[Federal Register Volume 87, Number 56 (Wednesday, March 23, 2022)]
[Rules and Regulations]
[Pages 16396-16426]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-05629]



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DEPARTMENT OF STATE

22 CFR Parts 120, 121, 122, 123, 124, 125, 126, 127, 128, 129, and 
130

[Public Notice: 11657]
RIN 1400-AE27


International Traffic in Arms Regulations: Consolidation and 
Restructuring of Purposes and Definitions

AGENCY: Department of State.

ACTION: Interim final rule.

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SUMMARY: The Department of State is amending the International Traffic 
in Arms Regulations (ITAR) to better organize the purposes and 
definitions of the regulations. This rule consolidates and co-locates 
authorities, general guidance, and definitions.

DATES: 
    Effective date: This interim final rule is effective September 6, 
2022.
    Comment due date: The Department of State will accept comments on 
this interim final rule until May 9, 2022.

ADDRESSES: Interested parties may submit comments by one of the 
following methods:
     Email: [email protected] with the subject line, 
International Traffic in Arms Regulations: Definitions.
     Internet: At www.regulations.gov, search for this document 
using Docket DOS-2022-0004.

FOR FURTHER INFORMATION CONTACT: Sarah Heidema, Director, Office of 
Defense Trade Controls Policy, Department of State, telephone (202) 
663-1282; email [email protected]. ATTN: Regulatory Change, 
Consolidation of Definitions and Restructuring of Part 120.

SUPPLEMENTARY INFORMATION: The Directorate of Defense Trade Controls 
(DDTC), U.S. Department of State, administers the International Traffic 
in Arms Regulations (ITAR) (22 CFR parts 120-130). The regulations, 
codified as subchapter M of chapter I, title 22 of the Code of Federal 
Regulations (``the subchapter'') implement those authorities of the 
Arms Export Control Act (AECA) (22 U.S.C. 2751 et seq.) delegated to 
the Secretary of State pursuant to Executive Order 13637. This rule 
restructures part 120 of the ITAR to better organize the definitions 
previously found in that part and other locations throughout the ITAR 
and to consolidate provisions that provide background information or 
otherwise apply throughout the regulations. In addition, this rule adds 
text not previously found in the ITAR and makes clarifying revisions to 
existing text. This rule is intended to be the first in a series of 
rulemakings that will further streamline and clarify the subchapter. 
The Department makes the following revisions to the ITAR in this 
interim final rule:

Revisions of General Application

    Prior to this rulemaking, generally applicable information and 
definitions were spread throughout the subchapter. As a result of this 
rulemaking, part 120 is dividing into three subparts: Subpart A--
General Information; Subpart B--General Policies and Processes; and 
Subpart C--Definitions. The division into subparts is intended to 
provide the reader with a roadmap for the regulations. Subpart A--
General Information, consolidates and explains the legislative 
authority and purpose of the regulations to aid in understanding their 
importance and source. Subpart B--General Policies and Processes, 
outlines the general processes and policies of the ITAR. Finally, 
Subpart C--Definitions, provides a consolidated list of defined terms 
that are applicable throughout the ITAR. Part and section-specific 
information and definitions continue to be located in the applicable 
part or section of the regulations. DDTC notes that the definitions in 
subpart C are not included in alphabetical order. DDTC endeavored to 
include definitions in a logical order so as to provide larger 
conceptual definitions first, to keep like concepts together, to nest 
related definitions in single sections, and to match the framework of 
the regulations. DDTC believes that this structure outweighs any ease 
in finding a definition through the use of alphabetization, 
particularly considering modern methods of electronic search. Finally, 
DDTC believes that the relatively limited number of defined terms 
within the subchapter makes this subpart manageable in this way.
    DDTC is revising those sections affected by this rule that use 
acronyms to follow a standard format. Where a single term for which 
there is a known acronym appears on more than two occasions within any 
one section, the first instance is followed by a parenthetical 
containing the acronym and subsequent use of the term is by acronym. 
This will provide consistency of format without sacrificing clarity and 
limits unnecessary text.

Section-Specific Revisions

    The following descriptions explain non-editorial changes in text to 
sections in this rule. Further, when discussing amended text that also 
involves the movement of text to a new location or the creation of new 
text modeled on existing language, the former or existing location is 
provided. When discussing amended text below, citations are to the 
section cites of this rule (i.e., the new location). When discussing 
text that has been moved by this rule, the location of the text prior 
to this rule is referred to as its ``former'' location. When discussing 
a section or text that is not moved by this rule, the location is 
referred to as its ``existing'' location. The table at the conclusion 
of the preamble provides both the former and new ITAR citations for all 
relocations of regulatory text at the section or sentence level for 
assistance in associating new citations with former citations. It also 
identifies all existing (i.e., non-relocated) sections that have been 
revised. This rule does not amend or relocate any ITAR provisions not 
included in the table below. In order to maintain focus on changes to 
the text of the ITAR as it appeared prior to this rule and to the 
addition of new text to the subchapter and to minimize unnecessary 
explanation, the following preamble text does not describe the new 
location of the text formerly located in the section cites discussed. 
Persons interested in the movement of sections should review the table 
at the end of this section.

Section 120.1 General Authorities

    Revising the section heading of existing Sec.  120.1 from ``General 
authorities, receipt of licenses, and ineligibility'' to ``General 
Authorities'' to reflect the revised focus of the section. Revising the 
introductory paragraph of Sec.  120.1(a) to clarify the manner of 
delegation by the Secretary of State to the Deputy Assistant Secretary 
of State for Defense Trade Controls, Bureau of Political-Military 
Affairs of the authority to administer the ITAR.

Section 120.2 Designation of Defense Articles and Defense Services

    Revising the fifth sentence of existing Sec.  120.2 to include a 
limitation to defense articles and defense services ``on the USML in 
part 121 of this subchapter'' in order to account for the delegation to 
the Attorney General of the authority to designate defense articles and 
services subject to control for permanent import by section 1(n)(ii) of 
Executive Order 13637.

Section 120.4 Commodity Jurisdiction

    Revising existing Sec.  120.4 to limit it to a statement of policy, 
by relocating its procedural aspects. Former paragraphs (c) through (g) 
of Sec.  120.4, which provide

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information about the procedures and processes for submitting a 
commodity jurisdiction request, have been relocated to new Sec.  120.12 
titled Commodity Jurisdiction Determination Requests.

Section 120.5 Relation to Regulations of Other Agencies

    Revising the title of Sec.  120.5 to eliminate reference to export 
of items subject to the EAR in order to more accurately describe the 
scope of the revised section, which is expanded to include relation to 
nuclear related controls and the Department of Energy and Nuclear 
Regulatory Commission (formerly found at Sec.  123.20). In addition, 
revising Sec.  120.5 to provide introductory headings to each paragraph 
to identify the related agencies. Revising existing Sec.  120.5(a) by 
limiting its scope to the relation to the Department of Justice, moving 
the language regarding the relation to the Department of Commerce 
beginning at sentence 7 to a new paragraph (b), and by removing the 
cross-reference to former Sec.  123.20 which is no longer necessary 
given the addition of Sec.  120.5(c) (formerly found at Sec.  123.20). 
Revising Sec.  120.5(b)(2) (formerly Sec.  120.5(b)) by moving the 
sentence that says items subject to the Export Administration 
Regulations (EAR) but exported under authorization from DDTC do not 
require separate authorization from the Department of Commerce. That 
sentence now appears just before the sentence prohibiting the use of 
ITAR exemptions for items subject to the EAR that are unaccompanied by 
a defense article. DDTC believes this change minimizes possible 
confusion regarding requirements for Commerce approval and the use of 
ITAR exemptions. The change also clarifies that the reference to 
``these items'' in new sentence three applies to the items discussed in 
sentences one and two. Also, the final parenthetical to Sec.  120.5(b) 
is removed as an unnecessary restatement of general information.

Section 120.6 U.S. Criminal Statutes

    Revising Sec.  120.6(b) and (d) (formerly found at Sec.  
120.27(a)(2) and (4), respectively) to update U.S. Code citations to 
the Export Administration Act, to add a reference to the Export Control 
Reform Act, and to reflect the elimination of the Appendix to Title 50.

Section 120.10 Introduction to the U.S. Munitions List

    Revising in Sec.  120.10(a) (formerly found at Sec.  121.1(a)) 
reference from ``[i]n this part'' to ``part 121 of this subchapter'' in 
order to reflect the move of the ``Introduction to the U.S. Munitions 
List'' from part 121 to new subpart A. Revising the paragraph heading 
in Sec.  120.10(c) (formerly found at Sec.  121.1(a)(2) from 
``Significant Military Equipment.'' to ``Significant Military Equipment 
paragraphs in the USML.'' in order to more clearly distinguish the 
explanation of identifiers in the USML from the definition of 
significant military equipment at Sec.  120.36(a) (formerly found at 
Sec.  120.7(a)).

Section 120.11 Order of Review

    Adding in Sec.  120.11(c) a statement of the Department's 
interpretation that defense articles remain controlled following 
incorporation or integration into non-defense articles.

Section 120.12 Commodity Jurisdiction Determination Requests

    Revising Sec.  120.12 in its entirety from its former purpose as 
the address of the Directorate of Defense Trade Controls to a new 
purpose describing the process for obtaining a CJ determination. The 
revised section is constructed by moving parts of former Sec.  120.4(a) 
and all of Sec.  120.4(f) to Sec.  120.12(a) and former Sec.  120.4(c) 
and (d)(2) to Sec.  120.12(b). Specific reference to part 121 is added 
to paragraph (a) in order to clarify that DDTC determinations using the 
CJ process are limited to defense articles and services in that part. 
Persons with questions regarding the U.S. Munitions Import List (USMIL) 
should first address those questions to the Bureau of Alcohol, Tobacco, 
Firearms and Explosives. The references to ``designation'' (formerly 
found at Sec.  120.4(d)(2) and (3)) is revised to ``determination'' in 
Sec.  120.12(b) and (c) in order to minimize possible confusion 
regarding commodity jurisdiction determination requests. In addition, a 
reference to Category XXI (Articles, Technical Data, and Defense 
Services Not Otherwise Enumerated) is added to paragraph (c) in order 
to clarify that the determination of the request is that the article or 
service warrants control, but that at the time of the request the 
article or service does not meet the criteria of a defense article or 
defense service on the USML, or provide the equivalent performance 
capabilities of a defense article on the USML.
    Revising in Sec.  120.12(f) (formerly found at Sec.  120.4(b)) the 
statement regarding registration and the CJ process. The second 
sentence of former Sec.  120.4(b) regarding the requirement to register 
following a determination that a commodity is covered by the USML is 
removed from Sec.  120.12(f) as it is a duplicative statement of the 
general registration requirements found in part 122 and therefore 
unnecessary. Removal is for clarification purposes only and does not 
reflect a change in policy.

Section 120.13 Registration

    Adding in Sec.  120.13(b) a statement of registration policy 
regarding brokering derived from the requirements of Sec. Sec.  
129.2(a) and 129.3(a). This statement is for clarity and does not 
reflect a change in policy or regulation.

Section 120.14 Licenses and Related Authorizations

    Adding in Sec.  120.14 a general statement of policy regarding 
activities that are controlled and require a license or related 
authorization. Those activities are divided into three paragraphs: (a) 
Export, reexport, retransfer, or temporary import of defense articles, 
derived from existing Sec.  123.1(a); (b) furnishing or providing 
defense services, derived from existing Sec.  124.1(a); and (c) 
brokering activities, derived from existing Sec.  129.4(a). The general 
statement of policy is slightly revised from the language of the 
existing authorization sections in that it distinguishes between 
authorizations requiring a request for approval to be obtained from 
DDTC (i.e., the existing authorization sections), and the use of an 
exemption, for which no request is required to be submitted to DDTC.

Section 120.15 Exemptions

    Adding in Sec.  120.15(a) an explicit statement that persons 
otherwise required to register with DDTC may not utilize an exemption 
without being registered, derived from existing Sec.  120.1(c) and the 
Note to Sec.  122.1(b). Relocating to Sec.  120.15(b) the statement in 
former Sec.  120.1(d) that exemptions are not available when parties to 
the export are generally ineligible. Stating in Sec.  120.15(c) that 
exemptions generally are not available for use with Sec.  126.1 
countries, except as provided in that section. Stating in Sec.  
120.15(d) that exemptions are limited as described by each specific 
exemption section, and adding in Sec.  120.15(f) (formerly found in 
Sec.  125.6) an overview of the certification requirements to utilize 
an exemption to the licensing requirements of the ITAR for the export 
of technical data, which is removed and reserved.

Section 120.16 Eligibility for Approvals

    Revising in Sec.  120.16(a)(3) (formerly found at Sec.  
120.1(c)(1)(iii)) reference to brokering authorizations from ``prior 
approval'' to ``approval'' to reflect current usage in part 129. Adding 
in Sec.  120.16(c) (formerly found at Sec.  120.1(c)) a new reference 
to publicly announced

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Department of State policies regarding eligibility in order to address 
concerns regarding the use of exemptions and public awareness of the 
status of end-users or other consignees.

Section 120.17 End-Use Monitoring

    Adding in Sec.  120.17 a description of the Blue Lantern End-Use 
Monitoring program. This description did not previously appear in the 
ITAR, but is added here to provide an explanation to the regulated 
community of the Department's obligations pursuant to 22 U.S.C. 2785 to 
vet regulated transactions both before and after licensing 
determinations.

Section 120.18 Denial, Revocation, Suspension, or Amendment of Licenses 
and Other Approvals

    Revising in Sec.  120.18(a)(2) (formerly found at Sec.  
126.7(a)(2)) reference from ``Export Administration Act'' to ``Export 
Administration Regulations'' to more accurately reflect the mechanism 
through which the Department of Commerce authorizes exports. Revising 
in Sec.  120.18(a)(6) (formerly found at Sec.  126.7(a)(6)) reference 
from ``debarment'' to ``order denying export privileges'' in relation 
to Department of Commerce actions in order to reflect the language of 
the EAR. Adding in Sec.  120.18(a)(9) the statement that an unfavorable 
finding of an end-use monitoring check may be the basis for 
disapproving, revoking, suspending, or amending any existing license or 
license application.

Section 120.19 Violations and Penalties

    Adding in Sec.  120.19 a general statement in paragraph (a) of the 
authority to impose penalties for violations of the ITAR and a 
reference to part 127 (conduct that constitutes a violation), and in 
paragraph (b) a statement derived from existing Sec.  127.12(a) of the 
Department's encouragement of the voluntary disclosure of violations 
when discovered.

Section 120.20 Administrative Procedures

    Adding in Sec.  120.20 general statements (derived from revised 
language at existing Sec.  128.1) regarding administrative procedures 
under the ITAR and the relationship of the AECA to the Administrative 
Procedure Act, respectively.

Section 120.21 Disclosure of Information

    Removing in Sec.  120.21(b) (formerly found at Sec.  126.10(b)) 
reference to section 12(c) of the Export Administration Act, to 
streamline the text while restating the substantive requirements stated 
in the AECA.

Section 120.23 Organizations and Arrangements

    Creating in Sec.  120.23 a new grouping of various international 
organizations and arrangements. Revising in Sec.  120.23(a) (formerly 
found at Sec.  120.31) the description of NATO from a static list of 
member countries to include reference to admitted member states not 
listed. This will prevent unnecessary amendment to the section or 
public confusion regarding references to NATO in the ITAR and the 
status of member states. Adding in Sec.  120.23(c) reference to the 
Wassenaar Arrangement on Export Controls not formerly found in the 
subchapter. Removing in Sec.  120.23(d)(3) (formerly found at Sec.  
120.29(c)) an unnecessary reference to the relevant statutory authority 
regarding Missile Technology Control Regime items and the USML in order 
to streamline the text.

Section 120.37 Major Defense Equipment

    Revising Sec.  120.37 (formerly found at Sec.  120.8) to more 
closely follow the definitions structure by beginning the paragraph 
with the defined term.

Section 120.38 Classified

    Adding in Sec.  120.38 (formerly found at Sec.  120.46) the phrase 
``or predecessor order'' to the definition of classified to conform the 
single instance definition with the individual definitions of 
classified previously found within the individual categories of the 
USML. This change does not expand the applicable scope of the 
definition of classified. Corresponding changes are made to remove from 
Categories I through XXI of Sec.  121.1 individual ``Note to 
paragraph'' definitions of classified wherever found within the USML.

Section 120.40 Compositional Terms

    Revising the section heading from ``End-items, components, 
accessories, attachments, parts, firmware, software, systems, and 
equipment'' to ``Compositional terms'' to more accurately address the 
contents of the section (formerly found at Sec.  120.45). The section 
as formerly written included items that could be either an element of a 
defense article, or a defense article in and of itself, or might be a 
part (or component, etc.) of a defense article without being a defense 
article itself. In order to clarify that the section defines terms that 
can be used in relation to articles other than defense articles, the 
section heading is expanded. Other changes include: Adding in Sec.  
120.40 a new paragraph (a) to include a single instance definition of 
commodity, formerly found in Note to paragraphs (a) and (b) of Sec.  
120.41, in order to clarify its application throughout the ITAR; and 
revising the explanatory note to the definition of system in paragraph 
(h) (formerly found at Note to paragraph (g) of Sec.  120.45) in order 
to eliminate the redundant second sentence as unnecessary and to limit 
reference to the relevant source materials and delete the citations to 
outdated versions of those materials.

Section 120.41 Specially Designed

    Revising existing Sec.  120.41 to move from Sec.  120.41 those 
notes that contain definitions of broad applicability to single 
instance definitions in Sec. Sec.  120.42 and 120.43 and to make 
certain non-substantive revisions to the order and numbering of notes 
to the section in accordance with Code of Federal Regulations drafting 
requirements.

Section 120.42 Form, Fit, Function, Performance Capability, Equivalent, 
Enumerated, and Catch-All Control

    In Sec.  120.42 incorporating single instance definitions of form, 
fit, function, and performance capability (formerly found at Notes 1 
and 2 to paragraph (d) of Sec.  120.4 and Note 4 to paragraph (b)(3) of 
Sec.  120.41); and single instance definitions of equivalent, 
enumerated, and catch-all control (formerly found at Note 5 to 
paragraph (b)(3) and Note to paragraph (b) of Sec.  120.41). Revising 
in Sec.  120.42(f) (formerly found at Note to paragraph (b) of Sec.  
120.41) reference from ``article on the U.S. Munitions List'' to ``item 
designated on the U.S. Munitions List'' to more accurately reflect the 
constitution of the USML and to distinguish from the reference to 
``item'' in the same sentence as applied to the Export Administration 
Regulations.

Section 120.43 Development, Production, and Related Terms; Basic and 
Applied Research

    Adding in Sec.  120.43(a) and (b) single instance definitions of 
development and production formerly found in Sec.  120.41 specifically. 
These single instance definitions were originally included in a 
previous proposed rule (80 FR 31525, June 3, 2015), and were to be 
taken from existing Notes 2 and 1, respectively, to Sec.  120.41(b)(3). 
Although not adopted at that time, DDTC now implements the revision. In 
response to the 2015 proposed rule, the Department received several 
public comments regarding the single instance definitions for

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development and production. Those comments are addressed here.
    One commenter suggested that the department add ``but not limited 
to'' following ``such as'' in the definition of ``development.'' The 
Department does not make this change. The use of the term ``such as'' 
necessarily implies that the following list is non-exclusive, so the 
addition of the phrase ``but not limited to'' is redundant.
    Several commenters requested that the Department insert a note to 
the definition of ``development'' to state that fabrication of 
prototypes by universities for academic demonstration or to otherwise 
test a hypothesis is not development, because the inclusion of these 
activities within the definition of ``development'' somehow limits the 
fundamental research exception. The Department does not make this 
change. The Department believes that the activity is appropriately 
captured by the definition of ``development''.
    A commenter requested that the Department remove the last sentence 
of the definition of ``development,'' which stated ``[d]evelopment 
includes modification of the design of an existing item.'' The 
Department does not make this change. Modification of an existing 
design creates a distinct design, regardless of the modification.
    A commenter suggested that the Department add engineering analysis 
and design methodology to the definition of ``development'' in place of 
design analysis and design concepts, and add manufacturing know-how to 
the definition of ``production'' in place of manufacture. The 
Department does not make this change. The terms suggested by the 
commenter are used in specific places in the ITAR for specific 
purposes, and their inclusion within these definitions would not 
provide additional clarity. Additionally, the definitions of 
``development'' and ``production'' are being moved from within the 
definition of specially designed and made applicable to the entire 
ITAR, in part, to harmonize the definition of ``technical data'' with 
the definition of technology in the EAR. To modify these definitions 
would result in unnecessary variation from the EAR without significant 
benefit.
    One commenter suggested that the Department add the Defense Federal 
Acquisition Regulations Supplement (DFARS) term ``advanced 
technological development'' to the definition of ``development.'' The 
Department notes the actual term is ``advanced technology development'' 
and does not make this change. While any advanced technology 
development would be included within this definition of 
``development,'' the value of adding the DFARS term is outweighed by 
the loss of harmonization with the EAR and multilateral export control 
regimes.
    One commenter suggested that the Department replace the term 
``serial production'' with ``production.'' The Department does not make 
this change. Products generally pass through multiple phases of 
development, some of which may include the production of prototypes or 
prototype production facilities. All of these activities are included 
within the development phase of the products.
    Several commenters noted that the definition of ``production'' 
includes manufacture and assert that this creates a conflict with the 
definitions of ``manufacturing license agreement'' (MLA) and 
``technical assistance agreement'' (TAA) in Sec. Sec.  120.21 and 
120.22. The Department does not make any change. An MLA is an 
``authorization to manufacture defense articles abroad. . . .'' There 
may be an agreement that involves technical data for the production of 
a defense article that is not an ``authorization to manufacture defense 
articles abroad,'' and in these instances, an MLA would not be 
required. However, in instances where there is an ``authorization to 
manufacture defense articles abroad'' that involves the export of 
technical data, an MLA is required regardless of the type of technical 
data exported. One commenter noted that the provisions of Sec.  
124.4(b)(1) through (4) apply to agreements that involve coproduction 
or licensed production outside of the United States of defense articles 
of United States origin, and asserts that the new definition of 
``production'' may implicate some TAAs, in addition to MLAs. The 
commenter requested that Sec.  124.4(b) be revised to limit the scope 
of that provision to ``licensed manufacturing.'' The Department does 
not make this change. The reporting requirements of Sec.  124.4(b) 
apply only to ``coproduction or licensed production outside of the 
United States,'' which is only authorized via MLAs that involve 
offshore production. Additional revisions are not necessary.
    One commenter stated that the definitions would undermine the 
utility of the exemption at Sec.  125.4(b)(6), which authorizes the 
export of technical data ``related to firearms not in excess of caliber 
.50 and ammunition for such weapons, except detailed design, 
development, production or manufacturing information.'' The Department 
confirms that these definitions do not change the scope of this 
exemption.
    In reviewing the definition of development from the 2015 proposed 
rule, and not in response to public comment, the Department determined 
to revise the final sentence of the definition to focus on design 
rather than items. This is intended to be in keeping with the attempt 
to better align definitions across the EAR and ITAR, as expressed in 
the 2015 proposed rule, and to clarify that development is common to 
pre-production for all goods and is not specific to the USML. Although 
the final sentence of the definition of development is not found 
directly in the EAR definition of development, an analogous provision 
is found in Note 2 to the definition of technology (see 15 CFR 772.1).
    Adding in Sec.  120.43(c) through (i) single instance definitions 
and explanations of terms for design methodology, engineering analysis, 
manufacturing know-how, build-to-print, build/design-to-specification, 
basic research, and applied research (the definition of which was 
formerly found within the definition of basic research and which this 
rule separates into two definitions), formerly found at Sec. Sec.  
124.2(c)(4) and 125.4(c). Although formerly described in Sec. Sec.  
124.2(c)(4) and 125.4(c), for purposes of clarity as to the application 
of an exemption the terms were used in other locations in the ITAR, 
demonstrating that the explanations were intended to have broader 
applicability. Conforming changes are made to citation references in 
Category XIII(i)(6) of Sec.  121.1, Supplement No. 1 to part 126, and 
Note 5 and Note 12 to that supplement. In addition, revisions are made 
to existing Sec.  124.2(c)(4) to eliminate the unnecessary duplication 
of definitions of design methodology, engineering analysis, and 
manufacturing know-how by deleting existing Sec.  124.2(c)(4)(i) 
through (iii). Also, the parenthetical explanation of build-to-print at 
existing Sec.  124.13(b) is removed for the same reason.

Section 120.57 Authorization Types

    In Sec.  120.57 consolidating and incorporating single instance 
definitions for the various authorization types for transactions 
subject to the ITAR (formerly found in Sec. Sec.  120.20, 120.21, 
120.22 and 120.23) and adding in Sec.  120.57(c) a single instance 
definition of exemption to provide a single reference for the concept, 
used throughout the ITAR, for an authorization other than by license or 
other written approval.

[[Page 16400]]

Section 120.68 Party to the Export

    Establishing in Sec.  120.68 (formerly found at Sec.  126.7(e)) a 
single instance definition of ``party to the export''.

Part 121 The United States Munitions List

    Adding a new Sec.  121.0 to provide cross-reference to Sec. Sec.  
120.10 and 120.11, Introduction to the U.S. Munitions List and Order of 
review, respectively (formerly found at paragraphs (a) and (b) of Sec.  
121.1). Removing and reserving paragraphs (a) and (b) of Sec.  121.1. 
Revising for purpose of consistency only the technical data and defense 
service definition parentheticals in the technical data paragraphs for 
all categories previously revised as part of the multi-year process of 
reviewing and revising the USML as part of the USML to the Commerce 
Control List (CCL) process, beginning with 78 FR 22740, Apr. 16, 2013. 
These revisions are not intended to make any substantive change. 
Previously, these paragraphs used ``see'' and ``as defined in'' 
interchangeably. Removing from the USML those notes to category 
paragraphs that contain definitions for ``classified'' in order to 
preclude any variation from the definition of classified in Sec.  
120.38 (formerly found at Sec.  120.46). Removing the parentheticals 
``(see Sec.  120.4 of this subchapter)'' relating to commodity 
jurisdiction, ``(see Sec.  120.42 of this subchapter)'' relating to 
``subject to the EAR'', and the phrase ``(see Sec.  120.10(a)(2) of 
this subchapter)'' relating to ``classified'' as they are either used 
inconsistently or because they are generally understood by the 
regulated community and defined elsewhere in the regulations. Finally, 
cross-references to sections moved by this rule are updated.

Section 128.1 Exclusion of Functions From the Administrative Procedure 
Act

    Revising Sec.  128.1 to clarify that the Secretary of State has 
been delegated authority to make licensing decisions.

Section 128.2 Administrative Law Judge

    Revising Sec.  128.2 regarding authorities of an Administrative Law 
Judge to eliminate reference to Sec.  127.7. This change clarifies that 
an Administrative Law Judge may only recommend debarment pursuant to 
that section, and any such order is issued by the Assistant Secretary 
of State for Political-Military Affairs.

Other Revisions

    Removing and reserving Sec.  120.26, Presiding Official, as 
unnecessary as the term does not otherwise appear in the regulations.
    Removing the list of forms referenced in the ITAR and formerly 
found at Sec.  120.28. This section, which provides the list of forms 
referred to in the ITAR, is being removed in its entirety as an 
unnecessary inclusion to the regulations. Due to previous revisions to 
the regulations, the list presented is not accurate. In order to 
prevent unnecessary regulatory activity in the form of future 
conforming revisions to the section, due to expected changes to the 
forms that appear in the regulations, it is being removed and the 
section reserved.
    Reserving Sec.  120.29 (formerly Missile Technology Control Regime) 
and moving the former text of Sec.  120.29 to paragraph (d) of new 
Sec.  120.23, Organizations and arrangements.
    Reserving Sec.  120.46 (formerly Classified) and moving the former 
text of Sec.  120.46 to new Sec.  120.38.
    Reserving Sec.  123.20 (formerly Nuclear related controls) and 
moving the former text of Sec.  123.20 to new Sec.  120.5(c).
    Reserving Sec.  123.26 (formerly Recordkeeping for exemptions) and 
moving the requirements of the former Sec.  123.26 to new Sec.  
120.15(e).
    Reserving Sec.  125.6 (formerly Certification requirements for 
exemptions) and moving and revising the former text of Sec.  125.6 as 
described in the discussion of Sec.  120.15 above.
    Reserving Sec.  126.7 (formerly Denial, revocation, suspension, or 
amendment of licenses and other approvals) and moving the former text 
of Sec.  126.7(a)-(d) and (e) to new Sec. Sec.  120.18 and 120.68, 
respectively.
    Reserving Sec.  126.9 (formerly Advisory opinions and related 
authorizations) and moving the former text of Sec.  126.9 to new Sec.  
120.22.
    Reserving Sec.  126.10 (formerly Disclosure of information) and 
moving the former text of Sec.  126.10 to new Sec.  120.21.
    Reserving Sec. Sec.  126.11 and 126.12 (formerly Relations to other 
provisions of law, and Continuation in force, respectively) and moving 
the former text of each to new Sec.  120.7(a) and (b), respectively.
    Removing in its entirety the MTCR Annex formerly found at Sec.  
121.16, as the relevant information of the MTCR Annex is conveyed 
directly through notations in the USML and to eliminate unnecessary 
sections of the ITAR and the obligation to amend to reflect revisions 
to the MTCR Annex in both the USML and in former Sec.  121.16, in 
conjunction with the adoption of reference to the Missile Technology 
Control Regime in new Sec.  120.23(d).
    Revising references to ``U.S. Government'' from ``U.S. government'' 
at Sec. Sec.  120.11(d), 120.18(a)(6), and 120.34(a)(7).
    Revising order and numbering of notes to affected sections in 
accordance with Code of Federal Regulations drafting requirements.
    Revising formatting of cites and signals wherever found for 
consistency of application.
    The following former paragraphs of the ITAR were marked as reserved 
and are removed by this rule: Sec. Sec.  120.27(a)(11), 120.27(b), and 
125.4(d).
    Definitions of general applicability from throughout the subchapter 
are consolidated in Part 120--Purpose and Definitions, Subpart C--
Definitions. These movements are identified in the table below. Cross 
references are revised throughout the subchapter and efforts were made 
to standardize certain terminologies (e.g., reference to ``subject to 
the ITAR'' revised to the more commonly used ``subject to this 
subchapter'') and in the use of abbreviations and acronyms.
    This rule primarily moves and reorganizes existing regulatory text 
without revision. Much of this text was drafted at different times, by 
different authors. The Department intends to propose additional 
revisions to regulatory text to improve readability and flow.
    The table below identifies to the sentence level all:

    1. Movements or renumbering of text made by this rule from their 
former location to the location as effected by this rule. The former 
location of moved text is italicized.
    2. All text revised in any manner by this rule, whether moved or 
not. Revised sections, paragraphs, and text locations appear in 
bold.
    3. All text removed/reserved from the ITAR in any location. 
Removed sections, paragraphs, and text locations appear as 
strikethrough.
    4. Any new general information text sections that are derived 
from an existing ITAR section which is not revised or removed are 
identified in the ``Model for'' column and the source material 
identified by underlined text.
    5. Where a section or paragraph is moved, revised, and/or formed 
the basis for new text elsewhere, it is identified by each font type 
(e.g., the text of Sec.  123.26 is revised and moved and the section 
reserved, so it appears in the table as bold struck through text).
    6. Each level (to the sentence) of any section affected by this 
rule is identified by a unique row and then by font type within the 
row. For example, the first six rows of the table identify changes 
to Sec.  120.1. Row 1 shows Sec.  120.1 in bold, indicating a change 
to the text of the section title. Row two shows paragraph (a) in 
bold, indicating a change to the text of that paragraph. Row three 
shows

[[Page 16401]]

paragraph (b) in bold, indicating a change to the text of that 
paragraph. Row four shows paragraph (1) under paragraph (b) in bold, 
indicating a change to the text of paragraph (b)(1). Row five shows 
paragraph (ii) in bold and paragraph (2) in regular text under 
paragraph (b), indicating a change in text to paragraph (b)(2)(ii), 
but no change to the text of paragraph (b)(2) itself. Finally, row 
six shows paragraph (c) in italic and underlined, indicating that 
the paragraph has been moved (but not revised) and relocated to 
post-rule location Sec.  120.16 as well as providing the basis for 
new text at Sec.  120.15(b). Subsequent rows show the new locations 
of paragraphs within prior Sec.  120.1(c).
    7. Where consecutive paragraphs within a section are affected in 
the same manner, they are combined into a single row. See, e.g., 
Sec.  120.9, where paragraph (a)(1) is in a single row and 
identified in italic as having been moved to Sec.  120.32(a)(1), and 
paragraphs (a)(2) and (3) are in a single row and both identified in 
bold and italic as having been revised and moved to Sec.  
120.32(a)(2) and (3).
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BILLING CODE 4710-25-C

Regulatory Analysis and Notices

Administrative Procedure Act

    The Department of State is of the opinion that controlling the 
import and export of defense articles and services is a military or 
foreign affairs function of the United States Government and that rules 
implementing this function are exempt from sections 553 (rulemaking) 
and 554 (adjudications) of the Administrative Procedure Act (APA). 
Although the Department is of the opinion that this interim final rule 
is exempt from the rulemaking provisions of the APA, the Department is 
publishing this rule as an interim final rule and with a 45-day 
provision for public comment and without prejudice to its determination 
that controlling the import and export of defense services is a foreign 
affairs function.

Regulatory Flexibility Act

    Since the Department is of the opinion that this interim final rule 
is exempt from the provisions of 5 U.S.C. 553, there is no requirement 
for an analysis under the Regulatory Flexibility Act.

Unfunded Mandates Reform Act of 1995

    This amendment does not involve a mandate that will result in the 
expenditure by State, local, and tribal governments, in the aggregate, 
or by the private sector, of $100 million or more in any year and it 
will not significantly or uniquely affect small governments. Therefore, 
no actions were deemed necessary under the provisions of the Unfunded 
Mandates Reform Act of 1995.

Congressional Review Act

    This rulemaking has been found not to be a major rule within the 
definition of Small Business Regulatory Enforcement Fairness Act of 
1996.

Executive Orders 12372 and 13132

    This rulemaking will not have substantial direct effects on the 
States, on the relationship between the national government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government. Therefore, in accordance with Executive 
Order 13132, it is determined that this rulemaking does not have 
sufficient federalism implications to require consultations or warrant 
the preparation of a federalism summary impact statement. The 
regulations implementing Executive Order 12372 regarding 
intergovernmental consultation on Federal programs and activities do 
not apply to this rulemaking.

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess 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, distributed impacts, and equity). These executive orders 
stress the importance of quantifying both costs and benefits, of 
reducing costs, of harmonizing rules, and of promoting flexibility. 
Although the Department is of the opinion that this rulemaking is 
exempt from Executive Order 12866 as this rule pertains to a military 
or foreign affairs function of the United States as provided in Section 
3(d)(2), the Department nevertheless has determined that, given the 
nature of the amendments made in this rulemaking, there will be no 
change to any person's substantive rights or obligations as a result of 
this rule, and the only cost to the public, the cost of updating 
compliance regimes to account for the movement of regulatory text 
within the ITAR, is less than the benefit to the public in the 
increased utility of the ITAR. Therefore, the benefits of this 
rulemaking outweigh the cost. This rule has been designated a 
``significant regulatory action,'' although not economically 
significant, by the Office and Information and Regulatory Affairs under 
Executive Order 12866.

Executive Order 12988

    The Department of State reviewed this rulemaking in light of 
sections 3(a) and 3(b)(2) of Executive Order 12988 to eliminate 
ambiguity, minimize litigation, establish clear legal standards, and 
reduce burden.

Executive Order 13175

    The Department of State determined that this rulemaking will not 
have tribal implications, will not impose substantial direct compliance 
costs on Indian tribal governments, and will not preempt tribal law. 
Accordingly, Executive Order 13175 does not apply to this rulemaking.

Paperwork Reduction Act

    This rule does not impose any new reporting or recordkeeping 
requirements subject to the Paperwork Reduction Act, 44 U.S.C. Chapter 
35.

List of Subjects

22 CFR Parts 120, 121, and 125

    Arms and munitions, Classified information, Exports.

22 CFR Parts 122 and 123

    Arms and munitions, Exports, Reporting and recordkeeping.

22 CFR Part 124

    Arms and munitions, Exports, Technical assistance.

22 CFR Part 126

    Arms and munitions, Exports.

22 CFR Part 127

    Arms and munitions, Crime, Exports, Penalties, Seizures and 
forfeitures.

[[Page 16411]]

22 CFR Part 128

    Administrative practice and procedure, Arms and munitions, Exports.

22 CFR Part 129

    Arms and munitions, Brokers, Exports.

22 CFR Part 130

    Arms and munitions, Campaign funds, Confidential business 
information, Exports, Reporting and recordkeeping requirements.

Amendatory Instructions

    Accordingly, for the reasons set forth above and under the 
authority of 22 U.S.C. 2778, and 22 U.S.C. 2779, the Department of 
State amends title 22, chapter I, subchapter M, parts 120 through 130 
as follows:

0
1. Part 120 is revised to read as follows:

PART 120--PURPOSE AND DEFINITIONS

Subpart A--General Information

Sec.
120.1 General authorities.
120.2 Designation of defense articles and defense services.
120.3 Policy on designating or determining defense articles and 
services on the U.S. Munitions List.
120.4 Commodity jurisdiction.
120.5 Relation to regulations of other agencies.
120.6 U.S. criminal statutes.
120.7 Relations to other provisions of law.
120.8-120.9 [Reserved]
Subpart B--General Policies and Processes
120.10 Introduction to the U.S. Munitions List.
120.11 Order of review.
120.12 Commodity jurisdiction determination requests.
120.13 Registration.
120.14 Licenses and related authorizations.
120.15 Exemptions.
120.16 Eligibility for approvals.
120.17 End-use monitoring.
120.18 Denial, revocation, suspension, or amendment of licenses and 
other approvals.
120.19 Violations and penalties.
120.20 Administrative procedures.
120.21 Disclosure of information.
120.22 Advisory opinions and related authorizations.
120.23 Organizations and arrangements.
120.24-120.29v [Reserved]
Subpart C--Definitions
120.30 Directorate of Defense Trade Controls.
120.31 Defense article.
120.32 Defense service.
120.33 Technical data.
120.34 Public domain.
120.35 [Reserved]
120.36 Significant military equipment.
120.37 Major defense equipment.
120.38 Classified.
120.39 Foreign defense article or defense service.
120.40 Compositional terms.
120.41 Specially designed.
120.42 Form, fit, function, performance capability, equivalent, 
enumerated, and catch-all control.
120.43 Development, production, and related terms; Basic and applied 
research.
120.44 [Reserved]
120.45 Maintenance levels.
120.46-120.49 [Reserved]
120.50 Export.
120.51 Reexport.
120.52 Retransfer.
120.53 Temporary import.
120.54 Activities that are not exports, reexports, retransfers, or 
temporary imports.
120.55 Access information.
120.56 Release.
120.57 Authorization types.
120.58 Subject to the Export Administration Regulations (EAR).
120.59 [Reserved]
120.60 United States.
120.61 Person.
120.62 U.S. person.
120.63 Foreign person.
120.64 Regular employee.
120.65 Foreign ownership and foreign control.
120.66 Affiliate.
120.67 Empowered official.
120.68 Party to the export.
120.69 Port Directors.

    Authority: 22 U.S.C. 2651a, 2752, 2753, 2776, 2778, 2779, 2779a, 
2785, 2794, 2797; E.O. 13637, 78 FR 16129, 3 CFR, 2013 Comp., p. 
223.

Subpart A--General Information


Sec.  120.1   General authorities.

    (a) Authority and delegation. Section 38 of the Arms Export Control 
Act (22 U.S.C. 2778), as amended, authorizes the President to control 
the export and import of defense articles and defense services. The 
statutory authority of the President to promulgate regulations with 
respect to exports of defense articles and defense services is 
delegated to the Secretary of State by Executive Order 13637. This 
subchapter implements that authority, as well as other relevant 
authorities in the Arms Export Control Act (22 U.S.C. 2751 et seq.). 
The Secretary of State delegates the authority to administer the 
regulations in this subchapter to the Deputy Assistant Secretary of 
State for Defense Trade Controls, Bureau of Political-Military Affairs.
    (b) Authorized officials. (1) All authorities administered by the 
Deputy Assistant Secretary of State for Defense Trade Controls pursuant 
to this subchapter may be exercised at any time by the Under Secretary 
of State for Arms Control and International Security or the Assistant 
Secretary of State for Political-Military Affairs.
    (2) The Deputy Assistant Secretary of State for Defense Trade 
Controls supervises the Directorate of Defense Trade Controls, which is 
comprised of the following offices:
    (i) The Office of Defense Trade Controls Licensing and the 
Director, Office of Defense Trade Controls Licensing, which have 
responsibilities related to licensing or other approvals of defense 
trade, including references under this part and parts 123, 124, 125, 
126, 129, and 130 of this subchapter.
    (ii) The Office of Defense Trade Controls Compliance and the 
Director, Office of Defense Trade Controls Compliance, which have 
responsibilities related to violations of law or regulation and 
compliance therewith, including references contained in parts 122, 126, 
127, 128, and 130 of this subchapter, and those portions under this 
part and part 129 of this subchapter pertaining to registration.
    (iii) The Office of Defense Trade Controls Policy and the Director, 
Office of Defense Trade Controls Policy, which have responsibilities 
related to the general policies of defense trade, including references 
under this part and part 126 of this subchapter, and the commodity 
jurisdiction procedure under this part.


Sec.  120.2  Designation of defense articles and defense services.

    The Arms Export Control Act (22 U.S.C. 2778(a) and 2794(7)) 
provides that the President shall designate the articles and services 
deemed to be defense articles and defense services for purposes of 
import or export controls. The President has delegated to the Secretary 
of State the authority to control the export and temporary import of 
defense articles and services. The items designated by the Secretary of 
State for purposes of export and temporary import control constitute 
the U.S. Munitions List (USML) specified in part 121 of this 
subchapter. Defense articles on the USML specified in part 121 of this 
subchapter that are also subject to permanent import control by the 
Attorney General on the U.S. Munitions Import List enumerated in 27 CFR 
part 447 are subject to temporary import controls administered by the 
Secretary of State. Designations of defense articles and defense 
services on the USML in part 121 of this subchapter are made by the 
Department of State with the concurrence of the Department of Defense. 
The scope of the USML shall

[[Page 16412]]

be changed only by amendments made pursuant to section 38 of the Arms 
Export Control Act (22 U.S.C. 2778). For a designation or determination 
on whether a particular item is enumerated on the USML, see Sec.  
120.4.


Sec.  120.3   Policy on designating or determining defense articles and 
services on the U.S. Munitions List.

    (a) For purposes of this subchapter, a specific article or service 
may be designated a defense article (see Sec.  120.31) or defense 
service (see Sec.  120.32) if it:
    (1) Meets the criteria of a defense article or defense service on 
the U.S. Munitions List (USML) (part 121 of this subchapter); or
    (2) Provides the equivalent performance capabilities of a defense 
article on the USML.
    (b) For purposes of this subchapter, a specific article or service 
shall be determined in the future as a defense article or defense 
service if it provides a critical military or intelligence advantage 
such that it warrants control under this subchapter.

    Note 1 to paragraphs (a) and (b): An article or service 
determined in the future pursuant to this subchapter as a defense 
article or defense service, but not currently on the USML, will be 
placed in Category XXI of Sec.  121.1 of this subchapter until the 
appropriate category of the USML has been amended to provide the 
necessary entry.

    (c) A specific article or service is not a defense article or 
defense service for purposes of this subchapter if it:
    (1) Is determined to be under the jurisdiction of another 
department or agency of the U.S. Government (see Sec.  120.5) pursuant 
to a commodity jurisdiction determination (see Sec.  120.4) unless 
superseded by changes to the USML or by a subsequent commodity 
jurisdiction determination; or
    (2) Meets one of the criteria of Sec.  120.41(b) when the article 
is used in or with a defense article and specially designed is used as 
a control criteria.

    Note 2 to Sec.  120.3: The intended use of the article or 
service after its export (i.e., for a military or civilian purpose), 
by itself, is not a factor in determining whether the article or 
service is subject to the controls of this subchapter.

Sec.  120.4  Commodity jurisdiction.

    (a) The commodity jurisdiction procedure is used with the U.S. 
Government if doubt exists as to whether an article or service is 
covered by the U.S. Munitions List (USML). It may also be used for 
consideration of a redesignation of an article or service currently 
covered by the USML. The Department must provide notice to Congress at 
least 30 days before any item is removed from the USML.
    (b) The procedure for submitting a Commodity Jurisdiction 
Determination Request to the Directorate of Defense Trade Controls is 
set forth in Sec.  120.12.


Sec.  120.5   Relation to regulations of other agencies.

    (a) The Department of Justice, the U.S. Munitions Import List 
(USMIL), and permanent imports. Defense articles and defense services 
covered by the U.S. Munitions List set forth in this subchapter are 
regulated by the Department of State (see also Sec.  120.2) for 
purposes of export, reexport, retransfer, and temporary import. The 
President has delegated the authority to control the permanent import 
of defense articles and services to the Attorney General. The defense 
articles and services controlled by the Secretary of State and the 
Attorney General collectively comprise the U.S. Munitions List under 
the Arms Export Control Act. As the Attorney General exercises 
independent delegated authority to designate defense articles and 
services for purposes of permanent import controls, the permanent 
import control list administered by the Department of Justice has been 
separately labeled the U.S. Munitions Import List (27 CFR part 447) to 
distinguish it from the list set out in this subchapter. In carrying 
out the functions delegated to the Attorney General pursuant to the 
Arms Export Control Act, the Attorney General shall be guided by the 
views of the Secretary of State on matters affecting world peace and 
the external security and foreign policy of the United States.
    (b) The Department of Commerce and the Export Administration 
Regulations--(1) Export of items subject to the Export Administration 
Regulations by authority of the Department of Commerce. The Department 
of Commerce regulates the export, reexport, and in-country transfer of 
items on the Commerce Control List and other items subject to its 
jurisdiction, as well as certain activities performed by U.S. persons, 
including those that may contribute to the proliferation of weapons of 
mass destruction, under the Export Administration Regulations (EAR) (15 
CFR parts 730 through 774).
    (2) Export of items subject to the EAR by authority of the 
Department of State. A license or other approval (see Sec.  120.57) 
from the Department of State granted in accordance with this subchapter 
may also authorize the export of items subject to the EAR (see Sec.  
120.58). An exemption (see Sec.  120.57 and parts 123, 124, 125, and 
126 of this subchapter) may only be used to export an item subject to 
the EAR that is for use in or with a defense article and is included in 
the same shipment as any defense article. Separate approval from the 
Department of Commerce is not required for these items. No exemption 
under this subchapter may be utilized to export an item subject to the 
EAR if not accompanied by a defense article. Those items subject to the 
EAR exported pursuant to a Department of State license or other 
approval would remain under the jurisdiction of the Department of 
Commerce for any subsequent transactions. The inclusion of items 
subject to the EAR on a Department of State license or other approval 
does not change the licensing jurisdiction of the items.
    (c) Nuclear related controls; Department of Energy and the Nuclear 
Regulatory Commission. (1) The provisions of this subchapter do not 
apply to articles, technical data, or services in Category VI, Category 
XV, Category XVI, and Category XX of Sec.  121.1 of this subchapter to 
the extent that exports of such articles, technical data, or services 
are controlled by the Department of Energy or the Nuclear Regulatory 
Commission pursuant to the Atomic Energy Act of 1954 (AEA), as amended, 
and the Nuclear Non-Proliferation Act of 1978, as amended, or are 
government transfers authorized pursuant to these Acts. For Department 
of Commerce controls, see 15 CFR 742.3 and 744.2, administered pursuant 
to Section 309(c) of the Nuclear Nonproliferation Act of 1978, as 
amended (42 U.S.C. 2139a(c)), and 15 CFR 744.5, which are not subject 
to this subchapter.
    (2) The transfer of materials, including special nuclear materials, 
nuclear parts of nuclear weapons, or other, non-nuclear parts of 
nuclear weapons systems involving Restricted Data or of assistance 
involving any person directly or indirectly engaging in the production 
or use thereof is prohibited except as authorized by the AEA. The 
transfer of Restricted Data or such assistance is prohibited except as 
authorized by the AEA. The technical data or defense services relating 
to nuclear weapons, nuclear weapons systems or related defense purposes 
(and such data or services relating to applications of atomic energy 
for peaceful purposes, or related research and development) may 
constitute Restricted Data or such assistance, subject to the foregoing 
prohibition.
    (3) A license for the export of a defense article, technical data, 
or the furnishing of a defense service relating to defense articles 
referred to in

[[Page 16413]]

Category VI(e) or Category XX(b)(1) of Sec.  121.1 of this subchapter 
will not be granted unless the defense article, technical data, or 
defense service comes within the scope of an existing Agreement for 
Cooperation for Mutual Defense Purposes concluded pursuant to the AEA 
with the government of the country to which the defense article, 
technical data, or defense service is to be exported. Licenses may be 
granted in the absence of such an agreement only:
    (i) If the proposed export involves an article which is identical 
to that in use in an unclassified civilian nuclear power plant;
    (ii) If the proposed export has no relationship to naval nuclear 
propulsion; and
    (iii) If it is not for use in a naval propulsion plant.


Sec.  120.6   U.S. criminal statutes.

    For purposes of this subchapter, the phrase U.S. criminal statutes 
comprises the following:
    (a) Section 38 of the Arms Export Control Act (22 U.S.C. 2778);
    (b) Section 1760 of the Export Control Reform Act of 2018 (50 
U.S.C. 4819) or section 11 of the Export Administration Act of 1979 (50 
U.S.C. 4610);
    (c) Section 793, 794, or 798 of title 18, United States Code 
(relating to espionage involving defense or classified information) or 
section 2332d, 2339A, 2339B, 2339C, or 2339D of such title (relating to 
financial transactions with the government of a country designated as a 
country supporting international terrorism, providing material support 
to terrorists or terrorist organizations, financing of terrorism, or 
receiving military-type training from a foreign terrorist 
organization);
    (d) Section 16 of the Trading with the Enemy Act (50 U.S.C. 4315);
    (e) Section 206 of the International Emergency Economic Powers Act 
(relating to foreign assets controls; 50 U.S.C. 1705);
    (f) Section 30A of the Securities Exchange Act of 1934 (15 U.S.C. 
78dd-1) or section 104 of the Foreign Corrupt Practices Act (15 U.S.C. 
78dd-2 or 78dd-3);
    (g) Chapter 105 of title 18, United States Code (relating to 
sabotage);
    (h) Section 4(b) of the Internal Security Act of 1950 (relating to 
communication of classified information; 50 U.S.C. 783(a));
    (i) Sections 57, 92, 101, 104, 222, 224, 225, or 226 of the Atomic 
Energy Act of 1954 (42 U.S.C. 2077, 2122, 2131, 2134, 2272, 2274, 2275, 
and 2276);
    (j) Section 601 of the National Security Act of 1947 (relating to 
intelligence identities protection; 50 U.S.C. 421);
    (k) Section 371 of title 18, United States Code (when it involves 
conspiracy to violate any of the statutes listed in this section);
    (l) Sections 3, 4, 5, and 6 of the Intelligence Reform and 
Terrorism Prevention Act of 2004, Public Law 108-458 sections 6903-
6906, relating to missile systems designed to destroy aircraft (18 
U.S.C. 2332g), prohibitions governing atomic weapons (42 U.S.C. 2122), 
radiological dispersal services (18 U.S.C. 2332h), and variola virus 
(18 U.S.C. 175c);
    (m) Sections 2779 and 2780 of title 22, United States Code 
(relating to fees of military sales agents and other payments, and 
transactions with countries supporting acts of international 
terrorism);
    (n) Section 542 of title 18, United States Code (relating to the 
entry of goods by means of false statements), where the underlying 
offense involves a defense article, including technical data, or 
violations related to the Arms Export Control Act (AECA) or 
International Traffic in Arms Regulations (ITAR) in this subchapter;
    (o) Section 545 of title 18, United States Code (relating to 
smuggling goods into the United States), where the underlying offense 
involves a defense article, including technical data, or violations 
related to the AECA or ITAR;
    (p) Section 554 of title 18, United States Code (relating to 
smuggling goods from the United States), where the underlying offense 
involves a defense article, including technical data, or violations 
related to the AECA or ITAR; and
    (q) Section 1001 of title 18, United States Code (relating to false 
statements or entries generally), Section 1831 of title 18, United 
States Code (relating to economic espionage), and Section 1832 of title 
18, United States Code (relating to theft of trade secrets) where the 
underlying offense involves a defense article, including technical 
data, or violations related to the AECA or ITAR.


Sec.  120.7   Relations to other provisions of law.

    (a) The provisions in this subchapter are in addition to, and are 
not in lieu of, any other provisions of law or regulations. The sale of 
firearms in the United States, for example, remains subject to the 
provisions of the Gun Control Act of 1968 and regulations administered 
by the Department of Justice. The performance of defense services on 
behalf of foreign governments by retired military personnel continues 
to require consent pursuant to part 3a of this title. Persons who 
intend to export defense articles or furnish defense services should 
not assume that satisfying the requirements of this subchapter relieves 
one of other requirements of law.
    (b) All determinations, authorizations, licenses, approvals of 
contracts and agreements, and other action issued, authorized, 
undertaken, or entered into by the Department of State pursuant to 
section 414 of the Mutual Security Act of 1954, as amended, or under 
the previous provisions of this subchapter, continue in full force and 
effect until or unless modified, revoked, or superseded by the 
Department of State.


Sec. Sec.  120.8-120.9   [Reserved]

Subpart B--General Policies and Processes


Sec.  120.10  Introduction to the U.S. Munitions List.

    (a) The U.S. Munitions List. The articles, services, and related 
technical data designated as defense articles or defense services 
pursuant to sections 38 and 47(7) of the Arms Export Control Act appear 
in part 121 of this subchapter and constitute the U.S. Munitions List 
(USML). Changes in designations are published in the Federal Register. 
Paragraphs (b) through (d) of this section describe or explain the 
elements of a USML category.
    (b) Composition of U.S. Munitions List categories. USML categories 
are organized by paragraphs and subparagraphs identified 
alphanumerically. They usually start by enumerating or otherwise 
describing end-items, followed by major systems and equipment; parts, 
components, accessories, and attachments; and technical data and 
defense services directly related to the defense articles of that USML 
category.
    (c) Significant Military Equipment paragraphs in the USML. All 
items described within a USML paragraph or subordinate paragraph that 
is preceded by an asterisk (*) are designated Significant Military 
Equipment (SME). Note that technical data directly related to the 
manufacture or production of a defense article designated as SME is 
also designated as SME.
    (d) Missile Technology Control Regime (MTCR) designation. 
Annotation with the parenthetical (MT) at the end of a USML entry 
indicates those defense articles that are on the MTCR Annex.


Sec.  120.11   Order of review.

    (a) Control. Articles are controlled on the U.S. Munitions List 
(USML) because they are either:
    (1) Enumerated in a category; or
    (2) Described in a catch-all paragraph that incorporates specially 
designed as a

[[Page 16414]]

control parameter. In order to classify an item on the USML, begin with 
a review of the general characteristics of the item. This should guide 
you to the appropriate category, whereupon you should attempt to match 
the particular characteristics and functions of the article to a 
specific entry within that category.
    (b) Specially designed. (1) If the entry includes the term 
specially designed, refer to Sec.  120.41 to determine if the article 
qualifies for one or more of the exclusions articulated in Sec.  
120.41(b).
    (2) An item described in multiple entries should be categorized 
according to an enumerated entry rather than a specially designed 
catch-all paragraph.
    (c) Integration of controlled items. Defense articles described on 
the USML are controlled and remain subject to this subchapter following 
incorporation or integration into any item not described on the USML, 
unless specifically provided otherwise in this subchapter.
    (d) Other controls. In all cases, articles not controlled on the 
USML may be subject to another U.S. Government regulatory agency (see 
Sec.  120.5, and Supplement No. 4 to part 774 of the Export 
Administration Regulations (EAR) in title 15 of the CFR for guidance on 
classifying an item subject to the EAR).


Sec.  120.12   Commodity jurisdiction determination requests.

    (a) Upon electronic submission of a Commodity Jurisdiction 
Determination Form (Form DS-4076), the Directorate of Defense Trade 
Controls (DDTC) shall provide a determination of whether a particular 
article or service is covered by the U.S. Munitions List in part 121 of 
this subchapter. The determination, consistent with Sec. Sec.  120.2, 
120.3, and 120.4, entails consultation among the Departments of State, 
Defense, Commerce, and other U.S. Government agencies and industry in 
appropriate cases. State, Defense, and Commerce will resolve commodity 
jurisdiction determination disputes in accordance with established 
procedures. State shall notify Defense and Commerce, and other U.S. 
Government agencies as appropriate, of the initiation and conclusion of 
each case.
    (b) A determination that an article or service meets the criteria 
of a defense article or defense service, or provides the equivalent 
performance capabilities of a defense article on the U.S. Munitions 
List, is made on a case-by-case basis, taking into account:
    (1) The form and fit of the article;
    (2) The function and performance capability of the article; and
    (3) Other applicant-provided information, to include a history of 
the product's design, development, and use, as well as specifications 
and any other relevant data as described in brochures and other related 
documents.
    (c) A determination that an article or service has a critical 
military or intelligence advantage such that it warrants control under 
Category XXI of Sec.  121.1 of this subchapter is made, on a case-by-
case basis, taking into account:
    (1) The function and performance capability of the article; and
    (2) The nature of controls imposed by other nations on such items 
(including the Wassenaar Arrangement and other multilateral controls).
    (d) DDTC will provide a preliminary response within 10 working days 
of receipt of a complete request for commodity jurisdiction 
determination. If after 45 days DDTC has not provided a final commodity 
jurisdiction determination, the applicant may request in writing to the 
Director, Office of Defense Trade Controls Policy that this 
determination be given expedited processing.
    (e) A person may appeal a commodity jurisdiction determination by 
submitting a written request for reconsideration to the Deputy 
Assistant Secretary of State for Defense Trade Controls. The Deputy 
Assistant Secretary's determination of the appeal will be provided, in 
writing, within 30 days of receipt of the appeal. If desired, an appeal 
of the Deputy Assistant Secretary's decision can then be made to the 
Assistant Secretary of State for Political-Military Affairs.
    (f) Registration with DDTC as described in part 122 of this 
subchapter is not required prior to submission of a commodity 
jurisdiction determination request.


Sec.  120.13   Registration.

    (a) Any person who engages in the United States in the business of 
manufacturing or exporting or temporarily importing defense articles, 
or furnishing defense services, is required to register with the 
Directorate of Defense Trade Controls as set forth in part 122 of this 
subchapter. For the purpose of this subchapter, engaging in such a 
business requires only one occasion of manufacturing or exporting or 
temporarily importing a defense article or furnishing a defense 
service. A manufacturer who does not engage in exporting must 
nevertheless register.
    (b) Any U.S. person; foreign person located in the United States; 
or foreign person located outside the United States that is owned or 
controlled by a U.S. person, who engages in brokering activities is 
required to register with the Directorate of Defense Trade Controls as 
set forth in part 129 of this subchapter.


Sec.  120.14  Licenses and related authorizations.

    (a) Export, reexport, retransfer, or temporary import, of defense 
articles. The approval of the Directorate of Defense Trade Controls 
(DDTC) must be requested and obtained before the export, reexport, 
retransfer, or temporary import of a defense article, unless an 
exemption under the provisions of this subchapter is applicable.
    (b) Furnishing defense services. The approval of DDTC must be 
requested and obtained before a defense service may be furnished, 
unless an exemption under the provisions of this subchapter is 
applicable.
    (c) Brokering activities. The approval of DDTC must be requested 
and obtained before engaging in the business of brokering activities 
for the defense articles described in Sec.  129.4(a) of this subchapter 
by a person who is required to register as a broker under part 129 of 
this subchapter, unless an exemption under the provisions of part 129 
is applicable.


Sec.  120.15   Exemptions.

    (a) Persons otherwise required to register with the Directorate of 
Defense Trade Controls in accordance with this subchapter must do so 
prior to utilization of an exemption.
    (b) Exemptions provided in this subchapter may not be utilized for 
transactions in which the exporter, any party to the export, any source 
or manufacturer, broker or other participant in the brokering 
activities, is generally ineligible as set forth in Sec.  120.16, 
unless prior written authorization has been granted by the Directorate 
of Defense Trade Controls.
    (c) Exemptions provided in this subchapter do not apply with 
respect to defense articles or defense services originating in or for 
export to any proscribed countries, areas, or persons identified in 
Sec.  126.1 of this subchapter, except as provided in Sec.  126.1.
    (d) Each exemption provided in this subchapter is subject to 
limitation as described in the section or paragraph of this subchapter 
in which the exemption is prescribed.
    (e) Any person engaging in any export, reexport, transfer, or 
retransfer of a defense article or defense service pursuant to an 
exemption must maintain records of each such export, reexport, 
transfer, or retransfer. The records shall, to the extent applicable to 
the transaction and consistent with the

[[Page 16415]]

requirements of Sec.  123.22 of this subchapter, include the following 
information: A description of the defense article, including technical 
data, or defense service; the name and address of the end-user and 
other available contact information (e.g., telephone number and 
electronic mail address); the name of the natural person responsible 
for the transaction; the stated end-use of the defense article or 
defense service; the date of the transaction; the Electronic Export 
Information (EEI) Internal Transaction Number (ITN); and the method of 
transmission. The person using or acting in reliance upon the exemption 
shall also comply with any additional recordkeeping requirements 
enumerated in the text of the regulations concerning such exemption 
(e.g., requirements specific to the Defense Trade Cooperation Treaties 
in Sec. Sec.  126.16 and 126.17 of this subchapter).
    (f) To claim an exemption for the export of technical data under 
the provisions of this subchapter (e.g., Sec. Sec.  125.4 and 125.5 of 
this subchapter), the exporter must certify that the proposed export is 
covered by a relevant section of this subchapter, to include the 
paragraph and applicable subordinate paragraph. Certifications consist 
of clearly marking the package or letter containing the technical data 
``22 CFR [insert ITAR exemption] applicable.'' This certification must 
be made in written form and retained in the exporter's files for a 
period of 5 years. For exports that are oral, visual, or electronic the 
exporter must also complete a written certification and retain it for a 
period of 5 years.


Sec.  120.16  Eligibility for approvals.

    (a) A U.S. person may receive a license or other approval pursuant 
to this subchapter. A foreign person may not receive such a license or 
other approval, except as follows:
    (1) A foreign governmental entity in the U.S. may receive a license 
or other approval;
    (2) A foreign person may receive a reexport or retransfer approval; 
or
    (3) A foreign person may receive an approval for brokering 
activities.
    (b) A request for a license or other approval by a U.S. person or 
by a person referred to in paragraphs (a)(1) and (3) of this section 
will be considered only if the applicant has registered with the 
Directorate of Defense Trade Controls pursuant to part 122 or 129 of 
this subchapter, as appropriate.
    (c) Persons who have been convicted of violating the U.S. criminal 
statutes enumerated in Sec.  120.6, who have been debarred pursuant to 
part 127 or 128 of this subchapter, who are subject to indictment or 
are otherwise charged (e.g., charged by criminal information in lieu of 
indictment) with violating the U.S. criminal statutes enumerated in 
Sec.  120.6, who are ineligible to contract with or to receive a 
license or other form of authorization to import defense articles or 
defense services from any agency of the U.S. Government, who are 
ineligible to receive an export license or other approval from any 
other agency of the U.S. Government, or who are subject to a publicly 
announced Department of State policy of denial, suspension, or 
revocation under Sec.  120.18(a), are generally ineligible to be 
involved in activities regulated under this subchapter.


Sec.  120.17   End-use monitoring.

    (a) Pursuant to section 40A of the Arms Export Control Act (22 
U.S.C. 2785) and related delegations of authority, the Department of 
State is required to establish a monitoring program in order to improve 
accountability with respect to defense articles and defense services, 
sold, leased, or exported under Department of State licenses or other 
approvals under section 38 of the Arms Export Control Act and this 
subchapter.
    (b) All exports of defense articles, technical data, services, and 
brokering activities made pursuant to this subchapter are subject to 
end-use monitoring by the Department of State through the Blue Lantern 
program.


Sec.  120.18  Denial, revocation, suspension, or amendment of licenses 
and other approvals.

    (a) Policy. Licenses or approvals shall be denied or revoked 
whenever required by any statute of the United States. Any application 
for an export license or other approval under this subchapter may be 
disapproved, and any license or other approval or exemption granted 
under this subchapter may be revoked, suspended, or amended without 
prior notice whenever:
    (1) The Department of State deems such action to be in furtherance 
of world peace, the national security or the foreign policy of the 
United States, or is otherwise advisable; or
    (2) The Department of State believes that 22 U.S.C. 2778, any 
regulation contained in this subchapter, or the terms of any U.S. 
Government export authorization (including the terms of a manufacturing 
license or technical assistance agreement, or export authorization 
granted pursuant to the Export Administration Regulations in 15 CFR 
parts 730 through 774) has been violated by any party to the export or 
other person having significant interest in the transaction; or
    (3) An applicant is the subject of a criminal complaint, other 
criminal charge (e.g., an information), or indictment for a violation 
of any of the U.S. criminal statutes enumerated in Sec.  120.6; or
    (4) An applicant or any party to the export or the agreement has 
been convicted of violating any of the U.S. criminal statutes 
enumerated in Sec.  120.6; or
    (5) An applicant is ineligible to contract with, or to receive a 
license or other authorization to import defense articles or defense 
services from, any agency of the U.S. Government; or
    (6) An applicant, any party to the export or agreement, any source 
or manufacturer of the defense article or defense service or any person 
who has a significant interest in the transaction has been debarred, 
suspended, or otherwise is ineligible to receive an export license or 
other authorization from any agency of the U.S. Government (e.g., 
pursuant to an order denying export privileges issued by the Department 
of Commerce under 15 CFR part 766 or by the Department of State under 
part 127 or 128 of this subchapter); or
    (7) An applicant has failed to include any of the information or 
documentation expressly required to support a license application, 
exemption, or other request for approval under this subchapter, or as 
required in the instructions in the applicable Department of State form 
or has failed to provide notice or information as required under this 
subchapter; or
    (8) An applicant is subject to sanctions under other relevant U.S. 
laws (e.g., the Missile Technology Controls title of the National 
Defense Authorization Act for FY 1991 (Pub. L. 101-510); the Chemical 
and Biological Weapons Control and Warfare Elimination Act of 1991 
(Pub. L. 102-182); or the Iran-Iraq Arms Non-Proliferation Act of 1992 
(Pub. L. 102-484)); or
    (9) Any person involved in the transaction has been the subject of 
an unfavorable finding of an end-use monitoring check as described in 
Sec.  120.17.
    (b) Notification. The Directorate of Defense Trade Controls will 
notify applicants or licensees or other appropriate U.S. persons of 
actions taken pursuant to paragraph (a) of this section. The reasons 
for the action will be stated as specifically as security and foreign 
policy considerations permit.
    (c) Reconsideration. If a written request for reconsideration of an 
adverse

[[Page 16416]]

decision is made within 30 days after a person has been informed of the 
decision, the U.S. person will be accorded an opportunity to present 
additional information. The case will then be reviewed by the 
Directorate of Defense Trade Controls.
    (d) Reconsideration of certain applications. Applications for 
licenses or other requests for approval denied for repeated failure to 
provide information or documentation expressly required will normally 
not be reconsidered during the 30 day period following denial. They 
will be reconsidered after this period only after a final decision is 
made on whether the applicant will be subject to an administrative 
penalty imposed pursuant to this subchapter. Any request for 
reconsideration shall be accompanied by a letter explaining the steps 
that have been taken to correct the failure and to ensure compliance 
with the requirements of this subchapter.


Sec.  120.19  Violations and penalties.

    (a) Part 127 of this subchapter specifies conduct that constitutes 
a violation of the Arms Export Control Act (AECA) and/or the 
International Traffic in Arms Regulations in this subchapter and the 
sanctions that may be imposed for such violations.
    (b) The Department strongly encourages the disclosure of 
information to the Directorate of Defense Trade Controls by persons 
that believe they may have violated any export control provision of the 
AECA, or any regulation in this subchapter, order, license, or other 
authorization issued under the authority of the AECA.


Sec.  120.20   Administrative procedures.

    The Arms Export Control Act (AECA) authorizes the President to 
control the import and export of defense articles and services in 
furtherance of world peace and the security and foreign policy of the 
United States. Pursuant to delegated authorities, the Secretary of 
State is authorized to make decisions on whether license applications 
or other written requests for approval shall be granted, or whether 
exemptions may be used. The Secretary of State is also authorized to 
revoke, suspend, or amend licenses or other written approvals whenever 
such action is deemed to be advisable. The administration of the AECA 
is a foreign affairs function encompassed within the meaning of the 
military and foreign affairs exclusion of the Administrative Procedure 
Act and is thereby expressly exempt from various provisions of that 
Act. Because the exercising of the foreign affairs function, including 
the decisions required to implement the AECA, is highly discretionary, 
it is excluded from review under the Administrative Procedure Act.


Sec.  120.21   Disclosure of information.

    (a) Freedom of information. Subchapter R of this title contains 
regulations on the availability to the public of information and 
records of the Department of State. The provisions of subchapter R 
apply to such disclosures by the Directorate of Defense Trade Controls.
    (b) Determinations required by law. Section 38(e) of the Arms 
Export Control Act (AECA) (22 U.S.C. 2778(e)) provides that information 
obtained for the purpose of consideration of, or concerning, license 
applications shall be withheld from public disclosure unless the 
release of such information is determined by the Secretary of State to 
be in the national interest. Section 38(e) of the AECA further provides 
that the names of countries and types and quantities of defense 
articles for which licenses are issued under this section shall not be 
withheld from public disclosure unless certain determinations are made 
that the release of such information would be contrary to the national 
interest. Such determinations required by section 38(e) shall be made 
by the Assistant Secretary of State for Political-Military Affairs.
    (c) Information required under part 130 of this subchapter. Part 
130 contains specific provisions on the disclosure of information 
described in that part.
    (d) National interest determinations. In accordance with section 
38(e) of the AECA, the Secretary of State has determined that the 
following disclosures are in the national interest of the United 
States:
    (1) Furnishing information to foreign governments for law 
enforcement or regulatory purposes; and
    (2) Furnishing information to foreign governments and other 
agencies of the U.S. Government in the context of multilateral or 
bilateral export regimes (e.g., the Missile Technology Control Regime, 
the Australia Group, and Wassenaar Arrangement).


Sec.  120.22   Advisory opinions and related authorizations.

    (a) Preliminary authorization determinations. A person may request 
information from the Directorate of Defense Trade Controls (DDTC) as to 
whether it would likely grant a license or other approval for a 
particular defense article or defense service to a particular country. 
Such information from DDTC is issued on a case-by-case basis and 
applies only to the particular matters presented to DDTC. These 
opinions are not binding on the Department of State and may not be used 
in future matters before the Department. A request for an advisory 
opinion must be made in writing and must outline in detail the 
equipment, its usage, the security classification (if any) of the 
articles or related technical data, and the country or countries 
involved.
    (b) Related authorizations. DDTC may, as appropriate, in accordance 
with the procedures set forth in paragraph (a) of this section, provide 
export authorization, subject to all other relevant requirements of 
this subchapter, both for transactions that have been the subject of 
advisory opinions requested by prospective U.S. exporters, or for the 
Directorate's own initiatives. Such initiatives may cover pilot 
programs, or specifically anticipated circumstances for which the 
Directorate considers special authorizations appropriate.
    (c) Interpretations of the International Traffic in Arms 
Regulations in this subchapter. Any person may request an 
interpretation of the requirements set forth in this subchapter in the 
form of an advisory opinion. A request for an advisory opinion must be 
made in writing. Any response to an advisory opinion provided by DDTC 
pursuant to this paragraph (c) shall not be an authorization to export 
and shall not bind the Department to grant or deny any such 
authorization.


Sec.  120.23   Organizations and arrangements.

    (a) North Atlantic Treaty Organization. North Atlantic Treaty 
Organization (NATO) refers to the organization of member states that 
are parties to the North Atlantic Treaty, which members include: 
Albania, Belgium, Bulgaria, Canada, Croatia, Czech Republic, Denmark, 
Estonia, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, 
Lithuania, Luxembourg, Montenegro, the Netherlands, North Macedonia, 
Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Turkey, 
the United Kingdom, the United States, and any state not included here 
that has deposited an instrument of accession in accordance with 
Article 10 of the North Atlantic Treaty.
    (b) Major non-NATO ally. (1) Major non-NATO ally, as defined in 
section 644(q) of the Foreign Assistance Act of 1961 (22 U.S.C. 
2403(q)), means a country that is designated in accordance with section 
517 of the Foreign Assistance Act of 1961 (22 U.S.C. 2321k) as a major 
non-NATO ally for purposes of the Foreign Assistance Act of 1961 and 
the Arms Export Control

[[Page 16417]]

Act (22 U.S.C. 2151 et seq. and 22 U.S.C. 2751 et seq.).
    (2) The following countries are designated as major non-NATO 
allies: Afghanistan (see Sec.  126.1(g) of this subchapter), Argentina, 
Australia, Bahrain, Brazil, Egypt, Israel, Japan, Jordan, Kuwait, 
Morocco, New Zealand, Pakistan, the Philippines, the Republic of Korea, 
Thailand, and Tunisia. Taiwan shall be treated as though it were 
designated a major non-NATO ally.
    (c) Wassenaar Arrangement. (1) The Wassenaar Arrangement refers to 
the Wassenaar Arrangement on Export Controls for Conventional Arms and 
Dual-Use Goods and Technologies among the United States, Argentina, 
Australia, Austria, Belgium, Bulgaria, Canada, Croatia, the Czech 
Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, 
India Ireland, Italy, Japan, Latvia, Lithuania, Luxembourg, Malta, 
Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, the 
Republic of Korea, Romania, the Russian Federation, Slovakia, Slovenia, 
South Africa, Spain, Sweden, Switzerland, Turkey, Ukraine, and the 
United Kingdom, established on 12 July 1996, to promote transparency 
and greater responsibility in transfers of conventional arms and dual-
use goods and technologies.
    (2) The term Wassenaar Munitions List (WAML) refers to the list of 
military items for which all participants have agreed to maintain 
national export controls.
    (d) Missile Technology Control Regime--(1) Regime. Missile 
Technology Control Regime (MTCR) refers to the policy statement among 
the United States, the United Kingdom, the Federal Republic of Germany, 
France, Italy, Canada, and Japan, announced on April 16, 1987, to 
restrict sensitive missile-relevant transfers based on the MTCR Annex, 
and any amendments thereto.
    (2) MTCR Annex. The term MTCR Annex refers to the MTCR Guidelines 
and the Equipment, Software and Technology Annex of the MTCR, and any 
amendments thereto.
    (3) List of all items on the MTCR Annex. MTCR Annex items specified 
in the U.S. Munitions List shall be annotated by the parenthetical (MT) 
at the end of each applicable paragraph.
    (e) Defense Trade Cooperation Treaty between the United States and 
Australia. Defense Trade Cooperation Treaty between the United States 
and Australia refers to the Treaty between the Government of the United 
States of America and the Government of Australia Concerning Defense 
Trade Cooperation, done at Sydney, September 5, 2007. For additional 
information on making exports pursuant to this treaty, see Sec.  126.16 
of this subchapter.
    (f) Australia Implementing Arrangement. Australia Implementing 
Arrangement refers to the Implementing Arrangement Pursuant to the 
Treaty between the Government of the United States of America and the 
Government of Australia Concerning Defense Trade Cooperation, done at 
Washington, March 14, 2008, as it may be amended.
    (g) Defense Trade Cooperation Treaty between the United States and 
the United Kingdom. Defense Trade Cooperation Treaty between the United 
States and the United Kingdom refers to the Treaty between the 
Government of the United States of America and the Government of the 
United Kingdom of Great Britain and Northern Ireland Concerning Defense 
Trade Cooperation, done at Washington and London, June 21 and 26, 2007. 
For additional information on making exports pursuant to this treaty, 
see Sec.  126.17 of this subchapter.
    (h) United Kingdom Implementing Arrangement. United Kingdom 
Implementing Arrangement refers to the Implementing Arrangement 
Pursuant to the Treaty between the Government of the United States of 
America and the Government of the United Kingdom of Great Britain and 
Northern Ireland Concerning Defense Trade Cooperation, done at 
Washington, February 14, 2008, as it may be amended.


Sec. Sec.  120.24-120.29  [Reserved]

Subpart C--Definitions


Sec.  120.30   Directorate of Defense Trade Controls.

    Directorate of Defense Trade Controls, Bureau of Political-Military 
Affairs, Department of State, Washington, DC 20522-0112.


Sec.  120.31   Defense article.

    (a) Defense article means any item or technical data designated in 
Sec.  121.1 of this subchapter and includes:
    (1) Technical data recorded or stored in any physical form, models, 
mockups or other items that reveal technical data directly relating to 
items designated in Sec.  121.1 of this subchapter; and
    (2) Forgings, castings, and other unfinished products, such as 
extrusions and machined bodies, that have reached a stage in 
manufacturing where they are clearly identifiable by mechanical 
properties, material composition, geometry, or function as defense 
articles.
    (b) It does not include basic marketing information on function or 
purpose or general system descriptions.
    (c) The policy described in Sec.  120.3 is applicable to 
designations of additional items.


Sec.  120.32   Defense service.

    (a) Defense service means:
    (1) The furnishing of assistance (including training) to foreign 
persons, whether in the United States or abroad in the design, 
development, engineering, manufacture, production, assembly, testing, 
repair, maintenance, modification, operation, demilitarization, 
destruction, processing, or use of defense articles;
    (2) The furnishing to foreign persons of any technical data 
controlled under this subchapter, whether in the United States or 
abroad; or
    (3) Military training of foreign units and forces, regular and 
irregular, including formal or informal instruction of foreign persons 
in the United States or abroad or by correspondence courses, technical, 
educational, or information publications and media of all kinds, 
training aid, orientation, training exercise, and military advice.
    (b) [Reserved]


Sec.  120.33   Technical data.

    (a) Technical data means for purposes of this subchapter:
    (1) Information, other than software as defined in Sec.  120.40(g), 
which is required for the design, development, production, manufacture, 
assembly, operation, repair, testing, maintenance, or modification of 
defense articles. This includes information in the form of blueprints, 
drawings, photographs, plans, instructions, or documentation;
    (2) Classified information relating to defense articles and defense 
services on the U.S. Munitions List and 600-series items controlled by 
the Commerce Control List;
    (3) Information covered by an invention secrecy order; or
    (4) Software (see Sec.  120.40(g)) directly related to defense 
articles.
    (b) The definition in paragraph (a) of this section does not 
include information concerning general scientific, mathematical, or 
engineering principles commonly taught in schools, colleges, and 
universities, or information in the public domain as defined in Sec.  
120.34 or telemetry data as defined in note 3 to Category XV(f) of 
Sec.  121.1 of this subchapter. It also does not include basic 
marketing information on function or purpose or general system 
descriptions of defense articles.

[[Page 16418]]

Sec.  120.34   Public domain.

    (a) Public domain means information which is published and which is 
generally accessible or available to the public:
    (1) Through sales at newsstands and bookstores;
    (2) Through subscriptions which are available without restriction 
to any individual who desires to obtain or purchase the published 
information;
    (3) Through second class mailing privileges granted by the U.S. 
Government;
    (4) At libraries open to the public or from which the public can 
obtain documents;
    (5) Through patents available at any patent office;
    (6) Through unlimited distribution at a conference, meeting, 
seminar, trade show, or exhibition, generally accessible to the public, 
in the United States;
    (7) Through public release (i.e., unlimited distribution) in any 
form (e.g., not necessarily in published form) after approval by the 
cognizant U.S. Government department or agency (see also Sec.  
125.4(b)(13) of this subchapter); or
    (8) Through fundamental research in science and engineering at 
accredited institutions of higher learning in the U.S. where the 
resulting information is ordinarily published and shared broadly in the 
scientific community. Fundamental research is defined to mean basic and 
applied research in science and engineering where the resulting 
information is ordinarily published and shared broadly within the 
scientific community, as distinguished from research the results of 
which are restricted for proprietary reasons or specific U.S. 
Government access and dissemination controls. University research will 
not be considered fundamental research if:
    (i) The University or its researchers accept other restrictions on 
publication of scientific and technical information resulting from the 
project or activity; or
    (ii) The research is funded by the U.S. Government and specific 
access and dissemination controls protecting information resulting from 
the research are applicable.
    (b) [Reserved]


Sec.  120.35   [Reserved]


Sec.  120.36   Significant military equipment.

    (a) Significant military equipment means articles for which special 
export controls are warranted because of their capacity for substantial 
military utility or capability.
    (b) Significant military equipment includes:
    (1) Items in Sec.  121.1 of this subchapter that are preceded by an 
asterisk; and
    (2) All classified articles enumerated in Sec.  121.1 of this 
subchapter.


Sec.  120.37  Major defense equipment.

    Major defense equipment, pursuant to section 47(6) of the Arms 
Export Control Act (22 U.S.C. 2794(6)), means any item of significant 
military equipment on the U.S. Munitions List having a nonrecurring 
research and development cost of more than $50,000,000 or a total 
production cost of more than $200,000,000.


Sec.  120.38   Classified.

    Classified means classified pursuant to Executive Order 13526, or 
predecessor order, and a security classification guide developed 
pursuant thereto or equivalent, or to the corresponding classification 
rules of another government or international organization.


Sec.  120.39  Foreign defense article or defense service.

    Foreign defense article or defense service means any article or 
service described on the U.S. Munitions List of non-U.S. origin. Unless 
otherwise provided in this subchapter, the terms defense article and 
defense service refer to both U.S. and foreign origin defense articles 
and defense services described on the U.S. Munitions List. A defense 
article or defense service is determined exclusively in accordance with 
the Arms Export Control Act and this subchapter, regardless of any 
designation (either affirming or contrary) that may be attributed to 
the same article or service by any foreign government or international 
organization.


Sec.  120.40   Compositional terms.

    (a) Commodity means any article, material, or supply, except 
technology/technical data or software.
    (b) An end-item is a system, equipment, or an assembled article 
ready for its intended use. Only ammunition or fuel or other energy 
source is required to place it in an operating state.
    (c) A component is an item that is useful only when used in 
conjunction with an end-item:
    (1) A major component includes any assembled element that forms a 
portion of an end-item without which the end-item is inoperable; and
    (2) A minor component includes any assembled element of a major 
component.
    (d) Accessories and attachments are associated articles for any 
component, equipment, system, or end-item, and which are not necessary 
for its operation, but which enhance its usefulness or effectiveness.
    (e) A part is any single unassembled element of a major or a minor 
component, accessory, or attachment which is not normally subject to 
disassembly without the destruction or the impairment of designed use.
    (f) Firmware and any related unique support tools (such as 
computers, linkers, editors, test case generators, diagnostic checkers, 
library of functions, and system test diagnostics) directly related to 
equipment or systems covered under any category of the U.S. Munitions 
List are considered as part of the end-item or component. Firmware 
includes but is not limited to circuits into which software has been 
programmed.
    (g) Software includes but is not limited to the system functional 
design, logic flow, algorithms, application programs, operating 
systems, and support software for design, implementation, test, 
operation, diagnosis, and repair. A person who intends to export only 
software should, unless it is specifically enumerated in Sec.  121.1 of 
this subchapter (e.g., USML Category XIII(b)), apply for a technical 
data license pursuant to part 125 of this subchapter.
    (h) A system is a combination of parts, components, accessories, 
attachments, firmware, software, equipment, or end-items that operate 
together to perform a function.

    Note 1 to paragraph (h): The industrial standards established by 
the International Council on Systems Engineering (INCOSE), National 
Aeronautics and Space Administration (NASA), and International 
Organization for Standardization (ISO) provide examples for when 
commodities and software operate together to perform a function as a 
system.

    (i) Equipment is a combination of parts, components, accessories, 
attachments, firmware, or software that operate together to perform a 
function of, as, or for an end-item or system. Equipment may be a 
subset of an end-item based on the characteristics of the equipment. 
Equipment that meets the definition of an end-item in paragraph (b) of 
this section is an end-item. Equipment that does not meet the 
definition of an end-item is a component, accessory, attachment, 
firmware, or software.


Sec.  120.41   Specially designed.

    (a) Except for commodities or software described in paragraph (b) 
of this section, a commodity or software is specially designed if it:
    (1) As a result of development, has properties peculiarly 
responsible for

[[Page 16419]]

achieving or exceeding the controlled performance levels, 
characteristics, or functions described in the relevant U.S. Munitions 
List (USML) paragraph in Sec.  121.1 of this subchapter; or

    Note 1 to paragraph (a)(1):  An example of a commodity that as a 
result of development has properties peculiarly responsible for 
achieving or exceeding the controlled performance levels, functions, 
or characteristics in a USML category would be a swimmer delivery 
vehicle specially designed to dock with a submarine to provide 
submerged transport for swimmers or divers from submarines.

    (2) Is a part, component, accessory, attachment, or software for 
use in or with a defense article.
    (b) For purposes of this subchapter, a part, component, accessory, 
attachment, or software is not specially designed if it:
    (1) Is subject to the EAR pursuant to a commodity jurisdiction 
determination;
    (2) Is, regardless of form or fit, a fastener (e.g., screws, bolts, 
nuts, nut plates, studs, inserts, clips, rivets, pins), washer, spacer, 
insulator, grommet, bushing, spring, wire, or solder;
    (3) Has the same function, performance capabilities, and the same 
or equivalent form and fit as a commodity or software used in or with a 
commodity that:
    (i) Is or was in production (i.e., not in development); and
    (ii) Is not enumerated on the USML;
    (4) Was or is being developed with knowledge that it is or would be 
for use in or with both defense articles enumerated on the USML and 
also commodities not on the USML; or
    (5) Was or is being developed as a general purpose commodity or 
software, i.e., with no knowledge for use in or with a particular 
commodity (e.g., a F/A-18 or HMMWV) or type of commodity (e.g., an 
aircraft or machine tool).

    Note 2 to paragraph (b): For a defense article not to be 
specially designed on the basis of paragraph (b)(4) or (5) of this 
section, documents contemporaneous with its development, in their 
totality, must establish the elements of paragraph (b)(4) or (5). 
Such documents may include concept design information, marketing 
plans, declarations in patent applications, or contracts. Absent 
such documents, the commodity may not be excluded from being 
specially designed by either paragraph (b)(4) or (5).


    Note 3 to paragraph (b): For the purpose of paragraphs (b)(4) 
and (5) of this section, ``knowledge'' includes not only the 
positive knowledge a circumstance exists or is substantially certain 
to occur, but also an awareness of a high probability of its 
existence or future occurrence. Such awareness is inferred from 
evidence of the conscious disregard of facts known to a person and 
is also inferred from a person's willful avoidance of facts.

Sec.  120.42   Form, fit, function, performance capability, equivalent, 
enumerated, and catch-all control.

    (a) Form. The form of a commodity is defined by its configuration 
(including the geometrically measured configuration), material, and 
material properties that uniquely characterize it. For software, the 
form means the design, logic flow, and algorithms.
    (b) Fit. The fit of a commodity is defined by its ability to 
physically interface or connect with or become an integral part of 
another commodity. For software, the fit is defined by its ability to 
interface or connect with a defense article.
    (c) Function. The function of a commodity is the action or actions 
it is designed to perform. For software, the function means the action 
or actions the software performs directly related to a defense article 
or as a standalone application.
    (d) Performance capability. 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, performance 
capability means the measure of the software's effectiveness to perform 
a designated function.
    (e) Equivalent. With respect to a commodity, equivalent means its 
form has been modified solely for fit purposes.
    (f) Enumerated. Enumerated refers to any item designated on the 
U.S. Munitions List or item on the Commerce Control List and not in a 
catch-all control.
    (g) Catch-all control. A catch-all control is one that does not 
refer to specific types of parts, components, accessories, or 
attachments, but rather controls unspecified parts, components, 
accessories, or attachments only if they were specially designed for an 
enumerated item.


Sec.  120.43  Development, production, and related terms; Basic and 
applied research.

    (a) Development is related to all stages prior to serial 
production, such as design, design research, design analyses, design 
concepts, assembly and testing of prototypes, pilot production schemes, 
design data, process of transforming design data into a product, 
configuration design, integration design, and layouts. Development 
includes modification of an existing design.
    (b)(1) Production means all production stages, such as product 
engineering, manufacture, integration, assembly (mounting), inspection, 
testing, and quality assurance. This includes serial production where 
commodities have passed production readiness testing (i.e., an 
approved, standardized design ready for large scale production) and 
have been or are being produced on an assembly line for multiple 
commodities using the approved, standardized design.
    (2) Commodities in production that are subsequently subject to 
development activities, such as those that would result in enhancements 
or improvements only in the reliability or maintainability of the 
commodity (e.g., an increased mean time between failure), including 
those pertaining to quality improvements, cost reductions, or feature 
enhancements, remain in production. However, any new models or versions 
of such commodities developed from such efforts that change the basic 
performance or capability of the commodity are in development until and 
unless they enter into production.
    (c) Design methodology includes the underlying engineering methods 
and design philosophy utilized (i.e., information that explains the 
rationale for a particular design decision, engineering feature, or 
performance requirement); engineering experience (e.g., lessons 
learned); and the rationale and associated databases (e.g., design 
allowables, factors of safety, component life predictions, failure 
analysis criteria) that establish the operational requirements (e.g., 
performance, mechanical, electrical, electronic, reliability and 
maintainability) of a defense article. (Final analytical results and 
the initial conditions and parameters may be provided.)
    (d) Engineering analysis includes the analytical methods and tools 
used to design or evaluate a defense article's performance against the 
operational requirements. Analytical methods and tools include the 
development and/or use of mockups, computer models and simulations, and 
test facilities. (Final analytical results and the initial conditions 
and parameters may be provided.)
    (e) Manufacturing know-how includes information that provides 
detailed manufacturing processes and techniques needed to translate a 
detailed design into a qualified, finished defense article. 
(Information may be provided in a build-to-print package that is 
necessary in order to produce an acceptable defense article.)
    (f) Build-to-print means that a foreign consignee can produce a 
defense article from engineering drawings without any technical 
assistance from a U.S.

[[Page 16420]]

exporter. This transaction is based strictly on a hands-off approach 
since the foreign consignee is understood to have the inherent 
capability to produce the defense article and only lacks the necessary 
drawings. Supporting documentation (e.g., acceptance criteria, object 
code software for numerically controlled machines) may be released on 
an as-required basis (i.e., must have) such that the foreign consignee 
would not be able to produce an acceptable defense article without this 
additional supporting documentation. Build-to-print does not include 
the release of any information which discloses design methodology, 
engineering analysis, detailed process information or manufacturing 
know-how. Documentation which is not absolutely necessary to permit 
manufacture of an acceptable defense article (i.e. nice to have) is not 
considered within the boundaries of a build-to-print data package.
    (g) Build/design-to-specification means that a foreign consignee 
can design and produce a defense article from requirement 
specifications without any technical assistance from the U.S. exporter. 
This transaction is based strictly on a hands-off approach since the 
foreign consignee is understood to have the inherent capability to both 
design and produce the defense article and only lacks the necessary 
requirement information.
    (h) Basic research means a systemic study directed toward greater 
knowledge or understanding of the fundamental aspects of phenomena and 
observable facts without specific applications towards processes or 
products in mind. It does not include applied research.
    (i) Applied research means a systemic study to gain knowledge or 
understanding necessary to determine the means by which a recognized 
and specific need may be met. It is a systematic application of 
knowledge toward the production of useful materials, devices, and 
systems or methods, including design, development, and improvement of 
prototypes and new processes to meet specific requirements.


Sec.  120.44   [Reserved]


Sec.  120.45  Maintenance levels.

    (a) Organizational-level maintenance (or basic-level maintenance) 
is the first level of maintenance that can be performed on-equipment 
(directly on the defense article or support equipment) without 
specialized training. It consists of repairing, inspecting, servicing, 
calibrating, lubricating, or adjusting equipment, as well as replacing 
minor parts, components, assemblies, and line-replaceable spares or 
units. This includes modifications, enhancements, or upgrades that 
would result in improving only the reliability or maintainability of 
the commodity (e.g., an increased mean time between failure) and does 
not enhance the basic performance or capability of the defense article.
    (b) Intermediate-level maintenance is second-level maintenance 
performed off-equipment (on removed parts, components, or equipment) at 
or by designated maintenance shops or centers, tenders, or field teams. 
It may consist of calibrating, repairing, testing, or replacing damaged 
or unserviceable parts, components, or assemblies. This includes 
modifications, enhancements, or upgrades that would result in improving 
only the reliability or maintainability of the commodity (e.g., an 
increased mean time between failure) and does not enhance the basic 
performance or capability of the defense article.
    (c) Depot-level maintenance is third-level maintenance performed 
on- or off-equipment at or by a major repair facility, shipyard, or 
field team, each with necessary equipment and personnel of requisite 
technical skill. It consists of providing evaluation or repair beyond 
unit or organization capability. This maintenance consists of 
inspecting, testing, calibrating, repairing, overhauling, refurbishing, 
reconditioning, and one-to-one replacing of any defective parts, 
components, or assemblies. This includes modifications, enhancements, 
or upgrades that would result in improving only the reliability or 
maintainability of the commodity (e.g., an increased mean time between 
failure) and does not enhance the basic performance or capability of 
the defense article.


Sec. Sec.  120.46-120.49   [Reserved]


Sec.  120.50  Export.

    (a) Export, except as set forth in Sec.  120.54 or Sec.  126.16 or 
Sec.  126.17 of this subchapter, means:
    (1) An actual shipment or transmission out of the United States, 
including the sending or taking of a defense article out of the United 
States in any manner;
    (2) Releasing or otherwise transferring technical data to a foreign 
person in the United States (a deemed export);
    (3) Transferring registration, control, or ownership of any 
aircraft, vessel, or satellite subject to this subchapter by a U.S. 
person to a foreign person;
    (4) Releasing or otherwise transferring a defense article to an 
embassy or to any of its agencies or subdivisions, such as a diplomatic 
mission or consulate, in the United States;
    (5) Performing a defense service on behalf of, or for the benefit 
of, a foreign person, whether in the United States or abroad; or
    (6) The release of previously encrypted technical data as described 
in Sec.  120.56(a)(3) and (4).
    (b) Any release in the United States of technical data to a foreign 
person is deemed to be an export to all countries in which the foreign 
person has held or holds citizenship or holds permanent residency.


Sec.  120.51   Reexport.

    (a) Reexport, except as set forth in Sec.  120.54 or Sec.  126.16 
or Sec.  126.17 of this subchapter, means:
    (1) An actual shipment or transmission of a defense article from 
one foreign country to another foreign country, including the sending 
or taking of a defense article to or from such countries in any manner;
    (2) Releasing or otherwise transferring technical data to a foreign 
person who is a citizen or permanent resident of a country other than 
the foreign country where the release or transfer takes place (a deemed 
reexport); or
    (3) Transferring registration, control, or ownership of any 
aircraft, vessel, or satellite subject to this subchapter between 
foreign persons.
    (b) Any release outside the United States of technical data to a 
foreign person is deemed to be a reexport to all countries in which the 
foreign person has held or holds citizenship or holds permanent 
residency.


Sec.  120.52   Retransfer.

    (a) Retransfer, except as set forth in Sec.  120.54 or Sec.  126.16 
or Sec.  126.17 of this subchapter, means:
    (1) A change in end-use or end-user, or a temporary transfer to a 
third party, of a defense article within the same foreign country; or
    (2) A release of technical data to a foreign person who is a 
citizen or permanent resident of the country where the release or 
transfer takes place.
    (b) [Reserved]


Sec.  120.53   Temporary import.

    (a) Temporary import, except as set forth in Sec.  120.54, means 
bringing into the United States from a foreign country any defense 
article that is:
    (1) To be returned to the country from which it was shipped or 
taken; or

[[Page 16421]]

    (2) Any defense article that is in transit to another foreign 
destination.
    (b) Temporary import includes withdrawal of a defense article from 
a customs bonded warehouse or foreign trade zone for the purpose of 
returning it to the country of origin or country from which it was 
shipped or for shipment to another foreign destination.
    (c) Permanent imports are regulated by the Attorney General under 
the direction of the Department of Justice's Bureau of Alcohol, 
Tobacco, Firearms, and Explosives (see 27 CFR parts 447, 478, 479, and 
555).


Sec.  120.54   Activities that are not exports, reexports, retransfers, 
or temporary imports.

    (a) The following activities are not exports, reexports, 
retransfers, or temporary imports:
    (1) Launching a spacecraft, launch vehicle, payload, or other item 
into space;
    (2) Transmitting or otherwise transferring technical data to a U.S. 
person in the United States from a person in the United States;
    (3) Transmitting or otherwise transferring within the same foreign 
country technical data between or among only U.S. persons, so long as 
the transmission or transfer does not result in a release to a foreign 
person or transfer to a person prohibited from receiving the technical 
data;
    (4) Shipping, moving, or transferring defense articles between or 
among the United States as defined in Sec.  120.60;
    (5) Sending, taking, or storing technical data that is:
    (i) Unclassified;
    (ii) Secured using end-to-end encryption;
    (iii) Secured using cryptographic modules (hardware or software) 
compliant with the Federal Information Processing Standards Publication 
140-2 (FIPS 140-2) or its successors, supplemented by software 
implementation, cryptographic key management and other procedures and 
controls that are in accordance with guidance provided in current U.S. 
National Institute for Standards and Technology (NIST) publications, or 
by other cryptographic means that provide security strength that is at 
least comparable to the minimum 128 bits of security strength achieved 
by the Advanced Encryption Standard (AES-128); and
    (iv) Not intentionally sent to a person in or stored in a country 
proscribed in Sec.  126.1 of this subchapter or the Russian Federation; 
and

    Note 1 to paragraph (a)(5)(iv): Data in-transit via the internet 
is not deemed to be stored.

    (v) Not sent from a country proscribed in Sec.  126.1 of this 
subchapter or the Russian Federation.
    (b)(1) For purposes of this section, end-to-end encryption is 
defined as:
    (i) The provision of cryptographic protection of data, such that 
the data is not in an unencrypted form, between an originator (or the 
originator's in-country security boundary) and an intended recipient 
(or the recipient's in-country security boundary); and
    (ii) The means of decryption are not provided to any third party.
    (2) The originator and the intended recipient may be the same 
person. The intended recipient must be the originator, a U.S. person in 
the United States, or a person otherwise authorized to receive the 
technical data, such as by a license or other approval pursuant to this 
subchapter.
    (c) The ability to access technical data in encrypted form that 
satisfies the criteria set forth in paragraph (a)(5) of this section 
does not constitute the release or export of such technical data.


Sec.  120.55   Access information.

    Access information is information that allows access to encrypted 
technical data subject to this subchapter in an unencrypted form. 
Examples include decryption keys, network access codes, and passwords.


Sec.  120.56   Release.

    (a) Release. Technical data is released through:
    (1) Visual or other inspection by foreign persons of a defense 
article that reveals technical data to a foreign person;
    (2) Oral or written exchanges with foreign persons of technical 
data in the United States or abroad;
    (3) The use of access information to cause or enable a foreign 
person, including yourself, to access, view, or possess unencrypted 
technical data; or
    (4) The use of access information to cause technical data outside 
of the United States to be in unencrypted form.
    (b) Provision of access information. Authorization for a release of 
technical data to a foreign person is required to provide access 
information to that foreign person, if that access information can 
cause or enable access, viewing, or possession of the unencrypted 
technical data.


Sec.  120.57   Authorization types.

    (a) License means a document bearing the word ``license'' issued by 
the Deputy Assistant Secretary of State for Defense Trade Controls, or 
authorized designee, that permits the export, reexport, retransfer, 
temporary import, or brokering of a specific defense article or defense 
service controlled by this subchapter.
    (b) Other approval means a document, other than a license, issued 
by the Deputy Assistant Secretary of State for Defense Trade Controls, 
or authorized designee, that approves an activity regulated by this 
subchapter (e.g., approvals for brokering activities or retransfer 
authorizations), or the use of an exemption to the license requirements 
as described in this subchapter.
    (c) Exemption means a provision of this subchapter that authorizes 
the export, reexport, retransfer, temporary import, or brokering of a 
specific defense article or defense service without a license or other 
written authorization.
    (d) Manufacturing license agreement means an agreement (e.g., 
contract), approved by the Directorate of Defense Trade Controls 
(DDTC), whereby a U.S. person grants a foreign person an authorization 
to manufacture defense articles abroad and which involves or 
contemplates:
    (1) The export of technical data or defense articles or the 
performance of a defense service; or
    (2) The use by the foreign person of technical data or defense 
articles previously exported by the U.S. person.
    (e) Technical assistance agreement means an agreement (e.g., 
contract), approved by DDTC, for the performance of a defense 
service(s) or the disclosure of technical data, as opposed to an 
agreement granting a right or license to manufacture defense articles. 
Assembly of defense articles is included under this section, provided 
production rights or manufacturing know-how are not conveyed. Should 
such rights be transferred, paragraph (d) of this section is 
applicable.
    (f) Distribution agreement means an agreement (e.g., a contract), 
approved by DDTC, to establish a warehouse or distribution point abroad 
for defense articles exported from the United States for subsequent 
distribution to entities in an approved sales territory.


Sec.  120.58   Subject to the Export Administration Regulations (EAR).

    Items subject to the EAR are those items listed on the Commerce 
Control List in part 774 of the Export Administration Regulations (EAR) 
and all other items that meet the definition of that term in accordance 
with Sec.  734.3 of the EAR. The EAR is found at 15 CFR parts 730 
through 774.

[[Page 16422]]

Sec.  120.59   [Reserved]


Sec.  120.60  United States.

    United States, when used in the geographical sense, includes the 
several states, the Commonwealth of Puerto Rico, the insular 
possessions of the United States, the District of Columbia, the 
Commonwealth of the Northern Mariana Islands, any territory or 
possession of the United States, and any territory or possession over 
which the United States exercises any powers of administration, 
legislation, and jurisdiction.


Sec.  120.61   Person.

    Person means a natural person as well as a corporation, business 
association, partnership, society, trust, or any other entity, 
organization or group, including governmental entities. If a provision 
in this subchapter does not refer exclusively to a foreign person or 
U.S. person, then it refers to both.


Sec.  120.62   U.S. person.

    U.S. person means a person who is a lawful permanent resident as 
defined by 8 U.S.C. 1101(a)(20) or who is a protected individual as 
defined by 8 U.S.C. 1324b(a)(3). It also means any corporation, 
business association, partnership, society, trust, or any other entity, 
organization, or group that is incorporated to do business in the 
United States. It also includes any governmental (Federal, state, or 
local) entity. It does not include any foreign person as defined in 
Sec.  120.63.


Sec.  120.63   Foreign person.

    Foreign person means any natural person who is not a lawful 
permanent resident as defined by 8 U.S.C. 1101(a)(20) or who is not a 
protected individual as defined by 8 U.S.C. 1324b(a)(3). It also means 
any foreign corporation, business association, partnership, trust, 
society, or any other entity or group that is not incorporated or 
organized to do business in the United States, as well as international 
organizations, foreign governments, and any agency or subdivision of 
foreign governments (e.g., diplomatic missions).


Sec.  120.64  Regular employee.

    (a) Regular employee means:
    (1) An individual permanently and directly employed by the company; 
or
    (2) An individual in a long term contractual relationship with the 
company where the individual works at the company's facilities, works 
under the company's direction and control, works full time and 
exclusively for the company, and executes nondisclosure certifications 
for the company, and where the staffing agency that has seconded the 
individual has no role in the work the individual performs (other than 
providing that individual for that work) and the staffing agency would 
not have access to any controlled technology (other than where 
specifically authorized by a license).
    (b) [Reserved]


Sec.  120.65   Foreign ownership and foreign control.

    (a) Foreign ownership means more than 50 percent of the outstanding 
voting securities of the firm are owned by one or more foreign persons.
    (b) Foreign control means one or more foreign persons have the 
authority or ability to establish or direct the general policies or 
day-to-day operations of the firm. Foreign control is presumed to exist 
where foreign persons own 25 percent or more of the outstanding voting 
securities unless one U.S. person controls an equal or larger 
percentage.


Sec.  120.66   Affiliate.

    (a) Affiliate (of a registrant) means a person that directly, or 
indirectly through one or more intermediaries, controls, or is 
controlled by, or is under common control with, such registrant.
    (b) For purposes of this section, ``control'' means having the 
authority or ability to establish or direct the general policies or 
day-to-day operations of the firm. Control is rebuttably presumed to 
exist where there is ownership of 25 percent or more of the outstanding 
voting securities if no other person controls an equal or larger 
percentage.


Sec.  120.67   Empowered official.

    (a) Empowered official means a U.S. person who:
    (1) Is directly employed by the applicant or a subsidiary in a 
position having authority for policy or management within the applicant 
organization; and
    (2) Is legally empowered in writing by the applicant to sign 
license applications or other requests for approval on behalf of the 
applicant; and
    (3) Understands the provisions and requirements of the various 
export control statutes and regulations, and the criminal liability, 
civil liability, and administrative penalties for violating the Arms 
Export Control Act and the International Traffic in Arms Regulations in 
this subchapter; and
    (4) Has the independent authority to:
    (i) Inquire into any aspect of a proposed export, temporary import, 
or brokering activity by the applicant;
    (ii) Verify the legality of the transaction and the accuracy of the 
information to be submitted; and
    (iii) Refuse to sign any license application or other request for 
approval without prejudice or other adverse recourse.
    (b) For the purposes of a broker who is a foreign person, the 
empowered official may be a foreign person who otherwise meets the 
criteria for an empowered official in paragraph (a) of this section.


Sec.  120.68   Party to the export.

    (a) Party to the export means:
    (1) The chief executive officer, president, vice-presidents, other 
senior officers and officials (e.g., comptroller, treasurer, general 
counsel), and any member of the board of directors of the applicant;
    (2) The freight forwarders or designated exporting agent of the 
applicant; and
    (3) Any consignee or end-user of any item to be exported.
    (b) [Reserved]


Sec.  120.69   Port Directors.

    Port Directors means the U.S. Customs and Border Protection Port 
Directors at the U.S. Customs and Border Protection Ports of Entry 
(other than the port of New York, New York where their title is the 
Area Directors).

PART 121--THE UNITED STATES MUNITIONS LIST

0
2. The authority citation for part 121 is revised to read as follows:

    Authority:  22 U.S.C. 2752, 2778, 2797; 22 U.S.C. 2651a; Sec. 
1514, Pub. L. 105-261, 112 Stat. 2175; E.O. 13637, 78 FR 16129, 3 
CFR, 2013 Comp., p. 223.


0
3. Add Sec.  121.0 to read as follows:


Sec.  121.0   United States Munitions List description and definitions.

    (a) For a description of the U.S. Munitions List and its 
designations, including the use of asterisks and the parenthetical 
``(MT)'', see Sec.  120.10 of this subchapter.
    (b) As used in this part, EAR means Export Administration 
Regulations in 15 CFR parts 730 through 774.


Sec.  121.1   [Amended]

0
4. Section 121.1 is amended as follows:
0
a. Remove and reserve paragraphs (a) and (b); and
0
b. In the United States Munitions List:
0
i. Remove ``i.e.,'', ``See'', and ``see'' everywhere they appear and 
add in their places ``i.e.,'', ``See'', and ``see'' respectively;
0
ii. Remove the phrases ``(see Sec.  120.4 of this subchapter)'' and 
``(see Sec.  120.42 of this subchapter)'' everywhere they appear;
0
iii. Remove the phrase ``(see Sec.  120.10 of this subchapter) and 
defense services

[[Page 16423]]

(see Sec.  120.9 of this subchapter)'' everywhere it appears and add in 
its place ``(see Sec.  120.33 of this subchapter) and defense services 
(see Sec.  120.32 of this subchapter)'';
0
iv. In Category II, remove Note 1 to paragraph (j)(17);
0
v. In Category III, remove Note 1 to paragraph (d)(15);
0
vi. In Category IV, remove the note to paragraph (h)(30);
0
vii. In Category V:
0
A. In paragraph (h)(2), remove the phrase ``(see Sec.  120.10(a)(2) of 
this subchapter)'';
0
B. Remove Note to paragraph (h); and
0
C. In paragraph (j):
0
1. Remove the phrase ``(as defined in Sec.  120.10 of this subchapter) 
and defense services (as defined in Sec.  120.9 of this subchapter)'' 
and add in its place ``(see Sec.  120.33 of this subchapter) and 
defense services (see Sec.  120.32 of this subchapter)'';
0
2. Remove ``(see also Sec.  123.20 of this subchapter)'' and add in its 
place ``(see also Sec.  120.5(c) of this subchapter for nuclear related 
controls)'';
0
viii. In Category VI:
0
A. Remove the phrase ``see Sec.  120.45(g)'' and add in its place ``see 
Sec.  120.40(h)'' in Note to paragraph (b)(4);
0
B. Remove ``(see Sec.  123.20 of this subchapter)'' and add in its 
place ``(see also Sec.  120.5(c) of this subchapter for nuclear related 
controls)'' in paragraphs (e) and (f)(5); and
0
C. Remove the second sentence of paragraph of (f)(9)(iii);
0
ix. In Category VII:
0
A. Remove the phrase ``see Sec.  120.45(g)'' and add in its place ``see 
Sec.  120.40(h)'' in Note to paragraph (c); and
0
B. Remove the undesignated sentence following paragraph (g)(14)(iii);
0
x. In Category VIII, remove Note to paragraph (h)(20);
0
xi. In Category IX:
0
A. Remove Note to paragraph (a)(11) and Note to paragraph (b)(5); and
0
B. Remove the phrase ``see, Sec.  120.9(a)(3)'' and add in its place 
``see Sec.  120.32(a)(3)'' in paragraph (e)(3);
0
xii. In Category X, remove Note to paragraph (d)(4);
0
xiii. In Category XI:
0
A. Remove the phrase ``(see Sec.  120.10(a)(2) of this subchapter)'' in 
paragraph (c)(19)(iii);
0
B. Remove Note to paragraph (c)(19); and
0
C. Remove the phrase ``see Sec.  121.8(f)'' and add in its place ``see 
Sec.  120.40(g)'' in Note to paragraph (c)(19)(ii);
0
xiv. In Category XII:
0
A. Remove Note to paragraph (e)(23);
0
B. Remove the phrase ``(see Sec.  120.10) and defense services (see 
Sec.  120.9)'' and add in its place ``(see Sec.  120.33 of this 
subchapter) and defense services (see Sec.  120.32 of this 
subchapter)'' in paragraph (f); and
0
C. Remove the reference ``Sec.  120.4'' and add in its place 
``Sec. Sec.  120.4 and 120.12'' in Note to Category XII;
0
xv. In Category XIII:
0
A. Remove the undesignated sentence following paragraph (f)(iii);
0
B. Remove the phrase ``see Sec.  125.4(c)(4)'' and add in its place 
``see Sec.  120.43(c)'' in paragraph (i)(6); and
0
C. In paragraph (l):
0
1. Remove the phrase ``(see Sec.  120.10 of this subchapter) directly 
related to the defense articles described in paragraphs (a) through 
(h), (j), and (k) of this category and defense services (see Sec.  
120.9 of this subchapter)'' and add in its place ``(see Sec.  120.33 of 
this subchapter) directly related to the defense articles described in 
paragraphs (a) through (h), (j), and (k) of this category and defense 
services (see Sec.  120.32) of this subchapter)''; and
0
2. Add at the end of the first sentence ``(see also Sec.  120.5(c) of 
this subchapter for nuclear related controls)''; and
0
3. Remove the first parenthetical sentence;
0
xvi. In Category XIV:
0
A. Remove Note to paragraph (f)(8); and
0
B. Remove the phrase ``(as defined in Sec.  120.10 of this subchapter) 
and defense services (as defined in Sec.  120.9 of this subchapter)'' 
and add in its place ``(see Sec.  120.33 of this subchapter) and 
defense services (see Sec.  120.32 of this subchapter)'' in paragraph 
(m);
0
xvii. In Category XV:
0
A. Remove the phrase ``(see Sec.  120.7 of this subchapter)'' in Note 3 
to paragraph (a)(7); and
0
B. Remove the second sentence of paragraph (a)(13) and Note to 
paragraph (e)(21);
0
xvii. In Category XVI(e):
0
A. Add ``(see also Sec.  120.5(c) of this subchapter for nuclear 
related controls)'' at the end of the first sentence; and
0
B. Remove the parenthetical sentence at the end of the paragraph;
0
xviii. In Category XVIII(g), remove the phrase ``(see Sec.  120.10 of 
this subchapter) and defense services (as defined in Sec.  120.9 of 
this subchapter)'' and add in its place ``(see Sec.  120.33 of this 
subchapter) and defense services (see Sec.  120.32 of this 
subchapter)'';
0
xix. In Category XIX, remove Note to paragraph (f)(6);
0
xx. In Category XX:
0
A. Remove the phrase ``see Sec.  120.45(g)'' and add in its place ``see 
Sec.  120.40(h)'' in Note to paragraph (a)(7); and
0
B. Remove ``(see Sec.  123.20 of this subchapter)'' and add in its 
place ``(see also Sec.  120.5(c) of this subchapter for nuclear related 
controls)'' in paragraph (b)(1); and
0
xxi. In Category XXI(a), remove the phrase ``(see Sec.  120.7 of this 
subchapter)''.


Sec.  121.16  [Removed and Reserved]

0
5. Remove and reserve Sec.  121.16.

PART 122--REGISTRATION OF MANUFACTURERS AND EXPORTERS

0
6. The authority citation for part 122 continues to read as follows:

    Authority: Sections 2 and 38, Pub. L. 90-629, 90 Stat. 744 (22 
U.S.C. 2752, 2778); 22 U.S.C. 2651a; E.O. 13637, 78 FR 16129.


Sec.  122.2   [Amended]

0
7. In Sec.  122.2:
0
a. In paragraph (a), remove the reference ``Sec.  120.40'' and add in 
its place ``Sec.  120.66'';
0
b. In paragraph (b)(1)(i), remove the reference ``Sec.  120.27'' and 
add in its place ``Sec.  120.6''; and
0
c. In paragraph (b)(2), remove the reference ``Sec.  120.37'' and add 
in its place ``Sec.  120.65''.


Sec.  122.4   [Amended]

0
8. In Sec.  122.4:
0
a. In paragraph (a)(1), remove the reference ``Sec.  120.27'' and add 
in its place ``Sec.  120.6''; and
0
b. In paragraph (b), remove the reference ``Sec. Sec.  120.10 and 
126.1(e)'' and add in its place ``Sec.  126.1(e)''.

PART 123--LICENSES FOR THE EXPORT AND TEMPORARY IMPORT OF DEFENSE 
ARTICLES

0
9. The authority citation for part 123 continues to read as follows:

    Authority: Secs. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 (22 
U.S.C. 2752, 2778, 2797); 22 U.S.C. 2753; 22 U.S.C. 2651a; 22 U.S.C. 
2776; Pub. L. 105-261, 112 Stat. 1920; Sec. 1205(a), Pub. L. 107-
228; Sec. 520, Pub. L. 112-55; Section 1261, Pub. L. 112-239; E.O. 
13637, 78 FR 16129.


Sec.  123.1   [Amended]

0
10. In Sec.  123.1:
0
a. In paragraph (b) introductory text, remove the phrase ``(see Sec.  
120.42 of this subchapter)''; and
0
b. In paragraph (d), remove the reference ``Sec.  120.9(a)'' and add in 
its place ``Sec.  120.32''.


Sec.  123.4   [Amended]

0
11. In Sec.  123.4, in paragraph (c)(1), remove the reference ``Sec.  
120.1(c)'' and add in its place ``Sec.  120.16''.


Sec.  123.9  [Amended]

0
12. In Sec.  123.9, in paragraph (b)(2), remove the phrase ``(see 
Sec. Sec.  120.5,

[[Page 16424]]

120.42 and 123.1(b) of this subchapter)''.


Sec.  123.15   [Amended]

0
13. In Sec.  123.15, in paragraph (a) introductory text, remove the 
reference ``Sec.  120.8'' and add in its place ``Sec.  120.37''.


Sec.  123.16  [Amended]

0
14. In Sec.  123.16:
0
a. In paragraph (a), remove the reference ``Sec.  120.1(c)'' and add in 
its place ``Sec.  120.16'';
0
b. In paragraph (b)(4), remove the reference ``Sec.  120.45(b)'' and 
add in its place ``Sec.  120.40(c)''; and
0
c. In paragraph (b)(9) introductory text, remove the reference ``Sec.  
120.37'' and add in its place ``Sec.  120.65''.


Sec.  123.17  [Amended]

0
15. In Sec.  123.17, in paragraph (k), remove the reference 
``Sec. Sec.  120.1(c) and (d)'' and add in its place ``Sec. Sec.  
120.15(d) and 120.16(c)''.


Sec. Sec.  123.20 and 123.26   [Removed and Reserved]

0
16. Remove and reserve Sec. Sec.  123.20 and 123.26.


Sec.  123.27  [Amended]

0
17. In Sec.  123.27, in paragraph (a)(1), remove the references ``(see 
Sec.  120.31 of this subchapter)'' and ``(see Sec.  120.32 of this 
subchapter)''.

PART 124--AGREEMENTS, OFF-SHORE PROCUREMENT, AND OTHER DEFENSE 
SERVICES

0
18. The authority citation for part 124 continues to read as follows:

    Authority:  Secs. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 
(22 U.S.C. 2752, 2778, 2797); 22 U.S.C. 2651a; 22 U.S.C. 2776; 
Section 1514, Pub. L. 105-261; Pub. L. 111-266; Section 1261, Pub. 
L. 112-239; E.O. 13637, 78 FR 16129.


Sec.  124.1  [Amended]

0
19. In Sec.  124.1, in paragraph (a), remove the reference ``Sec.  
120.9(a)'' everywhere it appears and add in its place ``Sec.  120.32''.

0
20. In Sec.  124.2:
0
a. In paragraph (b), remove the reference ``Sec.  120.9'' and add in 
its place ``Sec.  120.32''; and
0
b. Revise paragraph (c)(4).
    The revision reads as follows:


Sec.  124.2  Exemptions for training and military service.

* * * * *
    (c) * * *
    (4) Supporting technical data must be unclassified and must not 
include software documentation on the design or details of the computer 
software, software source code, design methodology, engineering 
analysis, or manufacturing know-how.
* * * * *


Sec.  124.11  [Amended]

0
21. In Sec.  124.11, in paragraph (a), remove the phrases ``as defined 
in Sections 120.21 and 120.22 respectively'', ``(see Sec.  120.7 of 
this subchapter)'' and ``, as defined in Sec.  120.8 of this 
subchapter''.

0
22. In Sec.  124.13, revise the section heading and paragraph (b) to 
read as follows:


Sec.  124.13  Procurement by U.S. persons in foreign countries 
(offshore procurement).

* * * * *
    (b) The technical data of U.S.-origin to be used in the foreign 
manufacture of defense articles does not exceed that required for bid 
purposes on a build-to-print basis; and
* * * * *

PART 125--LICENSES FOR THE EXPORT OF TECHNICAL DATA AND CLASSIFIED 
DEFENSE ARTICLES

0
23. The authority citation for part 125 continues to read as follows:

    Authority:  Secs. 2 and 38, Pub. L. 90-629, 90 Stat. 744 (22 
U.S.C. 2752, 2778); 22 U.S.C. 2651a; E.O. 13637, 78 FR 16129.


Sec.  125.1  [Amended]

0
24. In Sec.  125.1:
0
a. In paragraph (a), remove the phrase ``see Sec.  120.11'' and add in 
its place ``see Sec.  120.34''; and
0
b. In paragraph (e), remove the phrase ``please see Sec.  123.20'' and 
add in its place ``see Sec.  120.5(c)''.

0
25. In Sec.  125.4:
0
a. In paragraph (a), remove the reference ``Sec.  120.1(c)'' and add in 
its place ``Sec.  120.16'';
0
b. Revise paragraph (c); and
0
c. Remove paragraph (d).
    The revision reads as follows:


Sec.  125.4  Exemptions of general applicability.

* * * * *
    (c) Defense services and related unclassified technical data are 
exempt from the licensing requirements of this subchapter, to nationals 
of NATO countries, Australia, Japan, and Sweden, for the purposes of 
responding to a written request from the Department of Defense for a 
quote or bid proposal. Such exports must be pursuant to an official 
written request or directive from an authorized official of the U.S. 
Department of Defense. The defense services and technical data are 
limited to paragraphs (f), (g), and (h) (build-to-print, build/design-
to-specification, and basic research, respectively) of Sec.  120.43 of 
this subchapter and must not include paragraph (c), (d), (e), or (i) 
(design methodology, engineering analysis, manufacturing know-how, and 
applied research, respectively) of Sec.  120.43.


Sec.  125.6  [Removed and Reserved]

0
26. Remove and reserve Sec.  125.6.

PART 126--GENERAL POLICIES AND PROVISIONS

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

    Authority:  22 U.S.C. 2752, 2778, 2780, 2791, and 2797; 22 
U.S.C. 2651a; 22 U.S.C. 287c; 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.


Sec.  126.1  [Amended]

0
28. In Sec.  126.1, in paragraph (c)(1), remove the reference ``Sec.  
120.15'' and add in its place ``Sec.  120.62''.


Sec.  126.5  [Amended]

0
29. In Sec.  126.5:
0
a. In paragraph (a), remove the phrase ``(see Sec.  120.6 of this 
subchapter)''; and
0
b. In paragraph (b):
0
i. Remove the reference ``22 CFR 120.1(c) and (d)'' and add in its 
place ``Sec. Sec.  120.15(d) and 120.16''; and
0
ii. Remove the reference ``Sec.  126.1 of this subchapter'' and add in 
its place ``Sec.  126.1''.


Sec. Sec.  126.7, 126.9, 126.10, 126.11, and 126.12  [Removed and 
Reserved]

0
30. Remove and reserve Sec. Sec.  126.7, 126.9, 126.10, 126.11, and 
126.12.


Sec.  126.13  [Amended]

0
31. In Sec.  126.13:
0
a. In paragraph (a)(1), remove the reference ``Sec.  120.27'' and add 
in its place ``Sec.  120.6''; and
0
b. In paragraph (a)(3), remove the references ``Sec.  126.7(e)'' and 
``Sec.  120.27'' add in their places ``Sec.  120.68(a) of this 
subchapter'' and ``Sec.  120.6,'' respectively;


Sec.  126.16  [Amended]

0
32. In Sec.  126.16:
0
a. In paragraph (g)(1), remove the reference ``Sec.  120.17'' and add 
in its place ``Sec.  120.50''; and
0
b. In paragraph (o)(1)(iii), remove the phrase ``see Sec.  120.7'' and 
add in its place ``see Sec.  120.36''.


Sec.  126.17  [Amended]

0
33. In Sec.  126.17:

[[Page 16425]]

0
a. In paragraph (g)(1), remove the reference ``Sec.  120.17'' and add 
in its place ``Sec.  120.50''; and
0
b. In paragraph (o)(1)(iii), remove the phrase ``see Sec.  120.7'' and 
add in its place ``see Sec.  120.36''.


Sec.  126.18  [Amended]

0
34. In Sec.  126.18:
0
a. In paragraph (a), remove the phrase ``(see Sec.  120.6)''; and
0
b. In paragraph (b), remove the references ``Sec.  127.1(b)'' and 
``Sec.  120.16'' and add in their places ``Sec.  127.1(b) of this 
subchapter'' and ``Sec.  120.63 of this subchapter,'' respectively.

0
35. In Supplement No. 1 to part 126:
0
a. In the table, revise the 14th entry ``I-XXI'';
0
b. In Note 5:
0
i. Remove the reference ``Sec.  125.4(c)(6)'' and add in its place 
``Sec.  120.43(g)''; and
0
ii. Remove the reference ``(e)(1), (e)(2), or (e)(4)'' and add in its 
place ``(e)(1), (2), or (4)''; and
0
c. In Note 12:
0
i. Remove the phrase ``applied research (Sec.  125.4(c)(3) of this 
subchapter)'' and add in its place ``applied research (Sec.  120.43(i) 
of this subchapter)'';
0
ii. Remove the reference ``Sec.  125.4(c)(4)'' and add in its place 
``Sec.  120.43(c)'';
0
iii. Remove the reference ``Sec.  125.4(c)(5)'' and add in its place 
``Sec.  120.43(d)'';
0
iv. Remove the reference ``Sec.  125.4(c)(6)'' and add in its place 
``Sec.  120.43(e);
0
v. Remove the reference ``Sec.  125.4(c)(1)'' and add in its place 
``Sec.  120.43(f)'';
0
vi. Remove the reference ``Sec.  125.4(c)(2)'' and add in its place 
``Sec.  120.43(g)''; and
0
vii. Remove the phrase ``basic research as defined in Sec.  125.4(c)(3) 
of this subchapter'' and add in its place ``basic research as defined 
in Sec.  120.43(h) of this subchapter''.
    The revision reads as follows:

Supplement No. 1 to Part 126

* * * * *

----------------------------------------------------------------------------------------------------------------
                                                                  (CA) Sec.        (AS) Sec.        (UK) Sec.
          USML category                    Exclusion                126.5            126.16           126.17
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
I-XXI...........................  Defense services or                       X
                                   technical data specific to
                                   applied research as
                                   defined in Sec.
                                   120.43(i) of this
                                   subchapter, design
                                   methodology as defined in
                                   Sec.   120.43(c) of this
                                   subchapter, engineering
                                   analysis as defined in
                                   Sec.   120.43(d) of this
                                   subchapter, or
                                   manufacturing know-how as
                                   defined in Sec.
                                   120.43(e) of this
                                   subchapter. See Note 12.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------

* * * * *

PART 127--VIOLATIONS AND PENALTIES

0
36. The authority citation for part 127 continues to read as follows:

    Authority:  Sections 2, 38, and 42, Pub. L. 90-629, 90 Stat. 744 
(22 U.S.C. 2752, 2778, 2791); 22 U.S.C. 401; 22 U.S.C. 2651a; 22 
U.S.C. 2779a; 22 U.S.C. 2780; E.O. 13637, 78 FR 16129; Pub. L. 114-
74, 129 Stat. 584.


Sec.  127.1  [Amended]

0
37. In Sec.  127.1, in paragraph (d) introductory text, remove the 
reference ``Sec.  120.1(c)(2)'' everywhere it appears and add in its 
place ``Sec.  120.16(c)''.


Sec.  127.11  [Amended]

0
38. In Sec.  127.11, in paragraph (a), remove the reference ``Sec.  
120.27'' and add in its place ``Sec.  120.6''.


Sec.  127.12  [Amended]

0
39. In Sec.  127.12:
0
a. In paragraph (a), remove the phrase ``(see Sec.  120.14 of this 
subchapter)'';
0
b. In paragraph (c)(1)(i), remove the reference ``127.12(c)(2)'' and 
add in its place ``paragraph (c)(2)'';
0
c. In paragraph (c)(1)(ii), remove the references ``Sec.  120.25'' and 
``Sec.  127.12(c)(2)'' and add in their places ``Sec.  120.67'' and 
``paragraph (c)(2),'' respectively; and
0
d. In paragraph (e), remove the phrase ``See Sec.  120.25'' and add in 
its place ``see Sec.  120.67''.

PART 128--ADMINISTRATIVE PROCEDURES

0
40. The authority citation for part 128 continues to read as follows:

    Authority:  Sections. 2, 38, 40, 42, and 71, Arms Export Control 
Act. 90 Stat. 744 (22 U.S.C. 2752, 2778, 2780, 2791, and 2797); 22 
U.S.C. 2651a; E.O. 12291, 46 FR 1981; E.O. 13637, 78 FR 16129.

0
41. Section 128.1 is revised to read as follows:


Sec.  128.1  Exclusion of functions from the Administrative Procedure 
Act.

    The Arms Export Control Act (AECA) authorizes the President to 
control the import and export of defense articles and services in 
furtherance of world peace and the security and foreign policy of the 
United States. Pursuant to delegated authorities, the Secretary of 
State is authorized to make decisions on whether license applications 
or other written requests for approval shall be granted, or whether 
exemptions may be used. The Secretary of State is also authorized to 
revoke, suspend, or amend licenses or other written approvals whenever 
such action is deemed to be advisable. The administration of the AECA 
is a foreign affairs function encompassed within the meaning of the 
military and foreign affairs exclusion of the Administrative Procedure 
Act and is thereby expressly exempt from various provisions of that 
Act. Because the exercising of the foreign affairs function, including 
the decisions required to implement the AECA, is highly discretionary, 
it is excluded from review under the Administrative Procedure Act.

0
42. Section 128.2 is revised to read as follows:


Sec.  128.2  Administrative Law Judge.

    The Administrative Law Judge referred to in this part is an 
Administrative Law Judge appointed by the Department of State. The 
Administrative Law Judge is authorized to exercise the powers and 
perform the duties provided for in Sec. Sec.  128.3 through 128.16.

PART 129--REGISTRATION AND LICENSING OF BROKERS

0
43. The authority citation for part 129 continues to read as follows:

    Authority:  Section 38, Pub. L. 104-164, 110 Stat. 1437, (22 
U.S.C. 2778); E.O. 13637, 78 FR 16129.


Sec.  129.2  [Amended]

0
44. In Sec.  129.2:

[[Page 16426]]

0
a. In paragraph (a) introductory text, remove the phrase ``see Sec.  
120.14'' and add in its place ``see Sec.  120.61'';
0
b. In paragraph (a)(1), remove the phrase ``see Sec.  120.15'' and add 
in its place ``see Sec.  120.62'';
0
c. In paragraph (a)(2), remove the phrase ``see Sec.  120.16'' and add 
in its place ``see Sec.  120.63'';
0
d. In paragraph (b)(2)(iii), remove the phrase ``see Sec.  120.39'' and 
add in its place ``see Sec.  120.64'';
0
e. In paragraph (b)(2)(v), remove the reference ``Sec.  120.40'' and 
add in its place ``Sec.  120.66''; and
0
f. In paragraph (b)(2)(vi), remove ``see Sec.  120.39'' and ``parts'' 
and add in their places ``see Sec.  120.64'' and ``part,'' 
respectively.


Sec.  129.3  [Amended]

0
45. In Sec.  129.3, in paragraph (d), remove the phrase ``see Sec.  
120.40'' and add in its place ``see Sec.  120.66''.


Sec.  129.4  [Amended]

0
46. In Sec.  129.4, in paragraph (a)(1), remove the phrase ``see Sec.  
120.44'' and add in its place ``see Sec.  120.39''.


Sec.  129.5  [Amended]

0
47. In Sec.  129.5:
0
a. In paragraph (b), remove the phrase ``see Sec.  120.44'' and add in 
its place ``see Sec.  120.39''; and
0
b. In paragraph (c)(2), remove the reference ``Sec.  120.1(c)(2)'' and 
add in its place ``Sec.  120.16(c)''.


Sec.  129.6  [Amended]

0
48. In Sec.  129.6, in paragraphs (a)(2)(i) and (iii), remove the 
reference ``Sec.  120.27'' and add in its place ``Sec.  120.6''.


Sec.  129.8  [Amended]

0
49. In Sec.  129.8:
0
a. In paragraph (a), remove the phrase ``see Sec.  120.40'' and add in 
its place ``see Sec.  120.66'';
0
b. In paragraph (c)(1)(i), remove the reference ``Sec.  120.27'' and 
add in its place ``Sec.  120.6'';
0
c. In paragraph (c)(2), remove the phrase ``see Sec.  120.37'' and add 
in its place ``see Sec.  120.65''; and
0
d. In paragraph (d)(1), remove ``Sec.  120.27'' and ``government'' and 
add in their places ``Sec.  120.6'' and ``Government,'' respectively.

PART 130--POLITICAL CONTRIBUTIONS, FEES AND COMMISSIONS

0
50. The authority citation for part 130 continues to read as follows:

    Authority:  Sec. 39, Pub. L. 94-329, 90 Stat. 767 (22 U.S.C. 
2779); 22 U.S.C. 2651a; E.O. 13637, 78 FR 16129.


Sec.  130.4  [Amended]

0
51. In Sec.  130.4, remove the reference ``Sec. Sec.  120.6 and 120.9'' 
and add in its place ``Sec. Sec.  120.31 and 120.32''.

Bonnie D. Jenkins,
Under Secretary for Arms Control and International Security, Department 
of State.
[FR Doc. 2022-05629 Filed 3-22-22; 8:45 am]
BILLING CODE 4710-25-P