[Federal Register Volume 82, Number 113 (Wednesday, June 14, 2017)]
[Rules and Regulations]
[Pages 27108-27110]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-12269]
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
15 CFR Parts 740 and 774
[Docket No. 160217120-7396-02]
RIN 0694-AG85
Wassenaar Arrangement 2015 Plenary Agreements Implementation,
Removal of Foreign National Review Requirements, and Information
Security Updates; Corrections
AGENCY: Bureau of Industry and Security, Commerce.
ACTION: Correcting amendments.
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SUMMARY: The Bureau of Industry and Security (BIS) maintains, as part
of its Export Administration Regulations (EAR), the Commerce Control
List (CCL), which identifies certain items subject to Department of
Commerce jurisdiction. This rule corrects citations, replaces text that
was inadvertently removed, and corrects other errors associated with
the ``Wassenaar Arrangement 2015 Plenary Agreements Implementation,
Removal of Foreign National Review Requirements, and Information
Security Updates'' final rule published on September 20, 2016 (WA15
rule).
DATES: This rule is effective: June 14, 2017.
FOR FURTHER INFORMATION CONTACT: For general questions contact Sharron
Cook, Office of Exporter Services, Bureau of Industry and Security,
U.S. Department of Commerce at 202-482 2440 or by email:
[email protected].
For technical questions contact: Office of National Security and
Technology Transfer Controls, Information Technology Control Division,
Aaron Amundson at 202-482-0707.
SUPPLEMENTARY INFORMATION:
Background
On September 20, 2016, BIS published a final rule entitled,
``Wassenaar Arrangement 2015 Plenary Agreements Implementation, Removal
of Foreign National Review Requirements, and Information Security
Updates'' (81 FR 64656-64692), (WA15
[[Page 27109]]
rule). The Wassenaar Arrangement (WA) on Export Controls for
Conventional Arms and Dual-Use Goods and Technologies is a group of 41
like-minded states committed to promoting responsibility and
transparency in the global arms trade, and preventing destabilizing
accumulations of arms. As a Participating State, the United States has
committed to controlling for export all items on the WA control lists.
The lists were first established in 1996 and have been revised annually
thereafter. Proposals for changes to the WA control lists that achieve
consensus are approved by Participating States at annual Plenary
meetings. Participating States are charged with implementing the agreed
list changes as soon as possible after approval. The United States'
implementation of WA list changes ensures U.S. companies have a level
playing field with their competitors in other WA Participating States.
This rule affects three sections of the EAR by correcting citations,
replacing text that was inadvertently removed, and correcting other
errors associated with the publication of the September 20th WA15 rule.
Part 740--License Exceptions, Sec. 740.13 Technology and Software
Unrestricted (TSU)
The introductory paragraph of Sec. 740.13 (License Exception TSU)
of the EAR is corrected by removing the reference to ``encryption
source code (and corresponding object code) that would be considered
publicly available under Sec. 734.3(b)(3) of the EAR,'' because the
publicly available provisions for encryption were moved to Sec.
742.15(b) in the WA15 rule. This action also adds to the introductory
paragraph a reference to ``release of technology and source code in the
United States by U.S. universities to their bona fide and full time
regular employees'' as that authorization was added in Sec. 740.13(f)
of the EAR by the initial implementation rule (78 FR 22718), April 16,
2013.
Part 740--License Exceptions, Sec. 740.17 Encryption Commodities,
Software, and Technology (ENC)
This correcting action makes three changes to Sec. 740.17 of the
EAR, as described below.
In Sec. 740.17, a Note that was inadvertently removed by the WA15
rule is added to introductory paragraph (b). The Note was omitted by
error when the mass market provisions were moved from Sec. 742.15(b)
to Sec. 740.17(b) in order to consolidate these provisions in one
place.
Also in Sec. 740.17, paragraph (b)(2)(i) is amended by replacing
the incorrect reference to non-existing paragraph (a)(i)(A) and adding
in its place the correct reference to paragraph (b)(2)(i)(A).
Supplement No. 3 to Part 774 (Statements of Understanding)
This correction rule amends the Notes to paragraph (a) by revising
paragraph (6) to replace the reference to Note 1 to Category 5, Part II
with a reference to Supplement No. 2 to part 774 of the EAR because
Note 1 to Category 5, Part II was removed by the WA15 rule and replaced
with the Supp. No. 2 reference.
Export Administration Act
Although the Export Administration Act of 1979, as amended, expired
on August 21, 2001, the President, through Executive Order 13222 of
August 17, 2001, 3 CFR, 2001 Comp., p. 783 (2002), as amended by
Executive Order 13637 of March 8, 2013, 78 FR 16129 (March 13, 2013),
and as extended by the Notice of August 4, 2016, 81 FR 52587 (August 8,
2016), has continued the Export Administration Regulations (EAR) in
effect under the International Emergency Economic Powers Act (50 U.S.C.
1701 et seq.). BIS continues to carry out the provisions of the Export
Administration Act, as appropriate and to the extent permitted by law,
pursuant to Executive Order 13222, as amended by Executive Order 13637.
Rulemaking Requirements
1. Executive Orders 13563 and 12866 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, of reducing costs, of harmonizing rules, and of promoting
flexibility. This rule has been designated a ``significant regulatory
action,'' as defined under Executive Order 12866.
2. This rule does not contain policies with Federalism implications
as that term is defined under Executive Order 13132.
3. The provisions of the Administrative Procedure Act requiring
notice of proposed rulemaking, the opportunity for public
participation, and a 30-day delay in effective date (5 U.S.C. 553) are
inapplicable, because this regulation involves a military and foreign
affairs function of the United States (5 U.S.C. 553(a)(1)). Immediate
implementation of these amendments fulfills the United States'
international obligation to the Wassenaar Arrangement on Export
Controls for Conventional Arms and Dual-Use Goods and Technologies
(Wassenaar Arrangement). The Wassenaar Arrangement contributes to
international security and regional stability by promoting greater
responsibility in transfers of conventional arms and dual use goods and
technologies, thus preventing destabilizing accumulations of such
items. The Wassenaar Arrangement consists of 41 member countries that
act on a consensus basis, and the changes set forth in this action make
technical corrections to regulations implementing agreements reached at
the December 2015 plenary session of the Wassenaar Arrangement. Because
the United States is a significant exporter of the items covered by
this rule, implementation of this rule is necessary for the Wassenaar
Arrangement to achieve its purpose. Any delay in implementation will
create a disruption in the movement of affected items globally, because
of disharmony between export control measures implemented by Wassenaar
Arrangement members, resulting in tension between member countries.
Export controls work best when all countries implement the same export
controls in a timely manner. Delaying this rulemaking to allow for
notice and comment and a 30-day delay in effectiveness would prevent
the United States from fulfilling its commitment to the Wassenaar
Arrangement in a timely manner, and would injure the credibility of the
United States in this and other multilateral regimes.
In addition, issuing a notice of proposed rulemaking would be
inappropriate and contrary to the public interest in this instance, as
this rule is merely making corrections to a previously published final
rule.
Although there is no formal comment period, public comments on this
final rule are welcome on a continuing basis. Comments should be
submitted to Sharron Cook, Office of Exporter Services, Bureau of
Industry and Security, Department of Commerce, 14th and Pennsylvania
Ave. NW., Room 2099, Washington, DC 20230.
4. Because this action merely makes technical correcting amendments
to the previously published WA15 final rule, the analysis required by
the the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) that is
contained in the WA15 final rule continues to apply to the regulatory
text that is corrected by this
[[Page 27110]]
action, and no additional analysis is necessary.
List of Subjects
15 CFR Part 740
Administrative practice and procedure, Exports, Reporting and
recordkeeping requirements.
15 CFR Part 774
Exports, Reporting and recordkeeping requirements.
Accordingly, parts 740 and 774 of the Export Administration
Regulations (15 CFR parts 730 through 774) are amended as follows:
PART 740 [AMENDED]
0
1. The authority citation for part 740 continues to read as follows:
Authority: 50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; 22
U.S.C. 7201 et seq.; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p.
228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of
August 4, 2016, 81 FR 52587 (August 8, 2016).
0
2. Section 740.13 is amended by revising the introductory text to read
as follows:
Sec. 740.13 Technology and Software--unrestricted (TSU).
This license exception authorizes exports and reexports of
operation technology and software; sales technology and software;
software updates (bug fixes); ``mass market'' software subject to the
General Software Note; and release of technology and source code in the
United States by U.S. universities to their bona fide and full time
regular employees. Note that encryption software subject to the EAR is
not subject to the General Software Note (see paragraph (d)(2) of this
section).
* * * * *
0
3. In Sec. 740.17:
0
a. Paragraph (b) introductory text is amended by adding a Note to the
paragraph; and
0
b. Paragraph (b)(2)(i) is amended by removing the reference ``paragraph
(a)(i)(A)'' and adding in its place ``paragraph (b)(2)(i)(A)''.
The addition reads as follows:
Sec. 740.17 Encryption commodities, software, and technology (ENC).
* * * * *
(b) * * *
Note to paragraph (b) introductory text: Mass market encryption
software that would be considered publicly available under Sec.
734.3(b)(3) of the EAR, and is authorized for export under this
paragraph (b), remains subject to the EAR until all applicable
classification or self-classification requirements set forth in this
section are fulfilled.
* * * * *
PART 774 [AMENDED]
0
4. The authority citation for part 774 continues to read as follows:
Authority: 50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; 10
U.S.C. 7420; 10 U.S.C. 7430(e); 22 U.S.C. 287c, 22 U.S.C. 3201 et
seq.; 22 U.S.C. 6004; 42 U.S.C. 2139a; 15 U.S.C. 1824a; 50 U.S.C.
4305; 22 U.S.C. 7201 et seq.; 22 U.S.C. 7210; E.O. 13026, 61 FR
58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR,
2001 Comp., p. 783; Notice of August 4, 2016, 81 FR 52587 (August 8,
2016).
Supplement No. 3 to Part 774 [Amended]
0
5. In Supplement No. 3 to part 774, the Notes to paragraph (a) are
amended by revising paragraph (6) to read as follows:
Supplement No. 3 to Part 774--Statements of Understanding
(a) * * *
Notes to Paragraph (a): * * *
(6) For commodities and software ``specially designed'' for medical
end-use that incorporate an encryption or other ``information
security'' item subject to the EAR, see also section 3 (General
``Information Security'' Note (GISN)) to Supplement No. 2 to this part.
* * * * *
Dated: June 7, 2017.
Matthew S. Borman,
Deputy Assistant Secretary for Export Administration.
[FR Doc. 2017-12269 Filed 6-13-17; 8:45 am]
BILLING CODE 3510-33-P