[Federal Register Volume 81, Number 247 (Friday, December 23, 2016)]
[Rules and Regulations]
[Pages 94254-94259]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-30968]
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DEPARTMENT OF THE TREASURY
Office of Foreign Assets Control
31 CFR Part 560
Iranian Transactions and Sanctions Regulations
AGENCY: Office of Foreign Assets Control, Treasury.
ACTION: Final rule.
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[[Page 94255]]
SUMMARY: The Department of the Treasury's Office of Foreign Assets
Control (OFAC) is adopting a final rule amending the Iranian
Transactions and Sanctions Regulations (ITSR) to reflect OFAC's
licensing policies and address inquiries from the regulated public.
This final rule makes changes relating to authorized sales of
agricultural commodities, medicine, and medical devices to Iran
pursuant to the Trade Sanctions Reform and Export Enhancement Act of
2000 (TSRA), as amended, and clarifies the definition of the terms
goods of Iranian origin and Iranian-origin goods.
DATES: Effective: December 23, 2016.
FOR FURTHER INFORMATION CONTACT: The Department of the Treasury's
Office of Foreign Assets Control: Assistant Director for Licensing,
tel.: 202-622-2480, Assistant Director for Regulatory Affairs, tel.:
202-622-4855, Assistant Director for Sanctions Compliance & Evaluation,
tel.: 202-622-2490; or the Department of the Treasury's Office of the
Chief Counsel (Foreign Assets Control), Office of the General Counsel,
tel.: 202-622-2410.
SUPPLEMENTARY INFORMATION:
Electronic Availability
This document and additional information concerning OFAC are
available from OFAC's Web site (www.treasury.gov/ofac).
Background
TSRA Amendments
OFAC first issued regulations to implement TSRA (22 U.S.C. 7201 et
seq.) on July 12, 2001 (66 FR 36683). Since then, OFAC has amended the
licensing provisions of the ITSR (and its predecessor, the Iranian
Transactions Regulations), 31 CFR part 560, as they relate to the
exportation and reexportation of agricultural commodities, medicine, or
medical devices to Iran on a number of occasions. As set forth in more
detail below, OFAC is adopting a final rule to amend the licensing
provisions of the ITSR to expand the scope of medical devices and
agricultural commodities generally authorized for export or reexport to
Iran and, in response to feedback from the regulated public regarding
improving patient safety, provide new or expanded authorizations
relating to training, replacement parts, software and services related
to the operation, maintenance, and repair of medical devices, and items
that are broken or connected to product recalls or other safety
concerns.
Statutory Background
TSRA provides that, with certain exceptions, the President may not
impose a unilateral agricultural sanction or unilateral medical
sanction against a foreign country or foreign entity unless, at least
60 days before imposing such a sanction, the President submits a report
to Congress describing the proposed sanction and the reasons for it and
Congress enacts a joint resolution approving the report. See 22 U.S.C.
7202. Section 906 of TSRA, however, requires in pertinent part that the
export of agricultural commodities, medicine, or medical devices to the
government of a country that has been determined by the Secretary of
State, pursuant to, inter alia, Section 6(j) of the Export
Administration Act of 1979 (50 U.S.C. App. 2405(j)), to have repeatedly
provided support for acts of international terrorism,\1\ or to any
entity in such a country, shall be made pursuant to one-year licenses
issued by the United States Government, except that the requirements of
such one-year licenses shall be no more restrictive than general
licenses administered by the Department of the Treasury. See 22 U.S.C.
7205(a)(1). Section 906 also specifies that procedures shall be in
place to deny licenses for exports of agricultural commodities,
medicine, or medical devices to any entity within such country
promoting international terrorism.
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\1\ The Secretary of State made such a determination with
respect to Iran on January 19, 1984.
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As provided in Section 221 of the USA PATRIOT Act (Pub. L. 107-56)
(codified at 22 U.S.C. 7210), nothing in TSRA shall limit the
application or scope of any law, including any Executive order or
regulation promulgated pursuant to such law, establishing criminal or
civil penalties for the unlawful export of any agricultural commodity,
medicine, or medical device to: A Foreign Terrorist Organization; a
foreign organization, group, or person designated pursuant to Executive
Orders 12947 or 13224 (sanctions on terrorists and certain supporters
of terrorism); weapons of mass destruction or missile proliferators; or
designated narcotics trafficking entities. In addition, TSRA provides
in Section 904(2) that the restrictions on the imposition of unilateral
agricultural sanctions or unilateral medical sanctions shall not affect
any authority or requirement to impose a sanction to the extent such
sanction applies to any agricultural commodity, medicine, or medical
device that is controlled on the United States Munitions List (USML),
controlled on any control list established under the Export
Administration Act of 1979 or any successor statute, or used to
facilitate the design, development, or production of chemical or
biological weapons, missiles, or weapons of mass destruction. See 22
U.S.C. 7203(2).
Specific TSRA-Related Regulatory Amendments
On October 22, 2012, OFAC adopted a final rule that, among other
things, added a general license in Sec. 560.530(a)(3) of the ITSR that
authorized the exportation or reexportation of medicine and basic
medical supplies to the Government of Iran, to individuals or entities
in Iran, or to persons in third countries purchasing specifically for
resale to any of the foregoing, and the conduct of related transactions
(see 77 FR 64664). The term ``basic medical supplies'' was defined to
mean those medical devices, as defined in the ITSR, that were included
on the List of Basic Medical Supplies made available on OFAC's Web site
and published in the Federal Register, but did not include replacement
parts. On April 17, 2014, OFAC adopted a final rule that, among other
things, updated the definition of ``basic medical supplies'' to exclude
the word ``basic'' and make related conforming changes, including
renaming the list on OFAC's Web site as the ``List of Medical
Supplies'' (see 79 FR 18990). On November 2, 2015 and April 12, 2016,
OFAC updated the List of Medical Supplies to add additional medical
devices to the list.
Also on April 17, 2014, OFAC expanded an existing general license
in Sec. 560.530(a)(2) that authorized the exportation and
reexportation of food to authorize the exportation or reexportation of
the broader category of agricultural commodities, with certain
specified exceptions, to the Government of Iran, to individuals or
entities in Iran, or to persons in third countries purchasing
specifically for resale to any of the foregoing, and the conduct of
related transactions (see 79 FR 18980). OFAC also added a general
license in Sec. 560.530(a)(4) authorizing the exportation or
reexportation of replacement parts for certain medical devices,
provided that the replacement parts are designated as EAR99 or, in the
case of replacement parts that are not subject to the EAR, would be
designated as EAR99 if they were located in the United States, and
further provided that the replacement parts are limited to a one-for-
one basis of exchange (i.e., only one replacement part can be exported
or
[[Page 94256]]
reexported to replace a broken or non-operational component).
Since these amendments, in consultation with the Department of
State, OFAC has routinely issued specific licenses authorizing the
exportation or reexportation of certain additional medical devices and
agricultural commodities to the Government of Iran, to individuals or
entities in Iran, or to persons in third countries purchasing such
goods specifically for resale to any of the foregoing. In addition,
OFAC has continued to receive feedback from the regulated public and
review its TSRA licensing procedures, particularly the procedures for
licensing exports and reexports of medical devices and agricultural
commodities.
As a result of this review, OFAC today is amending the general
license relating to authorized sales of certain medical devices in
Sec. 560.530(a)(3) to expand the scope of medical devices that may be
exported or reexported to Iran without specific authorization. OFAC is
also narrowing the list of agricultural commodities excluded from the
general license relating to authorized sales of agricultural
commodities in Sec. 560.530(a)(2). In addition, in response to
feedback from the regulated public regarding improving patient safety,
OFAC is making the following changes: Expanding existing general
licenses to authorize the provision of training for the safe and
effective use or operation of agricultural commodities, medicine, and
medical devices; expanding an existing general license authorizing the
exportation or reexportation to Iran of replacement parts to permit
certain additional replacement parts to be exported or reexported and
stored for future use; adding a new general license to authorize the
exportation and reexportation to Iran of software and services related
to the operation, maintenance, and repair of medical devices previously
exported pursuant to an OFAC authorization; and adding a new general
license to authorize the importation into the United States of items
previously exported pursuant to an OFAC authorization in connection
with product recalls, adverse events, or other safety concerns, as set
forth in more detail below.
Additional medical devices. OFAC is amending the existing general
license in Sec. 560.530(a)(3) relating to authorized exports or
reexports of certain medical devices specified on the List of Medical
Supplies. As amended, the general license has been expanded to
authorize the exportation or reexportation to Iran of all items meeting
the definition of the term ``medical device'' as set forth in Sec.
560.530(e)(3), except for certain medical devices that are explicitly
excluded from the authorization as specified in a new List of Medical
Devices Requiring Specific Authorization, which is maintained on OFAC's
Web site on the Iran Sanctions page, as set forth in revised Sec.
560.530(a)(3)(ii). The List of Medical Devices Requiring Specific
Authorization will also be published in the Federal Register, as will
any changes to this list. The exportation and reexportation of the
specified excluded medical devices requires specific authorization from
OFAC, as reflected in amended Sec. 560.530(a)(1)(ii)(C). Medical
devices other than those specified on the new List of Medical Devices
Requiring Specific Authorization may be exported or reexported to Iran
without separate authorization from OFAC. In light of these changes,
this rule also eliminates reference to the List of Medical Supplies.
Excluded agricultural commodities. OFAC is also narrowing the list
of excluded agricultural commodities set forth in Sec.
560.530(a)(2)(ii). Pursuant to this amendment, the general license in
Sec. 560.530(a)(2) now authorizes the exportation or reexportation to
Iran of shrimp and shrimp eggs.
Training. OFAC is adding a new provision in Sec. 560.530(a)(2)(iv)
to generally authorize the provision of training necessary and
ordinarily incident to the safe and effective use of agricultural
commodities exported or reexported pursuant to the general license in
Sec. 560.530(a)(2). OFAC similarly is adding a new provision in Sec.
560.530(a)(3)(v) to authorize the provision of training necessary and
ordinarily incident to the safe and effective use or operation of
medicine and medical devices exported or reexported pursuant to the
general license in Sec. 560.530(a)(3).
Additional replacement parts. OFAC is amending the existing general
license in Sec. 560.530(a)(4) authorizing exports or reexports of and
related transactions for replacement parts for certain medical devices
that are designated as EAR99 or, in the case of replacement parts that
are not subject to the EAR, would be designated as EAR99 if they were
located in the United States, on a one-for-one export or reexport basis
of exchange. As amended, the general license removes the requirement
for a one-for-one basis of exchange and allows the exportation and
reexportation of such replacement parts provided that they are intended
to replace a broken or nonoperational component of a medical device
previously exported or reexported to Iran pursuant to an OFAC
authorization or that the exportation or reexportation of the
replacement part is ordinarily incident and necessary to the proper
preventative maintenance of such a medical device, and further provided
that the number of replacement parts that are exported or reexported to
and stored in Iran does not exceed the number of corresponding parts in
use in relevant medical devices in Iran.
Software and services related to the operation, maintenance, and
repair of medical devices. OFAC is adding a new general license in
Sec. 560.530(a)(5) to authorize the exportation or reexportation to
Iran of software and services related to the operation, maintenance,
and repair of medical devices that previously were exported or
reexported to Iran pursuant to an OFAC authorization, provided that,
among other things, such software is designated as EAR99, or in the
case of software that is not subject to the EAR, would be designated as
EAR99 if it were located in the United States. In Sec.
560.530(a)(5)(i), OFAC is adding an authorization for the exportation
or reexportation to Iran of software necessary for the installation and
operation of medical devices authorized for export or reexport by OFAC.
In Sec. 560.530(a)(5)(ii), OFAC is adding an authorization to allow
the exportation or reexportation of software updates for those devices.
In Sec. 560.530(a)(5)(iii), OFAC is adding an authorization for repair
services for medical devices authorized for export or reexport to Iran
by OFAC, including inspection, testing, calibration, and diagnostic
services to ensure patient safety or effective operation of such
medical devices.
Importation of items that are broken, defective, or non-operational
or in connection with product recalls, adverse events, or other safety
concerns. OFAC also is adding a new general license in Sec.
560.530(a)(6) to authorize the importation into the United States of
certain U.S.-origin agricultural commodities, medicine, and medical
devices that previously were exported or reexported to Iran pursuant to
the authorization in Sec. 560.530 and that are broken, defective, or
non-operational or connected to product recalls, adverse events, or
other safety concerns.
Conforming change to section headings. In light of the addition of
several new general licenses in Sec. 560.530, OFAC is also making a
conforming change to the section heading to reflect the additions. As
the new general licenses require the payment and financing terms set
forth in Sec. 560.532, OFAC is making a similar
[[Page 94257]]
conforming change to that section heading to reflect the additions.
Amendment to Definition of ``Goods of Iranian Origin'' and ``Iranian-
Origin Goods''
To address inquiries from the regulated public, including with
regard to the status of goods on vessels and aircraft, OFAC also is
amending the definition in Sec. 560.306 of the terms goods of Iranian
origin and Iranian-origin goods to clarify that this definition does
not include certain categories of goods, provided that such goods were
not grown, produced, manufactured, extracted, or processed in Iran.
First, the amended definition excludes goods exported or reexported to
Iran under an authorization issued pursuant to this part (e.g., a
medical device or a personal communications device exported or
reexported to Iran pursuant to a general or specific license issued
pursuant to this part) and that have subsequently been reexported from
and are located outside of Iran. Second, the amended definition also
clarifies that it does not include goods transported on a vessel or
aircraft, as well as the underlying vessel or aircraft itself, that
passed though Iranian territorial waters or stopped at a port or place
in Iran en route to a destination outside of Iran and that have not
otherwise come into contact with Iran. A note clarifies that, pursuant
to this section, goods that are temporarily offloaded from a vessel in
Iranian territorial waters or at a port in Iran and reloaded onto the
same vessel or another vessel in the same location en route to a
destination outside of Iran and that have not otherwise come into
contact with Iran are not considered goods of Iranian origin.
Similarly, goods that are offloaded from an aircraft at a place in Iran
and reloaded onto the same aircraft or another aircraft in the same
location en route to a destination outside of Iran and that have not
otherwise come into contact with Iran are not considered goods of
Iranian origin. This amended definition is relevant to the prohibitions
in Sec. Sec. 560.201 and 560.206 of the ITSR, which remain in place;
it is not relevant to the prohibitions in Sec. Sec. 560.204, 560.205,
and 560.211 on exports of goods to Iran and on transactions in goods
involving blocked persons, which also remain in place.
Public Participation
Because the amendment of the ITSR involves a foreign affairs
function, the provisions of Executive Order 12866 and the
Administrative Procedure Act (5 U.S.C. 553) requiring notice of
proposed rulemaking, opportunity for public participation, and delay in
effective date are inapplicable. Because no notice of proposed
rulemaking is required for this rule, the Regulatory Flexibility Act (5
U.S.C. 601-612) does not apply.
Paperwork Reduction Act
The collections of information related to the ITSR are contained in
31 CFR part 501 (the Reporting, Procedures and Penalties Regulations).
Pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3507), those
collections of information have been approved by the Office of
Management and Budget under control number 1505-0164. An agency may not
conduct or sponsor, and a person is not required to respond to, a
collection of information unless the collection of information displays
a valid control number.
List of Subjects in 31 CFR Part 560
Administrative practice and procedure, Agricultural commodities,
Banks, Banking, Iran, Medicine, Medical devices.
For the reasons set forth in the preamble, the Department of the
Treasury's Office of Foreign Assets Control amends 31 CFR part 560 as
follows:
PART 560--IRANIAN TRANSACTIONS AND SANCTIONS REGULATIONS
0
1. The authority citation for part 560 continues to read as follows:
Authority: 3 U.S.C. 301; 18 U.S.C. 2339B, 2332d; 22 U.S.C.
2349aa-9; 22 U.S.C. 7201-7211; 31 U.S.C. 321(b); 50 U.S.C. 1601-
1651, 1701-1706; Pub. L. 101-410, 104 Stat. 890 (28 U.S.C. 2461
note); Pub. L. 110-96, 121 Stat. 1011 (50 U.S.C. 1705 note); Pub. L.
111-195, 124 Stat. 1312 (22 U.S.C. 8501-8551); Pub. L. 112-81, 125
Stat. 1298 (22 U.S.C. 8513a); Pub. L. 112-158, 126 Stat. 1214 (22
U.S.C. 8701-8795); E.O. 12613, 52 FR 41940, 3 CFR, 1987 Comp., p.
256; E.O. 12957, 60 FR 14615, 3 CFR, 1995 Comp., p. 332; E.O. 12959,
60 FR 24757, 3 CFR, 1995 Comp., p. 356; E.O. 13059, 62 FR 44531, 3
CFR, 1997 Comp., p. 217; E.O. 13599, 77 FR 6659, 3 CFR, 2012 Comp.,
p. 215; E.O. 13628, 77 FR 62139, 3 CFR, 2012 Comp., p. 314.
Subpart C--General Definitions
0
2. Amend Sec. 560.306 by revising paragraph (a), redesignating
paragraphs (b) through (d) as paragraphs (c) through (e), and adding
new paragraph (b) to read as follows:
Sec. 560.306 Iranian-origin goods or services; goods or services
owned or controlled by the Government of Iran.
(a) Except as provided in paragraph (b) of this section, the terms
goods of Iranian origin and Iranian-origin goods include:
(1) Goods grown, produced, manufactured, extracted, or processed in
Iran; and
(2) Goods that have entered into Iranian commerce.
(b) The terms goods of Iranian origin and Iranian-origin goods do
not include the following categories of goods, provided that such goods
were not grown, produced, manufactured, extracted, or processed in
Iran:
(1) Goods exported or reexported to Iran under an authorization
issued pursuant to this part and that have subsequently been reexported
from and are located outside of Iran; or
(2) Goods transported on a vessel or aircraft, as well as the
vessel or aircraft itself, that passed though Iranian territorial
waters or stopped at a port or place in Iran en route to a destination
outside of Iran and that have not otherwise come into contact with
Iran.
Note to paragraph (b)(2) of Sec. 560.306: Pursuant to this
section, goods that are temporarily offloaded from a vessel in
Iranian territorial waters or at a port or place in Iran and
reloaded onto the same vessel or another vessel in the same location
en route to a destination outside of Iran and that have not
otherwise come into contact with Iran are not considered goods of
Iranian origin. Similarly, goods that are offloaded from an aircraft
at a place in Iran and reloaded onto the same aircraft or another
aircraft in the same location en route to a destination outside of
Iran and that have not otherwise come into contact with Iran are not
considered goods of Iranian origin.
* * * * *
Subpart E--Licenses, Authorizations, and Statements of Licensing
Policy
0
3. Amend Sec. 560.530 as follows:
0
a. Revise the section heading and paragraphs (a)(1)(ii)(C) and (D) and
(a)(2)(ii) and (iii);
0
b. Add paragraph (a)(2)(iv);
0
c. Revise paragraphs (a)(3)(i), (ii), and (iv);
0
d. Add paragraph (a)(3)(v);
0
e. Revise paragraphs (a)(4)(i) and (ii);
0
f. Add paragraphs (a)(5) and (6); and
0
g. Revise paragraph (c)(5).
The revisions and additions read as follows:
Sec. 560.530 Commercial sales, exportation, and reexportation of
agricultural commodities, medicine, medical devices, and certain
related software and services.
(a)(1) * * *
(ii) * * *
(C) The excluded medical devices specified in paragraph (a)(3)(ii)
of this section; and
(D) Agricultural commodities (as defined in paragraph (e)(1) of
this
[[Page 94258]]
section), medicine (as defined in paragraph (e)(2) of this section),
and medical devices (as defined in paragraph (e)(3) of this section) to
military, intelligence, or law enforcement purchasers or importers.
(2) * * *
(ii) Excluded agricultural commodities. Paragraph (a)(2)(i) of this
section does not authorize the exportation or reexportation of the
following items: Castor beans, castor bean seeds, certified pathogen-
free eggs (unfertilized or fertilized), dried egg albumin, live animals
(excluding live cattle, shrimp, and shrimp eggs), embryos (excluding
cattle embryos), Rosary/Jequirity peas, non-food-grade gelatin powder,
peptones and their derivatives, super absorbent polymers, western red
cedar, or all fertilizers.
(iii) Excluded persons. Paragraph (a)(2)(i) of this section does
not authorize the exportation or reexportation of agricultural
commodities to military, intelligence, or law enforcement purchasers or
importers.
(iv) General license for related training. The provision by a
covered person (as defined in paragraph (e)(4) of this section) of
training necessary and ordinarily incident to the safe and effective
use of agricultural commodities exported or reexported pursuant to
paragraph (a)(2) of this section to the Government of Iran, to any
individual or entity in Iran, or to persons in a third country
purchasing such goods specifically for resale to any of the foregoing
is authorized, provided that:
(A) Unless otherwise authorized by specific license, payment terms
and financing for sales pursuant to this general license are limited
to, and consistent with, those authorized by Sec. 560.532;
(B) Any technology released pursuant to this authorization is
designated as EAR99; and
(C) Such training is not provided to any military, intelligence, or
law enforcement entity, or any official or agent thereof.
* * * * *
(3)(i) General license for the exportation or reexportation of
medicine and medical devices. Except as provided in paragraphs
(a)(3)(ii) through (iv) of this section, the exportation or
reexportation by a covered person (as defined in paragraph (e)(4) of
this section) of medicine (as defined in paragraph (e)(2) of this
section) and medical devices (as defined in paragraph (e)(3) of this
section) to the Government of Iran, to any individual or entity in
Iran, or to persons in third countries purchasing specifically for
resale to any of the foregoing, and the conduct of related
transactions, including the making of shipping and cargo inspection
arrangements, obtaining of insurance, arrangement of financing and
payment, shipping of the goods, receipt of payment, and entry into
contracts (including executory contracts), are hereby authorized,
provided that, unless otherwise authorized by specific license, payment
terms and financing for sales pursuant to this general license are
limited to, and consistent with, those authorized by Sec. 560.532; and
further provided that all such exports or reexports are shipped within
the 12-month period beginning on the date of the signing of the
contract for export or reexport.
(ii) Excluded medical devices. Paragraph (a)(3)(i) of this section
does not authorize the exportation or reexportation of medical devices
on the List of Medical Devices Requiring Specific Authorization, which
is maintained on OFAC's Web site (www.treasury.gov/ofac) on the Iran
Sanctions page.
* * * * *
(iv) Excluded persons. Paragraph (a)(3)(i) of this section does not
authorize the exportation or reexportation of medicine or medical
devices to military, intelligence, or law enforcement purchasers or
importers.
(v) General license for related training. The provision by a
covered person (as defined in paragraph (e)(4) of this section) of
training necessary and ordinarily incident to the safe and effective
use of medicine and medical devices exported or reexported pursuant to
paragraph (a)(3) of this section to the Government of Iran, to any
individual or entity in Iran, or to persons in a third country
purchasing such goods specifically for resale to any of the foregoing
is authorized, provided that:
(A) Unless otherwise authorized by specific license, payment terms
and financing for sales pursuant to this general license are limited
to, and consistent with, those authorized by Sec. 560.532;
(B) Any technology released pursuant to this authorization is
designated as EAR99; and
(C) Such training is not provided to any military, intelligence, or
law enforcement entity, or any official or agent thereof.
* * * * *
(4) * * *
(i) Except as provided in paragraph (a)(4)(ii) of this section, the
exportation or reexportation by a covered person (as defined in
paragraph (e)(4) of this section) of replacement parts to the
Government of Iran, to any individual or entity in Iran, or to persons
in third countries purchasing specifically for resale to any of the
foregoing, for medical devices (as defined in paragraph (e)(3) of this
section) exported or reexported pursuant to paragraph (a)(1) or
(a)(3)(i) of this section, and the conduct of related transactions,
including the making of shipping and cargo inspection arrangements,
obtaining of insurance, arrangement of financing and payment, shipping
of the goods, receipt of payment, and entry into contracts (including
executory contracts), are hereby authorized, provided that, unless
otherwise authorized by specific license, payment terms and financing
for sales pursuant to this general license are limited to, and
consistent with, those authorized by Sec. 560.532; and further
provided that:
(A) Such replacement parts are designated as EAR99, or, in the case
of replacement parts that are not subject to the Export Administration
Regulations, 15 CFR parts 730 through 774 (EAR), would be designated as
EAR99 if they were located in the United States;
(B) Such replacement parts are exported or reexported to replace a
broken or nonoperational component of a medical device that previously
was exported or reexported pursuant to paragraph (a)(3)(i) of this
section, or the exportation or reexportation of such replacements parts
is necessary and ordinarily incident to the proper preventative
maintenance of such a medical device;
(C) The number of replacement parts that are exported or reexported
and stored in Iran does not exceed the number of corresponding
operational parts currently in use in relevant medical devices in Iran;
and
(D) The broken or non-operational replacement parts that are being
replaced are promptly exported, reexported, or otherwise provided to a
non-Iranian entity located outside of Iran selected by the supplier of
the replacement parts.
(ii) Excluded persons. Paragraph (a)(4)(i) of this section does not
authorize the exportation or reexportation of replacement parts for
medical devices to military, intelligence, or law enforcement
purchasers or importers.
* * * * *
(5) General license for services and software necessary for the
operation, maintenance, and repair of medical devices--(i) Operational
software. Except as provided in paragraph
[[Page 94259]]
(a)(5)(iv) of this section, the exportation or reexportation by a
covered person (as defined in paragraph (e)(4) of this section) to the
Government of Iran, to any individual or entity in Iran, or to persons
in a third country purchasing specifically for resale to any of the
foregoing, of software necessary for the installation and operation of
medical devices or replacement parts exported or reexported pursuant to
this section, and the conduct of related transactions, are hereby
authorized, provided that such software is designated as EAR99, or in
the case of software that is not subject to the EAR, would be
designated as EAR99 if it were located in the United States, and
further provided that, unless otherwise authorized by specific license,
payment terms and financing for sales pursuant to this general license
are limited to, and consistent with, those authorized by Sec. 560.532.
(ii) Software updates. Except as provided in paragraph (a)(5)(iv)
of this section, the exportation or reexportation by a covered person
(as defined in paragraph (e)(4) of this section) to the Government of
Iran, to any individual or entity in Iran, or to persons in a third
country purchasing specifically for resale to any of the foregoing, of
software intended for and limited to the provision of safety and
service updates and the correction of system or operational errors in
medical devices, replacement parts, and associated software that
previously were exported, reexported, or provided pursuant to this
part, and the conduct of related transactions, are hereby authorized,
provided that such software is designated as EAR99, or in the case of
software that is not subject to the EAR, would be designated as EAR99
if it were located in the United States, and further provided that,
unless otherwise authorized by specific license, payment terms and
financing for sales pursuant to this general license are limited to,
and consistent with, those authorized by Sec. 560.532. Such software
updates may be exported or reexported only to the same end user to whom
the original software was exported or reexported.
(iii) Maintenance and Repair Services. Except as provided in
paragraph (a)(5)(iv) of this section, the exportation or reexportation
by a covered person (as defined in paragraph (e)(4) of this section) to
the Government of Iran, to any individual or entity in Iran, or to
persons in a third country purchasing specifically for resale to any of
the foregoing, of services necessary to maintain and repair medical
devices that previously were exported or reexported pursuant to this
section, including inspection, testing, calibration, or repair services
to ensure patient safety or effective operation, and the conduct of
related transactions, are hereby authorized, provided that such
services do not substantively alter the functional capacities of the
medical device as originally authorized for export or reexport, and
further provided that, unless otherwise authorized by specific license,
payment terms and financing for sales pursuant to this general license
are limited to, and consistent with, those authorized by Sec. 560.532.
(iv) Excluded persons. Paragraphs (a)(5)(i) through (iii) of this
section do not authorize the exportation or reexportation of software,
software updates, or maintenance and repair services for medical
devices to military, intelligence, or law enforcement purchasers or
importers.
(6)(i) General license for the importation of certain U.S.-origin
agricultural commodities, medicine, and medical devices. Except as
provided in paragraph (a)(6)(ii) of this section, the importation into
the United States of U.S.-origin agricultural commodities, medicine,
and medical devices, including parts, components, or accessories
thereof, that previously were exported or reexported pursuant to the
authorizations in this section and that are broken, defective, or non-
operational, or are connected to product recalls, adverse events, or
other safety concerns, and the conduct of related transactions, are
hereby authorized.
(ii) Excluded persons. Paragraph (a)(6)(i) of this section does not
authorize the importation into the United States of U.S.-origin
agricultural commodities, medicine, and medical devices that previously
were exported or reexported pursuant to the authorizations in this
section as broken, defective, or non-operational, or in connection with
product recalls, adverse events, or other safety concerns, from
military, intelligence, or law enforcement purchasers or importers.
* * * * *
(c) * * *
(5) For items subject to the EAR, an Official Commodity
Classification of EAR99 issued by the Department of Commerce's Bureau
of Industry and Security (BIS), certifying that the product is
designated as EAR99, is required to be submitted to OFAC with the
request for a license authorizing the exportation or reexportation of
all fertilizers, live horses, western red cedar, or the excluded
medical devices specified in paragraph (a)(3)(ii) of this section. See
15 CFR 748.3 for instructions for obtaining an Official Commodity
Classification of EAR99 from BIS.
* * * * *
0
4. Amend Sec. 560.532 by revising the section heading to read as
follows:
Sec. 560.532 Payment for and financing of exports and reexports of
agricultural commodities, medicine, and medical devices, and certain
related software and services.
* * * * *
John E. Smith,
Acting Director, Office of Foreign Assets Control.
[FR Doc. 2016-30968 Filed 12-22-16; 8:45 am]
BILLING CODE 4810-AL-P