[Federal Register Volume 85, Number 30 (Thursday, February 13, 2020)]
[Notices]
[Pages 8246-8247]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-02848]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

[Docket No. 200113-0009]
RIN 0694-XC055


Impact of the Implementation of the Chemical Weapons Convention 
(CWC) on Legitimate Commercial Chemical, Biotechnology, and 
Pharmaceutical Activities Involving ``Schedule 1'' Chemicals (Including 
``Schedule 1'' Chemicals Produced as Intermediates) During Calendar 
Year 2019

AGENCY: Bureau of Industry and Security, Commerce.

ACTION: Notice of inquiry.

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SUMMARY: The Bureau of Industry and Security (BIS) is seeking public 
comments on the impact that implementation of the Chemical Weapons 
Convention (CWC), through the Chemical Weapons Convention 
Implementation Act and the Chemical Weapons Convention Regulations 
(CWCR), has had on commercial activities involving ``Schedule 1'' 
chemicals during calendar year 2019. The purpose of this notice of 
inquiry is to collect information to assist BIS in its preparation of 
the annual certification to the Congress on whether the legitimate 
commercial activities and interests of chemical, biotechnology, and 
pharmaceutical firms are harmed by such implementation. This 
certification is required under Condition 9 of Senate Resolution 75 
(April 24, 1997), in which the Senate gave its advice and consent to 
the ratification of the CWC.

DATES: Comments must be received by March 16, 2020.

ADDRESSES: You may submit comments by any of the following methods 
(please refer to RIN 0694-XC055 in all comments and in the subject line 
of email comments):
     Federal rulemaking portal (http://www.regulations.gov)--
you can find this notice by searching on its regulations.gov docket 
number, which is BIS-2019-0028;
     Email: [email protected]--include the phrase 
``Schedule 1 Notice of Inquiry'' in the subject line;
     Fax: (202) 482-3355 (Attn: Willard Fisher);
     By mail or delivery to Regulatory Policy Division, Bureau 
of Industry and Security, U.S. Department of Commerce, Room 2099B, 14th 
Street and Pennsylvania Avenue NW, Washington, DC 20230.

FOR FURTHER INFORMATION CONTACT: For questions on the Chemical Weapons 
Convention requirements for ``Schedule 1'' chemicals, contact Douglas 
Brown, Treaty Compliance Division, Office of Nonproliferation and 
Treaty Compliance, Bureau of Industry and Security, U.S. Department of 
Commerce, Phone: (202) 482-2163. For questions on the submission of 
comments, contact Willard Fisher, Regulatory Policy Division, Office of 
Exporter Services, Bureau of Industry and Security, U.S. Department of 
Commerce, Phone: (202) 482-2440.

SUPPLEMENTARY INFORMATION: 

Background

    In providing its advice and consent to the ratification of the 
Convention on the Prohibition of the Development, Production, 
Stockpiling, and Use of Chemical Weapons and Their Destruction, 
commonly called the Chemical Weapons Convention (CWC or ``the 
Convention''), the Senate included, in Senate Resolution 75 (S. Res. 
75, April 24, 1997), several conditions to its ratification. Condition 
9, titled ``Protection of Advanced Biotechnology,'' calls for the 
President to certify to Congress on an annual basis that ``the 
legitimate commercial activities and interests of chemical, 
biotechnology, and pharmaceutical firms in the United States are not 
being significantly harmed by the limitations of the Convention on 
access to, and production of, those chemicals and toxins listed in 
Schedule 1.'' On July 8, 2004, President Bush, by Executive Order 
13346, delegated his authority to make the annual certification to the 
Secretary of Commerce.
    The CWC is an international arms control treaty that contains 
certain verification provisions. In order to implement these 
verification provisions, the CWC established the Organization for the 
Prohibition of Chemical Weapons (OPCW). In order to achieve the object 
and purpose of the Convention and the implementation of its provisions, 
the CWC imposes certain obligations on countries that have ratified the 
Convention (i.e., States Parties), among which are the enactment of 
legislation to prohibit the production, storage, and use of chemical 
weapons and the establishment of a National Authority to serve as the 
national focal point for effective liaison with the OPCW and other 
States Parties. The CWC also requires each State Party to implement a 
comprehensive data declaration and inspection regime to provide 
transparency and to verify that both the public and private sectors of 
the State Party are not engaged in activities prohibited under the CWC.
    ``Schedule 1'' chemicals consist of those toxic chemicals and 
precursors set

[[Page 8247]]

forth in the CWC ``Annex on Chemicals'' and in ``Supplement No. 1 to 
part 712--SCHEDULE 1 CHEMICALS'' of the Chemical Weapons Convention 
Regulations (CWCR) (15 CFR parts 710-722). The CWC identified these 
toxic chemicals and precursors as posing a high risk to the object and 
purpose of the Convention.
    The CWC (Part VI of the ``Verification Annex'') restricts the 
production of ``Schedule 1'' chemicals for protective purposes to two 
facilities per State Party: A single small-scale facility (SSSF) and a 
facility for production in quantities not exceeding 10 kg per year. The 
CWC Article-by-Article Analysis submitted to the Senate in Treaty Doc. 
103-21 defined the term ``protective purposes'' to mean ``used for 
determining the adequacy of defense equipment and measures.'' 
Consistent with this definition and as authorized by Presidential 
Decision Directive (PDD) 70 (December 17, 1999), which specifies agency 
and departmental responsibilities as part of the U.S. implementation of 
the CWC, the Department of Defense (DOD) was assigned the 
responsibility to operate these two facilities. DOD maintains strict 
controls on ``Schedule 1'' chemicals produced at its facilities in 
order to ensure accountability for such chemicals, as well as their 
proper use, consistent with the object and purpose of the Convention. 
Although this assignment of responsibility to DOD under PDD-70 
effectively precluded commercial production of ``Schedule 1'' chemicals 
for ``protective purposes'' in the United States, it did not establish 
any limitations on ``Schedule 1'' chemical activities that are not 
prohibited by the CWC.
    The provisions of the CWC that affect commercial activities 
involving ``Schedule 1'' chemicals are implemented in the CWCR (see 15 
CFR part 712) and in the Export Administration Regulations (EAR) (see 
15 CFR 742.18 and 15 CFR part 745), both of which are administered by 
the Bureau of Industry and Security (BIS). Pursuant to CWC 
requirements, the CWCR restrict commercial production of ``Schedule 1'' 
chemicals to research, medical, or pharmaceutical purposes. The CWCR 
prohibit commercial production of ``Schedule 1'' chemicals for 
``protective purposes'' because such production is effectively 
precluded per PDD-70, as described above. See 15 CFR 712.2(a).
    The CWCR also contain other requirements and prohibitions that 
apply to ``Schedule 1'' chemicals and/or ``Schedule 1'' facilities. 
Specifically, the CWCR:
    (1) Prohibit the import of ``Schedule 1'' chemicals from States not 
Party to the Convention (15 CFR 712.2(b));
    (2) Require annual declarations by certain facilities engaged in 
the production of ``Schedule 1'' chemicals in excess of 100 grams 
aggregate per calendar year (i.e., declared ``Schedule 1'' facilities) 
for purposes not prohibited by the Convention (15 CFR 712.5(a)(1) and 
(a)(2));
    (3) Provide for government approval of ``declared Schedule 1'' 
facilities (15 CFR 712.5(f));
    (4) Provide that ``declared Schedule 1'' facilities are subject to 
initial and routine inspection by the OPCW (15 CFR 712.5(e) and 
716.1(b)(1));
    (5) Require 200 days advance notification of the establishment of 
new ``Schedule 1'' production facilities producing greater than 100 
grams aggregate of ``Schedule 1'' chemicals per calendar year (15 CFR 
712.4);
    (6) Require advance notification and annual reporting of all 
imports and exports of ``Schedule 1'' chemicals to, or from, other 
States Parties to the Convention (15 CFR 712.6, 742.18(a)(1) and 
745.1); and
    (7) Prohibit the export of ``Schedule 1'' chemicals to States not 
Party to the Convention (15 CFR 742.18(a)(1) and (b)(1)(ii)).
    For purposes of the CWCR (see 15 CFR 710.1), ``production of a 
Schedule 1 chemical'' means the formation of ``Schedule 1'' chemicals 
through chemical synthesis, as well as processing to extract and 
isolate ``Schedule 1'' chemicals. The phrase ``production of a schedule 
1 chemical'' includes, in its meaning, the formation of a chemical 
through chemical reaction, including by a biochemical or biologically 
mediated reaction. ``Production of a Schedule 1 chemical'' is 
understood, for CWCR declaration purposes, to include intermediates, 
by-products, or waste products that are produced and consumed within a 
defined chemical manufacturing sequence, where such intermediates, by-
products, or waste products are chemically stable and therefore exist 
for a sufficient time to make isolation from the manufacturing stream 
possible, but where, under normal or design operating conditions, 
isolation does not occur.

Request for Comments

    In order to assist in determining whether the legitimate commercial 
activities and interests of chemical, biotechnology, and pharmaceutical 
firms in the United States are significantly harmed by the limitations 
of the Convention on access to, and production of, ``Schedule 1'' 
chemicals as described in this notice, BIS is seeking public comments 
on any effects that implementation of the CWC, through the Chemical 
Weapons Convention Implementation Act and the CWCR, has had on 
commercial activities involving ``Schedule 1'' chemicals during 
calendar year 2019. To allow BIS to properly evaluate the significance 
of any harm to commercial activities involving ``Schedule 1'' 
chemicals, public comments submitted in response to this notice of 
inquiry should include both a quantitative and qualitative assessment 
of the impact of the CWC on such activities.

Submission of Comments

    All comments must be submitted to one of the addresses indicated in 
this notice. The Department requires that all comments be submitted in 
written form. BIS will consider all comments received on or before 
March 16, 2020. All comments, including those comments containing any 
personally identifying information or information for which a claim of 
confidentially is asserted either in the comments or their transmittal 
emails, will be made available for public inspection and copying. 
Parties who wish to comment anonymously may do so by submitting their 
comments via Regulations.gov, leaving the fields that would identify 
the commenter blank and including no identifying information in the 
comment itself.

Richard E. Ashooh,
Assistant Secretary for Export Administration.
[FR Doc. 2020-02848 Filed 2-12-20; 8:45 am]
 BILLING CODE 3510-33-P