewhere in this edition of the Federal Register).

Transition Plan

Transition Period--General Policy
    There will generally be a 180-day transition period between the 
publication of the final rule for each revised U.S. Munitions List 
(USML) category and its effective date. This period will allow U.S. 
license holders time to review their current authorizations and prepare 
for the transition to the new ECCNs. A license application or other 
request for authorization containing only transitioning items or both 
USML and transitioning items will be accepted by the Department up 
until the effective date of the relevant revised USML category. A 
license or authorization issued by the Department will be effective for 
up to two years from the effective date of the revised USML category if 
all the items listed on the license or authorization have transitioned 
to the export jurisdiction of the Department of Commerce. A license or 
authorization issued by the Department will be valid until its 
expiration if some of the items listed on the license or authorization 
have transitioned to the export jurisdiction of the Department of 
Commerce. During this period, BIS will accept license applications for 
items moving from the USML to the CCL, but it will not issue licenses 
for such items until the applicable effective date.
DSP-5 Licenses
    Approvals issued for licenses submitted prior to the effective date 
of the relevant revised USML category that do not include any items 
that will remain on the USML will remain valid until expired, returned 
by the license holder, or for a period of two years from the effective 
date of the final rule, whichever occurs first, unless otherwise 
revoked, suspended, or terminated. Licenses containing both 
transitioning and non-transitioning items (mixed authorizations) will 
remain valid until expired or returned by the license holder, unless 
otherwise revoked, suspended, or terminated. Any limitation, proviso, 
or other requirement imposed on the DDTC authorization will remain in 
effect if the DDTC authorization is relied upon for export. License 
amendment requests (DSP-6) received by DDTC during the transition 
period amending licenses affected by the transition will be adjudicated 
on a case-by-case basis up until the effective date of the relevant 
rule.
DSP-61 and DSP-73 Licenses
    All temporary licenses that are issued in the period prior to the 
effective date of the final rule for each revised USML category will 
remain valid until expired or returned by the license holder, unless 
otherwise revoked, suspended, or terminated. Any limitation, proviso, 
or other requirement imposed on the DDTC authorization will remain in 
effect if the DDTC authorization is relied upon for export. License 
amendment requests (DSP-62 and DSP-74) received by DDTC during the 
transition period amending licenses affected by the transition will be 
adjudicated on a case-by-case basis until the effective date of the 
relevant rule.
License Applications Received After the Transition Period
    All license applications, including amendments, received after the 
effective date for items that have transitioned to the CCL that are not 
identified in a (x) paragraph entry will be Returned Without Action 
with instructions to contact the Department of Commerce.
Technical Assistance Agreements, Manufacturing License Agreements, 
Warehouse and Distribution Agreements, and Related Reporting 
Requirements
    Approvals issued for agreements submitted prior to the effective 
date of the relevant revised USML category that contain transitioning 
and non-transitioning items will remain valid until expired, unless 
they require an amendment, or for a period of two years from the 
effective date of the relevant final rule, whichever occurs first, 
unless otherwise revoked, suspended, or terminated. In order for an 
agreement to remain valid beyond two years, an amendment must be 
submitted to authorize the CCL items using the new (x) paragraph from 
the relevant USML category. Any activity conducted under an agreement 
will remain subject to all limitations, provisos, and other 
requirements stipulated in the agreement.
    Approvals issued for agreements submitted prior to the effective 
date of the relevant revised USML category that contain solely 
transitioning items will remain valid for a period of two years from 
the effective date of the relevant USML category, unless revoked, 
suspended, or terminated. After the two year period ends, any on-going 
activity must be conducted under the appropriate Department of Commerce 
authorization. Agreements and agreement amendments solely for items 
moving to the CCL which are received after the effective date will be 
Returned Without Action with instructions to contact the Department of 
Commerce.
    All reporting requirements for Manufacturing License Agreements 
under ITAR Sec.  124.9(a)(6) and Warehouse and Distribution Agreements 
under ITAR Sec.  124.14(c)(6) must be complied with and such reports 
must be submitted to the Department of State while the agreement is 
relied upon as an export authorization by the exporter.
ITAR Licensing of Items Subject to the EAR
    USML categories will have a new (x) paragraph, to be a permanent 
feature of ITAR licensing. The purpose of this procedure is to allow 
for ITAR licensing for commodities, software, and technical data 
subject to the Export Administration Regulations (EAR) provided those 
commodities, software, and technical data are to be used in or with 
defense articles controlled on the USML and are described in the 
purchase documentation submitted with the application.
Commodity Jurisdiction Determinations
    Previously issued commodity jurisdiction (CJ) determinations for 
items deemed to be subject to the EAR shall remain valid. Previously 
issued CJ determinations for items deemed to be USML but that are 
subsequently transitioning to the CCL pursuant to a published final 
rule will be superseded by the newly revised lists. Exporters are 
encouraged to review each revised USML category along with its 
companion CCL category to determine whether the items subject to a CJ 
have transitioned to the jurisdiction of the Department of Commerce. 
These CJs are limited to the specific commodity identified in the final 
determination letter. Consistent with the recordkeeping requirements of 
the ITAR and the EAR, licensees and foreign persons subject to licenses 
must maintain records reflecting their assessments of the proper 
regulatory jurisdiction over their items. License holders unable to 
ascertain the proper jurisdiction of their items may request a CJ 
determination from DDTC through the established procedure.
    License holders who are certain their items have transitioned to 
the CCL are encouraged to review the appropriate ECCN to determine the 
classification of their item. License holders who are unsure of the 
proper ECCN designation may submit a Commodity Classification Automated 
Tracking System request

[[Page 61753]]

(CCATS) to the Department of Commerce. See 15 CFR 748.3.
    As described in EAR Sec.  748.3(b)(3), parties making 
classification self-determinations or submitting CCATS requests are 
reminded that such determinations may not be relied upon or cited as 
evidence that the U.S. Government has determined that the item is not 
subject to the ITAR. As described in ITAR Sec.  120.5, an item that is 
described on the USML is ITAR controlled regardless of whether it also 
within the scope of an ECCN or referred to in a CCATS.
Reexport/Retransfer of USML Items That Have Transitioned to the CCL
    Following the effective date of transition, foreign persons (i.e., 
end-users, foreign consignees, and foreign intermediate consignees) who 
receive, via a Department of State authorization, an item that they are 
certain has transitioned to the CCL (e.g., confirmed in writing by 
manufacturer or supplier), should treat the item as such and submit 
requests for post-transition reexports or retransfers outside the scope 
of the original ITAR authorization to the Department of Commerce, as 
may be required by the EAR.
    If reexport or retransfer was previously authorized under a DDTC 
authorization, then that reexport or retransfer authority remains 
valid. The three scenarios for which this applies are: (1) Reexport/
retransfer authority granted through a program status DSP-5; (2) the 
sales/distribution territory of a manufacturing license or warehouse 
and distribution agreement if the agreement continues to provide the 
export authority; or (3) any stand-alone reexport/retransfer 
authorization received pursuant to ITAR Sec.  123.9.
    Foreign persons or U.S. persons abroad that have USML items in 
their inventory at the effective date of transition should review both 
the USML and the CCL to determine the proper jurisdiction. If the item 
is controlled by the Department of Commerce, any reexport or retransfer 
must comply with the requirements of the EAR. If doubt exists on 
jurisdiction of the items, the foreign person should contact the 
original exporter or manufacturer.
Regulatory Oversight Responsibilities
    For those items transitioning from the USML to the CCL, the 
Department of Commerce will exercise regulatory oversight, as of the 
effective date, for the purposes of licensing and enforcement of 
exports from the United States where no Department of State 
authorization is being used. The Department of State will continue to 
exercise regulatory oversight concerning all Department of State 
licenses, agreements, and other authorizations, including those where 
exporters, temporary importers, manufacturers, and brokers continue to 
use previously issued Department of State licenses and agreements, 
until the activity is covered by a Department of Commerce 
authorization.
    License holders may decide to apply for and use Department of 
Commerce authorizations for export of the newly transitioned CCL items 
rather than continue to use previously issued Department of State 
authorizations. In such cases, license holders must return the 
Department of State licenses in accordance with ITAR Sec.  123.22 after 
they have obtained the required Department of Commerce authorizations.
Violations and Voluntary Disclosures of Possible Violations
    Exporters, temporary importers, manufacturers, and brokers are 
cautioned to closely monitor ITAR and EAR compliance concerning 
Department of State licenses and agreements for items transitioning 
from the USML to the CCL.
    On the effective date of each rule that adds an item to the CCL 
that was previously subject to the ITAR, that item will be subject to 
the EAR. Approvals issued by DDTC for license applications and other 
authorization requests may continue to be used as described above by 
exporters, temporary importers, manufacturers, and brokers. The 
violation of a previously issued DDTC authorization (including any 
condition of a DDTC authorization) that is continued to be used as 
described above is a violation of the ITAR.
    With respect to a transitioned item, persons who discover a 
possible violation of the ITAR, the EAR, or any license or 
authorization issued thereunder, are strongly encouraged to disclose 
this violation to DDTC, BIS, or both offices, as appropriate, pursuant 
to established procedures for submitting voluntary disclosures.
    License holders and foreign persons must obtain Department of State 
authorization before disposing, reselling, transshipping, or otherwise 
transferring any item in their possession that remains on the USML.
Registration
    With few exceptions, manufacturers, exporters, and brokers are 
required to register with the Department of State if their activities 
involve USML defense articles or defense services.
    Registered manufacturers, exporters, temporary importers, defense 
service providers and brokers (``registrants'') are reminded of the 
requirement to notify DDTC in writing when they are no longer in the 
business of manufacturing, exporting, or brokering USML defense 
articles or defense services. Registrants who determine that all of 
their activities involve articles or services that will transition from 
the USML to the CCL and therefore are no longer required to register 
with the Department of State must provide such written notification to 
the Department of State. Instructions for providing such notification 
are accessible on the DDTC Web site (www.pmddtc.state.gov). Note that 
DDTC will not cancel or revoke those registrations, but will allow the 
registrations to expire. Registrants who determine that all of their 
activities will be subject to Department of Commerce jurisdiction as a 
result of the transition from the USML to the CCL must nevertheless 
maintain registration with the Department of State until the effective 
date of the applicable final rule transitioning the registrant's items 
to the CCL.
    Registrants who determine they will no longer be required to 
register with the Department of State after the effective date of the 
final rule transitioning the registrant's items to the CCL, and who 
have registration renewal dates that occur after publication of the 
final rule but before its effective date, may request to have their 
registration expiration date extended to the effective date of 
transition and not be charged a registration fee. In those cases, 
registrants must insert the following statement as the first paragraph 
in the written notification previously mentioned: ``(insert company 
name) requests DDTC extend our registration expiration date to the 
effective date of transition to CCL for USML Category (insert Category 
number) items and waive the registration fee. (insert company name) 
certifies that no changes in our eligibility from what is represented 
in our previously submitted DS-2032 Statement of Registration has 
occurred (otherwise specify change in eligibility status).'' If a 
registrant subsequently determines that its registration with the 
Department of State must instead be renewed, the registration renewal 
fee will be recalculated to include any Department of State licenses 
the registrant received during the period when the registration 
expiration date was extended.
    Registrants that avail themselves of the opportunity to continue 
using previously issued Department of State authorizations (licenses 
and agreements) for items that have transitioned to the CCL must 
maintain current registration

[[Page 61754]]

with the Department of State, which includes payment of registration 
fees.
0
4. On page 22751, in the second column, as a new last paragraph to the 
``Additional Required Changes'' section, the following is added: 
``Supplement No. 1 to part 126 is revised in conformance with the 
revisions of USML Categories VIII, XVII, and XXI and addition of USML 
Category XIX.''
0
5. On page 22752, in the third column, the list of subjects and the 
words of issuance are corrected to read as follows:

List of Subjects

22 CFR Parts 120 and 121

    Arms and munitions, Classified information, Exports.

22 CFR Part 123

    Arms and munitions, Exports, Reporting and recordkeeping 
requirements.

22 CFR Part 126

    Arms and munitions, Exports.
    ``Accordingly, for the reasons set forth above, Title 22, Chapter 
I, Subchapter M, parts 120, 121, 123, and 126 are amended as follows.''

PART 120 [CORRECTED]


Sec.  120.5  [Corrected]

0
6. On page 22753, in the third column, in paragraph (a), in the 
sentence beginning, ``In carrying out the functions delegated to the 
Attorney General . . .,'' the comma after ``security'' is removed. In 
the sentence beginning, ``The Department of Commerce regulates the 
export . . .,'' ``(CCL)'' is removed.


Sec.  120.10  [Corrected]

0
7. On page 22754, in the first column, in paragraph (b), commas are 
placed after ``mathematical'' and ``colleges,'' and ``of this 
subchapter'' is placed after ``Sec.  120.11.''


Sec.  120.29  [Corrected]

0
8. On page 22754, in the first column, in paragraph (a), ``among'' 
replaces ``between.''


Sec.  120.41  [Corrected]

0
9. On page 22754, in the second column, in paragraph (a) introductory 
text, the quotations are removed from ``specially designed.'' Paragraph 
(b) introductory text is removed and replaced with, ``For purposes of 
this subchapter, a part, component, accessory, attachment, or software 
is not specially designed if it:'' ``Note 1 to paragraph (a)'' is 
removed. ``Note 2 to paragraph (a)'' is re-titled, ``Note to paragraphs 
(a) and (b).'' In the third column, in ``Note to paragraph (b),'' the 
following is added as a first sentence: ``The term ``enumerated'' 
refers to any article on the U.S. Munitions List or the Commerce 
Control List and not in a ``catch-all'' paragraph.'' The last sentence 
in the note is replaced with the following: ``For the purposes of the 
U.S. Munitions List, a ``catch-all'' paragraph includes the phrases 
``and specially designed parts and components therefor,'' or ``(parts, 
components, accessories, attachments, and associated equipment) 
specially designed for/to/with.'' The text for ``Note 4 to paragraph 
(b)(3)'' is removed and replaced with the following text: ``The form of 
a commodity is defined by its configuration (including the 
geometrically measured configuration), material, and material 
properties that uniquely characterize it. The fit of a commodity is 
defined by its ability to physically interface or connect with or 
become an integral part of another commodity. The function of a 
commodity is the action or actions it is designed to perform. 
Performance capability is the measure of a commodity's effectiveness to 
perform a designated function in a given environment (e.g., measured in 
terms of speed, durability, reliability, pressure, accuracy, 
efficiency). For software, the form means the design, logic flow, and 
algorithms. The fit is defined by its ability to interface or connect 
with a defense article. The function means the action or actions the 
software performs directly related to a defense article or as a 
standalone application. Performance capability means the measure of the 
software's effectiveness to perform a designated function.'' After 
``Note 4 to paragraph (b)(3),'' the following new note is added: ``Note 
5 to paragraph (b)(3): With respect to a commodity, ``equivalent'' 
means its form has been modified solely for fit purposes.''

PART 121 [CORRECTED]


Sec.  121.1  [Corrected]

0
10. On page 22755, in the second column, in paragraph (b)(3), the 
following is removed: ``The asterisk is placed as a convenience to help 
identify such defense articles.''
    In the third column, in Category VIII,'' in paragraphs (a)(5), (6), 
(10), and (13), the quotation marks are removed from ``range.'' ``Note 
1 to paragraph (a)'' is re-titled, ``Note to paragraph (a).'' In the 
note, the quotation marks are removed from the second, third, and 
fourth occurrences of ``range.'' On page 22756, in the first column, in 
paragraph (d), the quotation marks are removed from ``range.'' The 
following is added as a second sentence in ``Note to paragraph d'': 
``For the definition of ``range,'' see note to paragraph (a) of this 
category.'' The text of paragraph (f) is removed and replaced with the 
following text: ``Developmental aircraft funded by the Department of 
Defense via contract or other funding authorization, and specially 
designed parts, components, accessories, and attachments therefor.'' 
``Note 1 to paragraph VIII(f)'' is re-titled, ``Note 1 to paragraph 
(f).'' In the note text, ``VIII'' and ``developmental'' are removed 
from the introductory sentence, ``in production; (b)'' is placed 
between ``(a)'' and ``determined,'' a comma is placed after ``(see 
Sec.  120.4 of this subchapter),'' ``(b)'' is replaced by ``(c),'' and 
``or other funding authorization'' is placed between ``contract'' and 
``as.'' ``Note 2 to paragraph VIII(f)'' is re-titled, ``Note 2 to 
paragraph (f).'' A new note is added after ``Note 2 to paragraph (f),'' 
as follows: ``Note 3 to paragraph (f): This provision is applicable to 
those contracts or other funding authorizations that are dated April 
16, 2014, or later.'' A new note is added after paragraph (h)(1), as 
follows: ``Note to paragraph (h)(1): Specially designed (see Sec.  
120.4(b)(3)(ii) of this subchapter) does not control parts, components, 
accessories, and attachments that are common to aircraft enumerated in 
paragraph (a) of this category but not identified in paragraph (h)(1), 
and those identified in paragraph (h)(1). For example, a part common to 
only the F-14 and F-35 is not specially designed for purposes of the 
ITAR. A part common to only the F-22 and F-35--two aircraft models 
identified in paragraph (h)(1)--is specially designed.'' In the second 
column, in paragraph (h)(2), a comma is placed after ``lubrication.'' 
In paragraph (h)(3), a comma is placed after ``systems.'' In paragraph 
(h)(5), a comma is placed after ``gear.'' In paragraph (h)(11), a comma 
is placed after the second occurrence of ``systems.'' In the third 
column, in paragraph (h)(20)(ii), ``directly related to defense 
articles in this subchapter or 600 series items subject to the EAR'' is 
placed after ``software.'' In paragraph (h)(20)(iii), ``(see Sec.  
120.10(a)(2) of this subchapter)'' is placed after ``information.''
    On page 22757, in the second column, in Category XIX, paragraph 
(e), the quotation marks are removed from ``range.'' In ``Note to 
paragraph (e), the following is added as a second sentence: ``For the 
definition of ``range,'' see note to paragraph (a) of USML Category 
VIII.'' In the third column, in paragraph

[[Page 61755]]

(f)(6)(ii), ``directly related to defense articles in this subchapter 
or 600 series items subject to the EAR'' is added after ``software.'' 
In paragraph (f)(6)(iii), ``(see Sec.  120.10(a)(2) of this 
subchapter)'' is added after ``information.''


Sec.  121.2  [Corrected]

0
11. On page 22758, in the first column, a period is placed after the 
section header.


Sec.  121.3  [Corrected]

0
12. On page 22758, in the first column, in paragraph (a) introductory 
text, ``USML'' is added in between ``In'' and ``Category.'' In 
paragraph (a)(6), the quotation marks are removed from the first 
occurrence of ``mission system'' and from ``system.''

PART 123 [CORRECTED]

0
13. On page 22758, in the second column, ``The authority citation for 
part 123 is revised to read as follows'' is corrected to read ``The 
authority citation for part 123 continues to read as follows.'' ``Sec. 
520, Pub. L. 112-55'' is placed between ``Sec. 1205(a), Pub. L. 107-
228;'' and ``Section 1261, Pub. L. 112-239.''


Sec.  123.9  [Corrected]

0
14. On page 22759, in the third column, in paragraph (b)(2), ``(see 
Sec. Sec.  120.42 and 123.1(b)'' is corrected to read ``(see Sec. Sec.  
120.42 and 123.1(b) of this subchapter),'' and ``submitted with the 
Department of State license or other approval request'' is added 
between ``support documentation'' and ``the appropriate EAR 
classification.''

PART 126 [CORRECTED]

0
15. On page 22759, at the end of column three, before the signature, 
add the following amendments:

PART 126--GENERAL POLICIES AND PROVISIONS

0
20. The authority citation for part 126 continues to read as follows:

    Authority:  Secs. 2, 38, 40, 42, and 71, Pub. L. 90-629, 90 
Stat. 744 (22 U.S.C. 2752, 2778, 2780, 2791, and 2797); 22 U.S.C. 
2651a; 22 U.S.C. 287c; E.O. 12918, 59 FR 28205; 3 CFR, 1994 Comp., 
p. 899; Sec. 1225, Pub. L. 108-375; Sec. 7089, Pub. L. 111-117; Pub. 
L. 111-266; Sections 7045 and 7046, Pub. L. 112-74; E.O. 13637, 78 
FR 16129.

0
21. Supplement No. 1 to part 126 is revised to read as follows:

                                                Supplement No. 1*
----------------------------------------------------------------------------------------------------------------
                                                                          (CA) Sec.     (AS) Sec.     (UK) Sec.
              USML Category                         Exclusion               126.5        126.16        126.17
----------------------------------------------------------------------------------------------------------------
I-XXI...................................  Classified defense articles             X             X             X
                                           and services. See Note 1.
I-XXI...................................  Defense articles listed in              X             X             X
                                           the Missile Technology
                                           Control Regime (MTCR) Annex.
I-XXI...................................  U.S. origin defense articles  ............            X             X
                                           and services used for
                                           marketing purposes and not
                                           previously licensed for
                                           export in accordance with
                                           this subchapter.
I-XXI...................................  Defense services for or                 X   ............  ............
                                           technical data related to
                                           defense articles identified
                                           in this supplement as
                                           excluded from the Canadian
                                           exemption.
I-XXI...................................  Any transaction involving               X   ............  ............
                                           the export of defense
                                           articles and services for
                                           which congressional
                                           notification is required in
                                           accordance with Sec.
                                           123.15 and Sec.   124.11 of
                                           this subchapter.
I-XXI...................................  U.S. origin defense articles  ............            X             X
                                           and services specific to
                                           developmental systems that
                                           have not obtained written
                                           Milestone B approval from
                                           the U.S. Department of
                                           Defense milestone approval
                                           authority, unless such
                                           export is pursuant to a
                                           written solicitation or
                                           contract issued or awarded
                                           by the U.S. Department of
                                           Defense for an end-use
                                           identified in paragraph
                                           (e)(1), (e)(2), or (e)(4)
                                           of Sec.   126.16 or Sec.
                                           126.17 of this subchapter
                                           and is consistent with
                                           other exclusions of this
                                           supplement.
I-XXI...................................  Nuclear weapons strategic               X   ............  ............
                                           delivery systems and all
                                           components, parts,
                                           accessories, and
                                           attachments specifically
                                           designed for such systems
                                           and associated equipment.
I-XXI...................................  Defense articles and          ............            X             X
                                           services specific to the
                                           existence or method of
                                           compliance with anti-tamper
                                           measures, where such
                                           measures are readily
                                           identifiable, made at
                                           originating Government
                                           direction.
I-XXI...................................  Defense articles and          ............            X             X
                                           services specific to
                                           reduced observables or
                                           counter low observables in
                                           any part of the spectrum.
                                           See Note 2.
I-XXI...................................  Defense articles and          ............            X             X
                                           services specific to sensor
                                           fusion beyond that required
                                           for display or
                                           identification correlation.
                                           See Note 3.
I-XXI...................................  Defense articles and          ............            X             X
                                           services specific to the
                                           automatic target
                                           acquisition or recognition
                                           and cueing of multiple
                                           autonomous unmanned systems.
I-XXI...................................  Nuclear power generating      ............  ............            X
                                           equipment or propulsion
                                           equipment (e.g., nuclear
                                           reactors), specifically
                                           designed for military use
                                           and components therefore,
                                           specifically designed for
                                           military use. See also Sec.
                                             123.20 of this subchapter.
I-XXI...................................  Libraries (parametric         ............  ............            X
                                           technical databases)
                                           specially designed for
                                           military use with equipment
                                           controlled on the USML. See
                                           Note 13.
I-XXI...................................  Defense services or                     X   ............  ............
                                           technical data specific to
                                           applied research as defined
                                           in Sec.   125.4(c)(3) of
                                           this subchapter, design
                                           methodology as defined in
                                           Sec.   125.4(c)(4) of this
                                           subchapter, engineering
                                           analysis as defined in Sec.
                                             125.4(c)(5) of this
                                           subchapter, or
                                           manufacturing know-how as
                                           defined in Sec.
                                           125.4(c)(6) of this
                                           subchapter. See Note 12.

[[Page 61756]]

 
I-XXI...................................  Defense services other than             X   ............  ............
                                           those required to prepare a
                                           quote or bid proposal in
                                           response to a written
                                           request from a department
                                           or agency of the United
                                           States Federal Government
                                           or from a Canadian Federal,
                                           Provincial, or Territorial
                                           Government; or defense
                                           services other than those
                                           required to produce,
                                           design, assemble, maintain
                                           or service a defense
                                           article for use by a
                                           registered U.S. company, or
                                           a U.S. Federal Government
                                           Program, or for end-use in
                                           a Canadian Federal,
                                           Provincial, or Territorial
                                           Government Program. See
                                           Note 14.
I.......................................  Firearms, close assault                 X   ............  ............
                                           weapons, and combat
                                           shotguns.
II(k)...................................  Software source code related  ............            X             X
                                           to USML Category II(c),
                                           II(d), or II(i). See Note 4.
II(k)...................................  Manufacturing know-how                  X             X             X
                                           related to USML Category
                                           II(d). See Note 5.
III.....................................  Ammunition for firearms,                X   ............  ............
                                           close assault weapons, and
                                           combat shotguns listed in
                                           USML Category I.
III.....................................  Defense articles and          ............  ............            X
                                           services specific to
                                           ammunition and fuse setting
                                           devices for guns and
                                           armament controlled in USML
                                           Category II.
III(e)..................................  Manufacturing know-how                  X             X             X
                                           related to USML Category
                                           III(d)(1) or III(d)(2) and
                                           their specially designed
                                           components. See Note 5.
III(e)..................................  Software source code related  ............            X             X
                                           to USML Category III(d)(1)
                                           or III(d)(2). See Note 4.
IV......................................  Defense articles and                    X             X             X
                                           services specific to man-
                                           portable air defense
                                           systems (MANPADS). See Note
                                           6.
IV......................................  Defense articles and          ............  ............            X
                                           services specific to
                                           rockets, designed or
                                           modified for non-military
                                           applications that do not
                                           have a range of 300 km
                                           (i.e., not controlled on
                                           the MTCR Annex).
IV......................................  Defense articles and          ............            X             X
                                           services specific to
                                           torpedoes.
IV......................................  Defense articles and                    X             X             X
                                           services specific to anti-
                                           personnel landmines. See
                                           Note 15.
IV......................................  Defense articles and                    X             X             X
                                           services specific to
                                           cluster munitions. See Note
                                           16.
IV(i)...................................  Software source code related  ............            X             X
                                           to USML Category IV(a),
                                           IV(b), IV(c), or IV(g). See
                                           Note 4.
IV(i)...................................  Manufacturing know-how                  X             X             X
                                           related to USML Category
                                           IV(a), IV(b), IV(d), or
                                           IV(g) and their specially
                                           designed components. See
                                           Note 5.
V.......................................  The following energetic       ............  ............            X
                                           materials and related
                                           substances:.
                                          a. TATB
                                           (triaminotrinitrobenzene)
                                           (CAS 3058-38-6);
                                          b. Explosives controlled in
                                           USML Category V(a)(32) or
                                           V(a)(33);.
                                          c. Iron powder (CAS 7439-89-
                                           6) with particle size of 3
                                           micrometers or less
                                           produced by reduction of
                                           iron oxide with hydrogen;.
                                          d. BOBBA-8 (bis(2-
                                           methylaziridinyl)2-(2-
                                           hydroxypropanoxy)
                                           propylamino phosphine
                                           oxide), and other MAPO
                                           derivatives;.
                                          e. N-methyl-p-nitroaniline
                                           (CAS 100-15-2); or.
                                          f. Trinitrophenylmethylni-
                                           tramine (tetryl) (CAS 479-
                                           45-8).
V(c)(7).................................  Pyrotechnics and pyrophorics  ............  ............            X
                                           specifically formulated for
                                           military purposes to
                                           enhance or control radiated
                                           energy in any part of the
                                           IR spectrum.
V(d)(3).................................  Bis-2, 2-                     ............  ............            X
                                           dinitropropylnitrate
                                           (BDNPN).
VI......................................  Defense articles specific to  ............  ............            X
                                           cryogenic equipment, and
                                           specially designed
                                           components or accessories
                                           therefor, specially
                                           designed or configured to
                                           be installed in a vehicle
                                           for military ground,
                                           marine, airborne or space
                                           applications, capable of
                                           operating while in motion
                                           and of producing or
                                           maintaining temperatures
                                           below 103 K (-170 [deg]C).
VI......................................  Defense Articles specific to  ............  ............            X
                                           superconductive electrical
                                           equipment (rotating
                                           machinery and transformers)
                                           specially designed or
                                           configured to be installed
                                           in a vehicle for military
                                           ground, marine, airborne,
                                           or space applications and
                                           capable of operating while
                                           in motion. This, however,
                                           does not include direct
                                           current hybrid homopolar
                                           generators that have single-
                                           pole normal metal armatures
                                           which rotate in a magnetic
                                           field produced by
                                           superconducting windings,
                                           provided those windings are
                                           the only superconducting
                                           component in the generator.
VI......................................  Defense articles and          ............            X             X
                                           services specific to naval
                                           technology and systems
                                           relating to acoustic
                                           spectrum control and
                                           awareness. See Note 10.
VI(a)...................................  Nuclear powered vessels.....            X             X             X
VI(c)...................................  Defense articles and          ............            X             X
                                           services specific to
                                           submarine combat control
                                           systems.
VI(d)...................................  Harbor entrance detection     ............  ............            X
                                           devices.
VI(e)...................................  Defense articles and                    X             X             X
                                           services specific to naval
                                           nuclear propulsion
                                           equipment. See Note 7.
VI(g)...................................  Software source code related  ............            X             X
                                           to USML Category VI(a) or
                                           VI(c). See Note 4.
VII.....................................  Defense articles specific to  ............  ............            X
                                           cryogenic equipment, and
                                           specially designed
                                           components or accessories
                                           therefor, specially
                                           designed or configured to
                                           be installed in a vehicle
                                           for military ground,
                                           marine, airborne or space
                                           applications, capable of
                                           operating while in motion
                                           and of producing or
                                           maintaining temperatures
                                           below 103 K (-170 [deg]C).

[[Page 61757]]

 
VII.....................................  Defense articles specific to  ............  ............            X
                                           superconductive electrical
                                           equipment (rotating
                                           machinery and transformers)
                                           specially designed or
                                           configured to be installed
                                           in a vehicle for military
                                           ground, marine, airborne,
                                           or space applications and
                                           capable of operating while
                                           in motion. This, however,
                                           does not include direct
                                           current hybrid homopolar
                                           generators that have single-
                                           pole normal metal armatures
                                           which rotate in a magnetic
                                           field produced by
                                           superconducting windings,
                                           provided those windings are
                                           the only superconducting
                                           component in the generator.
VII.....................................  Armored all wheel drive       ............  ............            X
                                           vehicles fitted with, or
                                           designed or modified to be
                                           fitted with, a plough or
                                           flail for the purpose of
                                           land mine clearance, other
                                           than vehicles specifically
                                           designed or modified for
                                           military use.
VII(e)..................................  Amphibious vehicles.........  ............  ............            X
VII(f)..................................  Technical data and defense              X             X             X
                                           services for gas turbine
                                           engine hot sections. See
                                           Note 8.
VIII....................................  Defense articles specific to  ............  ............            X
                                           cryogenic equipment, and
                                           specially designed
                                           components and accessories
                                           therefor, specially
                                           designed or configured to
                                           be installed in a vehicle
                                           for military ground,
                                           marine, airborne or space
                                           applications, capable of
                                           operating while in motion
                                           and of producing or
                                           maintaining temperatures
                                           below 103 K (-170 [deg]C).
VIII....................................  Defense articles specific to  ............  ............            X
                                           superconductive electrical
                                           equipment (rotating
                                           machinery and transformers)
                                           specially designed or
                                           configured to be installed
                                           in a vehicle for military
                                           ground, marine, airborne,
                                           or space applications and
                                           capable of operating while
                                           in motion. This, however,
                                           does not include direct
                                           current hybrid homopolar
                                           generators that have single-
                                           pole normal metal armatures
                                           which rotate in a magnetic
                                           field produced by
                                           superconducting windings,
                                           provided those windings are
                                           the only superconducting
                                           component in the generator.
VIII(a).................................  All USML Category VIII(a)               X   ............  ............
                                           items.
VIII(f).................................  Developmental aircraft                  X   ............  ............
                                           parts, components,
                                           accessories, and
                                           attachments identified in
                                           USML Category VIII(f).
VIII(i).................................  Manufacturing know-how                  X             X             X
                                           related to USML Category
                                           VIII(a) or VIII(e), and
                                           specially designed parts or
                                           components therefor. See
                                           Note 5.
VIII(i).................................  Software source code related  ............            X             X
                                           to USML Category VIII(a) or
                                           VIII(e). See Note 4.
IX......................................  Training or simulation        ............            X             X
                                           equipment for Man Portable
                                           Air Defense Systems
                                           (MANPADS). See Note 6.
IX(e)...................................  Software source code related  ............            X             X
                                           to USML Category IX(a) or
                                           IX(b). See Note 4.
IX(e)...................................  Software that is both         ............  ............            X
                                           specifically designed or
                                           modified for military use
                                           and specifically designed
                                           or modified for modeling or
                                           simulating military
                                           operational scenarios.
X(e)....................................  Manufacturing know-how                  X             X             X
                                           related to USML Category
                                           X(a)(1) or X(a)(2), and
                                           specially designed
                                           components therefor. See
                                           Note 5.
XI(a)...................................  Defense articles and          ............            X             X
                                           services specific to
                                           countermeasures and counter-
                                            countermeasures See Note 9.
XI(a)...................................  High Frequency and Phased     ............            X   ............
                                           Array Microwave Radar
                                           systems, with capabilities
                                           such as search,
                                           acquisition, tracking,
                                           moving target indication,
                                           and imaging radar systems.
                                           See Note 17.
XI......................................  Defense articles and          ............            X             X
                                           services specific to naval
                                           technology and systems
                                           relating to acoustic
                                           spectrum control and
                                           awareness. See Note 10.
XI(b), XI(c), XI(d).....................  Defense articles and          ............            X             X
                                           services specific to USML
                                           Category XI (b) (e.g.,
                                           communications security
                                           (COMSEC) and TEMPEST).
XI(d)...................................  Software source code related  ............            X             X
                                           to USML Category XI(a). See
                                           Note 4.
XI(d)...................................  Manufacturing know-how                  X             X             X
                                           related to USML Category
                                           XI(a)(3) or XI(a)(4), and
                                           specially designed
                                           components therefor. See
                                           Note 5.
XII.....................................  Defense articles and          ............            X             X
                                           services specific to
                                           countermeasures and counter-
                                            countermeasures. See Note
                                           9.
XII.....................................  Defense articles and                    X   ............  ............
                                           services specific to USML
                                           Category XII(c) articles,
                                           except any 1st- and 2nd-
                                           generation image
                                           intensification tubes and
                                           1st- and 2nd-generation
                                           image intensification night
                                           sighting equipment. End-
                                           items in USML Category
                                           XII(c) and related
                                           technical data limited to
                                           basic operations,
                                           maintenance, and training
                                           information as authorized
                                           under the exemption in Sec.
                                             125.4(b)(5) of this
                                           subchapter may be exported
                                           directly to a Canadian
                                           Government entity (i.e.,
                                           federal, provincial,
                                           territorial, or municipal)
                                           consistent with Sec.
                                           126.5, other exclusions,
                                           and the provisions of this
                                           subchapter.

[[Page 61758]]

 
XII.....................................  Technical data or defense               X             X             X
                                           services for night vision
                                           equipment beyond basic
                                           operations, maintenance,
                                           and training data. However,
                                           the AS and UK Treaty
                                           exemptions apply when such
                                           export is pursuant to a
                                           written solicitation or
                                           contract issued or awarded
                                           by the U.S. Department of
                                           Defense for an end-use
                                           identified in paragraph
                                           (e)(1), (e)(2), or (e)(4)
                                           of Sec.   126.16 or Sec.
                                           126.17 of this subchapter
                                           and is consistent with
                                           other exclusions of this
                                           supplement.
XII(f)..................................  Manufacturing know-how                  X             X             X
                                           related to USML Category
                                           XII(d) and specially
                                           designed components
                                           therefor. See Note 5.
XII(f)..................................  Software source code related  ............            X             X
                                           to USML Category XII(a),
                                           XII(b), XII(c), or XII(d).
                                           See Note 4.
XIII(b).................................  Defense articles and          ............            X             X
                                           services specific to USML
                                           Category XIII(b) (Military
                                           Information Security
                                           Assurance Systems).
XIII(d).................................  Carbon/carbon billets and     ............  ............            X
                                           preforms which are
                                           reinforced in three or more
                                           dimensional planes,
                                           specifically designed,
                                           developed, modified,
                                           configured or adapted for
                                           defense articles.
XIII(e).................................  Defense articles and          ............  ............            X
                                           services specific to
                                           armored plate manufactured
                                           to comply with a military
                                           standard or specification
                                           or suitable for military
                                           use. See Note 11.
XIII(f).................................  Structural materials          ............  ............            X
                                           specifically designed,
                                           developed, modified,
                                           configured or adapted for
                                           defense articles.
XIII(g).................................  Defense articles and          ............  ............            X
                                           services related to
                                           concealment and deception
                                           equipment and materials.
XIII(h).................................  Energy conversion devices     ............  ............            X
                                           other than fuel cells.
XIII(i).................................  Metal embrittling agents....  ............  ............            X
XIII(j).................................  Defense articles and          ............            X             X
                                           services related to
                                           hardware associated with
                                           the measurement or
                                           modification of system
                                           signatures for detection of
                                           defense articles as
                                           described in Note 2.
XIII(k).................................  Defense articles and          ............            X             X
                                           services related to tooling
                                           and equipment specifically
                                           designed or modified for
                                           the production of defense
                                           articles identified in USML
                                           Category XIII(b).
XIII(l).................................  Software source code related  ............            X             X
                                           to USML Category XIII(a).
                                           See Note 4.
XIV.....................................  Defense articles and          ............            X             X
                                           services related to
                                           toxicological agents,
                                           including chemical agents,
                                           biological agents, and
                                           associated equipment.
XIV(a), XIV(b), XIV(d), XIV(e), XIV(f)..  Chemical agents listed in               X   ............  ............
                                           USML Category XIV(a), (d)
                                           and (e), biological agents
                                           and biologically derived
                                           substances in USML Category
                                           XIV(b), and equipment
                                           listed in USML Category
                                           XIV(f) for dissemination of
                                           the chemical agents and
                                           biological agents listed in
                                           USML Category XIV(a), (b),
                                           (d), and (e).
XV(a)...................................  Defense articles and                    X             X             X
                                           services specific to
                                           spacecraft/satellites.
                                           However, the Canadian
                                           exemption may be used for
                                           commercial communications
                                           satellites that have no
                                           other type of payload.
XV(b)...................................  Defense articles and          ............            X             X
                                           services specific to ground
                                           control stations for
                                           spacecraft telemetry,
                                           tracking, and control.
                                           Defense articles and
                                           services are not excluded
                                           under this entry if they do
                                           not control the spacecraft.
                                           Receivers for receiving
                                           satellite transmissions are
                                           also not excluded under
                                           this entry.
XV(c)...................................  Defense articles and          ............            X             X
                                           services specific to GPS/
                                           PPS security modules.
XV(c)...................................  Defense articles controlled             X   ............  ............
                                           in USML Category XV(c)
                                           except end-items for end-
                                           use by the Federal
                                           Government of Canada
                                           exported directly or
                                           indirectly through a
                                           Canadian-registered person.
XV(d)...................................  Defense articles and                    X             X             X
                                           services specific to
                                           radiation-hardened
                                           microelectronic circuits.
XV(e)...................................  Anti-jam systems with the               X   ............  ............
                                           ability to respond to
                                           incoming interference by
                                           adaptively reducing antenna
                                           gain (nulling) in the
                                           direction of the
                                           interference.
XV(e)...................................  Antennas having any of the              X   ............  ............
                                           following:.
                                          a. Aperture (overall
                                           dimension of the radiating
                                           portions of the antenna)
                                           greater than 30 feet;.
                                          b. All sidelobes less than
                                           or equal to -35 dB relative
                                           to the peak of the main
                                           beam; or.
                                          c. Designed, modified, or
                                           configured to provide
                                           coverage area on the
                                           surface of the earth less
                                           than 200 nautical miles in
                                           diameter, where ``coverage
                                           area'' is defined as that
                                           area on the surface of the
                                           earth that is illuminated
                                           by the main beam width of
                                           the antenna (which is the
                                           angular distance between
                                           half power points of the
                                           beam).
XV(e)...................................  Optical intersatellite data             X   ............  ............
                                           links (cross links) and
                                           optical ground satellite
                                           terminals.
XV(e)...................................  Spaceborne regenerative                 X   ............  ............
                                           baseband processing (direct
                                           up and down conversion to
                                           and from baseband)
                                           equipment.

[[Page 61759]]

 
XV(e)...................................  Propulsion systems which                X   ............  ............
                                           permit acceleration of the
                                           satellite on-orbit (i.e.,
                                           after mission orbit
                                           injection) at rates greater
                                           than 0.1 g.
XV(e)...................................  Attitude control and                    X   ............  ............
                                           determination systems
                                           designed to provide
                                           spacecraft pointing
                                           determination and control
                                           or payload pointing system
                                           control better than 0.02
                                           degrees per axis.
XV(e)...................................  All specifically designed or            X   ............  ............
                                           modified systems,
                                           components, parts,
                                           accessories, attachments,
                                           and associated equipment
                                           for all USML Category XV(a)
                                           items, except when
                                           specifically designed or
                                           modified for use in
                                           commercial communications
                                           satellites.
XV(e)...................................  Defense articles and          ............            X             X
                                           services specific to
                                           spacecraft and ground
                                           control station systems
                                           (only for telemetry,
                                           tracking and control as
                                           controlled in USML Category
                                           XV(b)), subsystems,
                                           components, parts,
                                           accessories, attachments,
                                           and associated equipment.
XV(f)...................................  Technical data and defense              X             X             X
                                           services directly related
                                           to the other defense
                                           articles excluded from the
                                           exemptions for USML
                                           Category XV.
XVI.....................................  Defense articles and                    X             X             X
                                           services specific to design
                                           and testing of nuclear
                                           weapons.
XVI(c)..................................  Nuclear radiation measuring             X   ............  ............
                                           devices manufactured to
                                           military specifications.
XVI(e)..................................  Software source code related  ............            X             X
                                           to USML Category XVI(c).
                                           See Note 4.
XVII....................................  Classified articles, and                X             X             X
                                           technical data and defense
                                           services relating thereto,
                                           not elsewhere enumerated.
                                           See Note 1.
XVIII...................................  Defense articles and          ............            X             X
                                           services specific to
                                           directed energy weapon
                                           systems.
XIX(e), XIX(f)(1), XIX(f)(2), XIX(g)....  Defense articles and          ............            X             X
                                           services specific to gas
                                           turbine engine hot section
                                           components and to Full
                                           Authority Digital Engine
                                           Control Systems (FADEC) or
                                           Digital Electronic Engine
                                           Controls (DEEC). See Note 8.
XIX(g)..................................  Technical data and defense              X             X             X
                                           services for gas turbine
                                           engine hot sections. (This
                                           does not include hardware).
                                           See Note 8.
XX......................................  Defense articles and                    X             X             X
                                           services related to
                                           submersible vessels,
                                           oceanographic, and
                                           associated equipment.
XXI.....................................  Articles, and technical data            X             X             X
                                           and defense services
                                           relating thereto, not
                                           otherwise enumerated on the
                                           USML, but placed in this
                                           category by the Director,
                                           Office of Defense Trade
                                           Controls Policy.
----------------------------------------------------------------------------------------------------------------
 Note 1: Classified defense articles and services are not eligible for export under the Canadian exemptions.
  U.S. origin articles, technical data, and services controlled in USML Category XVII are not eligible for
  export under the UK Treaty exemption. U.S. origin classified defense articles and services are not eligible
  for export under either the UK or AS Treaty exemptions except when being released pursuant to a U.S.
  Department of Defense written request, directive, or contract that provides for the export of the defense
  article or service.
 Note 2: The phrase ``any part of the spectrum'' includes radio frequency (RF), infrared (IR), electro-optical,
  visual, ultraviolet (UV), acoustic, and magnetic. Defense articles related to reduced observables or counter
  reduced observables are defined as:
(a) Signature reduction (radio frequency (RF), infrared (IR), Electro-Optical, visual, ultraviolet (UV),
  acoustic, magnetic, RF emissions) of defense platforms, including systems, subsystems, components, materials
  (including dual-purpose materials used for Electromagnetic Interference (EM) reduction), technologies, and
  signature prediction, test and measurement equipment and software and material transmissivity/reflectivity
  prediction codes and optimization software.
(b) Electronically scanned array radar, high power radars, radar processing algorithms, periscope-mounted radar
  systems (PATRIOT), LADAR, multistatic and IR focal plane array-based sensors, to include systems, subsystems,
  components, materials, and technologies.
 Note 3: Defense Articles related to sensor fusion beyond that required for display or identification
  correlation is defined as techniques designed to automatically combine information from two or more sensors/
  sources for the purpose of target identification, tracking, designation, or passing of data in support of
  surveillance or weapons engagement. Sensor fusion involves sensors such as acoustic, infrared, electro
  optical, frequency, etc. Display or identification correlation refers to the combination of target detections
  from multiple sources for assignment of common target track designation.
 Note 4: Software source code beyond that source code required for basic operation, maintenance, and training
  for programs, systems, and/or subsystems is not eligible for use of the UK or AS Treaty exemptions, unless
  such export is pursuant to a written solicitation or contract issued or awarded by the U.S. Department of
  Defense for an end-use identified in paragraph (e)(1), (e)(2), or (e)(4) of Sec.   126.16 or Sec.   126.17 of
  this subchapter and is consistent with other exclusions of this supplement.
 Note 5: Manufacturing know-how, as defined in Sec.   125.4(c)(6) of this subchapter, is not eligible for use of
  the UK or AS Treaty exemptions, unless such export is pursuant to a written solicitation or contract issued or
  awarded by the U.S. Department of Defense for an end-use identified in paragraph (e)(1), (e)(2), or (e)(4) of
  Sec.   126.16 or Sec.   126.17 of this subchapter and is consistent with other exclusions of this supplement.
 Note 6: Defense Articles specific to Man Portable Air Defense Systems (MANPADS) includes missiles which can be
  used without modification in other applications. It also includes production and test equipment and components
  specifically designed or modified for MANPAD systems, as well as training equipment specifically designed or
  modified for MANPAD systems.
 Note 7: Naval nuclear propulsion plants includes all of USML Category VI(e). Naval nuclear propulsion
  information is technical data that concerns the design, arrangement, development, manufacture, testing,
  operation, administration, training, maintenance, and repair of the propulsion plants of naval nuclear-powered
  ships and prototypes, including the associated shipboard and shore-based nuclear support facilities. Examples
  of defense articles covered by this exclusion include nuclear propulsion plants and nuclear submarine
  technologies or systems; nuclear powered vessels (see USML Categories VI and XX).
 Note 8: A complete gas turbine engine with embedded hot section components or digital engine controls is
  eligible for export or transfer under the Treaties. Technical data, other than required for routine external
  maintenance and operation, related to the hot section is not eligible for export under the Canadian exemption.
  Technical data, other than required for routine external maintenance and operation, related to the hot section
  or digital engine controls, as well as individual hot section parts or components are not eligible for the
  Treaty exemption whether shipped separately or accompanying a complete engine. Gas turbine engine hot section
  exempted defense article components and technology are 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. Examples of gas turbine engine hot section
  developmental technologies are Integrated High Performance Turbine Engine Technology (IHPTET), Versatile,
  Affordable Advanced Turbine Engine (VAATE), and Ultra-Efficient Engine Technology (UEET), which are also
  excluded from export under the exemptions.
 Note 9: Examples of countermeasures and counter-countermeasures related to defense articles not exportable
  under the AS or UK Treaty exemptions are:

[[Page 61760]]

 
(a) IR countermeasures;
(b) Classified techniques and capabilities;
(c) Exports for precision radio frequency location that directly or indirectly supports fire control and is used
  for situation awareness, target identification, target acquisition, and weapons targeting and Radio Direction
  Finding (RDF) capabilities. Precision RF location is defined as angle of arrival accuracy of less than five
  degrees (RMS) and RF emitter location of less than ten percent range error;
(d) Providing the capability to reprogram; and
(e) Acoustics (including underwater), active and passive countermeasures, and counter-countermeasures.
 Note 10: Examples of defense articles covered by this exclusion include underwater acoustic vector sensors;
  acoustic reduction; off-board, underwater, active and passive sensing, propeller/propulsor technologies; fixed
  mobile/floating/powered detection systems which include in-buoy signal processing for target detection and
  classification; autonomous underwater vehicles capable of long endurance in ocean environments (manned
  submarines excluded); automated control algorithms embedded in on-board autonomous platforms which enable (a)
  group behaviors for target detection and classification, (b) adaptation to the environment or tactical
  situation for enhancing target detection and classification; ``intelligent autonomy'' algorithms which define
  the status, group (greater than 2) behaviors, and responses to detection stimuli by autonomous, underwater
  vehicles; and low frequency, broad-band ``acoustic color,'' active acoustic ``fingerprint'' sensing for the
  purpose of long range, single pass identification of ocean bottom objects, buried or otherwise (controlled
  under Category USML XI(a)(1), (a)(2), (b), (c), and (d)).
 Note 11: This exclusion does not apply to the platforms (e.g., vehicles) for which the armored plates are
  applied. For exclusions related to the platforms, reference should be made to the other exclusions in this
  list, particularly for the category in which the platform is controlled.
The excluded defense articles include constructions of metallic or non-metallic materials or combinations
  thereof specially designed to provide protection for military systems. The phrase ``suitable for military
  use'' applies to any articles or materials which have been tested to level IIIA or above IAW NIJ standard
  0108.01 or comparable national standard. This exclusion does not include military helmets, body armor, or
  other protective garments which may be exported IAW the terms of the AS or UK Treaty.
 Note 12: Defense services or technical data specific to applied research (Sec.   125.4(c)(3) of this
  subchapter), design methodology (Sec.   125.4(c)(4) of this subchapter), engineering analysis (Sec.
  125.4(c)(5) of this subchapter), or manufacturing know-how (Sec.   125.4(c)(6) of this subchapter) are not
  eligible for export under the Canadian exemptions. However, this exclusion does not include defense services
  or technical data specific to build-to-print as defined in Sec.   125.4(c)(1) of this subchapter, build/design-
  to-specification as defined in Sec.   125.4(c)(2) of this subchapter, or basic research as defined in Sec.
  125.4(c)(3) of this subchapter, or maintenance (i.e., inspection, testing, calibration or repair, including
  overhaul, reconditioning and one-to-one replacement of any defective items parts or components, but excluding
  any modification, enhancement, upgrade or other form of alteration or improvement that changes the basic
  performance of the item) of non-excluded defense articles which may be exported subject to other exclusions or
  terms of the Canadian exemptions.
 Note 13: The term ``libraries'' (parametric technical databases) means a collection of technical information of
  a military nature, reference to which may enhance the performance of military equipment or systems.
 Note 14: In order to utilize the authorized defense services under the Canadian exemption, the following must
  be complied with:
(a) The Canadian contractor and subcontractor must certify, in writing, to the U.S. exporter that the technical
  data and defense services being exported will be used only for an activity identified in Supplement No. 1 to
  part 126 of this subchapter and in accordance with Sec.   126.5 of this subchapter; and
(b) A written arrangement between the U.S. exporter and the Canadian recipient must:
(1) Limit delivery of the defense articles being produced directly to an identified manufacturer in the United
  States registered in accordance with part 122 of this subchapter; a department or agency of the United States
  Federal Government; a Canadian-registered person authorized in writing to manufacture defense articles by and
  for the Government of Canada; a Canadian Federal, Provincial, or Territorial Government;
(2) Prohibit the disclosure of the technical data to any other contractor or subcontractor who is not a Canadian-
  registered person;
(3) Provide that any subcontract contain all the limitations of Sec.   126.5 of this subchapter;
(4) Require that the Canadian contractor, including subcontractors, destroy or return to the U.S. exporter in
  the United States all of the technical data exported pursuant to the contract or purchase order upon
  fulfillment of the contract, unless for use by a Canadian or United States Government entity that requires in
  writing the technical data be maintained. The U.S. exporter must be provided written certification that the
  technical data is being retained or destroyed; and
(5) Include a clause requiring that all documentation created from U.S. origin technical data contain the
  statement that, ``This document contains technical data, the use of which is restricted by the U.S. Arms
  Export Control Act. This data has been provided in accordance with, and is subject to, the limitations
  specified in Sec.   126.5 of the International Traffic in Arms Regulations (ITAR). By accepting this data, the
  consignee agrees to honor the requirements of the ITAR.''
(c) The U.S. exporter must provide the Directorate of Defense Trade Controls a semi-annual report of all their
  on-going activities authorized under Sec.   126.5 of this subchapter. The report shall include the article(s)
  being produced; the end-user(s); the end-item into which the product is to be incorporated; the intended end-
  use of the product; the name and address of all the Canadian contractors and subcontractors.
 Note 15: This exclusion does not apply to demining equipment in support of the clearance of landmines and
  unexploded ordnance for humanitarian purposes. As used in this exclusion, ``anti-personnel landmine'' means
  any mine placed under, on, or near the ground or other surface area, or delivered by artillery, rocket,
  mortar, or similar means or dropped from an aircraft and which is designed to be detonated or exploded by the
  presence, proximity, or contact of a person; any device or material which is designed, constructed, or adapted
  to kill or injure and which functions unexpectedly when a person disturbs or approaches an apparently harmless
  object or performs an apparently safe act; any manually-emplaced munition or device designed to kill, injure,
  or damage and which is actuated by remote control or automatically after a lapse of time.
 Note 16: The cluster munitions that are subject to this exclusion are set forth below:
The Convention on Cluster Munitions, signed December 3, 2008, and entered into force on August 1, 2010, defines
  a ``cluster munition'' as:
A conventional munition that is designed to disperse or release explosive submunitions each weighing less than
  20 kilograms, and includes those explosive submunitions. Under the Convention, a ``cluster munition'' does not
  include the following munitions:
(a) A munition or submunition designed to dispense flares, smoke, pyrotechnics or chaff; or a munition designed
  exclusively for an air defense role;
(b) A munition or submunition designed to produce electrical or electronic effects;
(c) A munition that, in order to avoid indiscriminate area effects and the risks posed by unexploded
  submunitions, has all of the following characteristics:
(1) Each munition contains fewer than ten explosive submunitions;
(2) Each explosive submunition weighs more than four kilograms;
(3) Each explosive submunition is designed to detect and engage a single target object;
(4) Each explosive submunition is equipped with an electronic self-destruction mechanism; and
(5) Each explosive submunition is equipped with an electronic self-deactivating feature.
Pursuant to U.S. law (Pub. L. 111-117, section 7055(b)), no military assistance shall be furnished for cluster
  munitions, no defense export license for cluster munitions may be issued, and no cluster munitions or cluster
  munitions technology shall be sold or transferred, unless:
(a) The submunitions of the cluster munitions, after arming, do not result in more than 1 percent unexploded
  ordnance across the range of intended operational environments; and
(b) The agreement applicable to the assistance, transfer or sale of such cluster munitions or cluster munitions
  technology specifies that the cluster munitions will only be used against clearly defined military targets and
  will not be used where civilians are known to be present or in areas normally inhabited by civilians.
 Note 17: The radar systems described are controlled in USML Category XI(a)(3)(i) through (v). As used in this
  entry, the term ``systems'' includes equipment, devices, software, assemblies, modules, components, practices,
  processes, methods, approaches, schema, frameworks, and models.
 * An ``X'' in the chart indicates that the item is excluded from use under the exemption referenced in the top
  of the column. An item excluded in any one row is excluded regardless of whether other rows may contain a
  description that would include the item.



[[Page 61761]]

Rose E. Gottemoeller,
Acting Under Secretary, Arms Control and International Security, 
Department of State.
[FR Doc. 2013-24235 Filed 10-2-13; 8:45 am]
BILLING CODE 4710-25-P