[Federal Register Volume 88, Number 70 (Wednesday, April 12, 2023)]
[Rules and Regulations]
[Pages 21910-21912]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-07408]


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DEPARTMENT OF STATE

22 CFR Part 126

[Public Notice: 11862]
RIN 1400-AF55


International Traffic in Arms Regulations: Expansion of Defense 
Articles and Defense Services Eligible for Transfer Under the Canadian 
and Treaty Exemptions

AGENCY: Department of State.

ACTION: Final rule and conforming revisions.

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SUMMARY: The Department of State is amending the International Traffic 
in Arms Regulations (ITAR) to expand the types of defense articles that 
may be exported and defense services that may be furnished pursuant to 
the Treaty between the Government of the United States of America and 
the Government of Australia Concerning Defense Trade Cooperation, 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, and the Canadian exemptions of 
the ITAR. The Department of State is also making clarifying amendments 
and conforming updates.

DATES: The rule is effective on May 12, 2023.

FOR FURTHER INFORMATION CONTACT: Mr. Dilan Wickrema, Office of Defense 
Trade Controls Policy, Department of State, telephone (202) 634-4981; 
email [email protected] ATTN: Regulatory Change, ITAR 
Supplement No.1 to part 126 Amendments.

SUPPLEMENTARY INFORMATION: The rules (Public Notice 7828, 77 FR 16591 & 
Public Notice 8270, 78 FR 21523), published on March 21, 2012 and April 
11, 2013, respectively, amended the ITAR to implement the Treaty 
between the Government of the United States of America and the 
Government of Australia Concerning Defense Trade Cooperation (referred 
to herein as ``the Australia DTC Treaty'') (Treaty Doc. 110-10) and 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 (referred to herein as ``the UK 
DTC Treaty'') (Treaty Doc. 110-7) (together referred to herein as ``the 
Treaty exemptions''), and identified via Supplement No. 1 to part 126 
the defense articles that may not be exported, and defense services 
that may not be furnished, through the use of the Treaty exemptions 
(ITAR Sec. Sec.  126.16 and 126.17) and the Canadian exemptions (ITAR 
Sec.  126.5).
    The Department of State is now amending Supplement No. 1 to part 
126 to expand the types of defense articles that may be exported, and 
defense services that may be furnished, pursuant to the Treaty 
exemptions and Canadian exemptions. The Department of State is 
implementing this amendment after a series of routine consultations 
with its interagency and international counterparts. This amendment is 
intended to ensure the Treaty exemptions and the Canadian exemptions 
continue to enhance operational capabilities, interoperability, and 
cooperation between the armed forces of the United States and its 
allies and partners. While future rulemaking will address other areas 
of the chart, this final rule implements four specific changes to 
Supplement No. 1 to part 126.
    First, this final rule amends the 25th entry, identified as USML 
Category IV which previously excluded ``[d]efense articles and services 
specific to torpedoes,'' to exclude only ``defense articles and 
services specific to the warhead or the sonar, guidance, and control 
section of torpedoes.'' Second, this final rule amends the 105th entry, 
identified as USML Category XX(c), which previously excluded 
``[d]efense articles and services specific to submarine combat control 
systems,'' to remove mounting racks and cabinets from that entry.
    Third, this final rule amends the 60th entry, the 66th entry, and 
explanatory Note 9 to remove specific Underwater Acoustic Decoy 
Countermeasures (ADC) from Supplement No. 1 and clarify the note. 
Fourth, this final rule amends the 28th and 29th entries regarding USML 
Category IV(i) manufacturing know-how and the 67th-70th entries 
regarding USML Category XII night vision. The USML Category IV(i) 
technical data entries are amended to reflect the fact that USML 
Category IV(h) was previously updated (79 FR 34) to describe the 
specific subassemblies of other USML Category IV defense articles that 
remain ITAR-controlled. Similarly, the night vision entries are updated 
to reflect the fact that first generation image intensification tubes 
are not subject to the ITAR, some items previously controlled in 
paragraph (c) of Category XII moved to paragraph (e) in a prior 
rulemaking (81 FR 70340), and to clarify that the technical data and 
defense services entry only applies to paragraph (f) of Category XII.

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 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), pursuant to 
5 U.S.C. 553(a)(1).

Regulatory Flexibility Act

    This rule is exempt from the notice-and-comment rulemaking 
provisions of 5 U.S.C. 553 as a foreign affairs function. Therefore, it 
does not require analysis under the Regulatory Flexibility Act.

Unfunded Mandates Reform Act of 1995

    This rulemaking 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 are deemed necessary under the provisions of the Unfunded 
Mandates Reform Act of 1995.

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, is determined that this amendment 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 all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory

[[Page 21911]]

approaches that maximize net benefits (including potential economic, 
environmental, public health and safety effects, distributed impacts, 
and equity). This rule's scope does not impose additional regulatory 
requirements or obligations; therefore, the Department believes costs 
associated with this rule will be minimal. Although the Department 
cannot determine based on available data how many fewer licenses will 
be submitted as a result of this rule, the amendments to Supplement No. 
1 will relieve licensing burdens for some exporters. Executive Order 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
Because this rule pertains to specific bilateral and multilateral 
relationships, this rule is not a ``significant regulatory action'' as 
the rule ``pertain[s]'' to a ``military or foreign affairs function of 
the United States'' under section 3(d)(2) of Executive Order 12866.

Executive Order 12988

    The Department of State reviewed this rulemaking in light 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 final rule does not impose or revise any new information 
collections subject to 44 U.S.C. chapter 35.

List of Subjects in Part 126

    Arms and munitions, Exports.

    For the reasons set forth above, the Department of State amends 22 
CFR part 126 as follows:

PART 126--GENERAL POLICIES AND PROVISIONS

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

    Authority: 22 U.S.C. 287c, 2651a, 2752, 2753, 2776, 2778, 2779, 
2779a, 2780, 2791, 2797; Sec. 1225, Pub. L. 108-375, 118 Stat. 2091; 
Sec. 7045, Pub. L. 112-74, 125 Stat. 1232; Sec. 1250A, Pub. L 116-
92, 133 Stat. 1665; Sec. 205, Pub. L. 116-94, 133 Stat. 3052; E.O. 
13637, 78 FR 16129, 3 CFR, 2013 Comp., p. 223.


0
2. Amend Supplement No. 1 to part 126 by revising:
0
a. The seven entries for USML Category IV;
0
b. The six entries for USML Category XI;
0
c. The five entries for USML Category XII;
0
d. The entry for USML Category XX(c); and
0
e. Note 9.
    The revisions read as follows:

Supplement No. 1 to Part 126

* * * * *

----------------------------------------------------------------------------------------------------------------
                                                                     (CA) Sec.       (AS) Sec.       (UK) Sec.
         USML category                      Exclusion                  126.5          126.16          126.17
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
IV............................  Defense articles and services                  X               X               X
                                 specific to man-portable air
                                 defense systems (MANPADS). See
                                 Note 6.
IV............................  Defense articles and services     ..............  ..............               X
                                 specific to rockets, designed
                                 or modified for non-military
                                 applications that do not have a
                                 range of 300 km (i.e., not
                                 controlled on the MTCR Annex).
IV............................  Defense articles and services     ..............               X               X
                                 specific to the warhead or the
                                 sonar, guidance, and control
                                 section of torpedoes.
IV............................  Defense articles and services                  X               X               X
                                 specific to anti-personnel
                                 landmines. See Note 15.
IV............................  Defense articles and services                  X               X               X
                                 specific to cluster munitions.
IV(i).........................  Software source code directly     ..............               X               X
                                 related to defense articles
                                 described in USML Category
                                 IV(a), (b), (c), or (g). See
                                 Note 4.
IV(i).........................  Manufacturing know-how directly                X               X               X
                                 related to defense articles
                                 described in USML Category
                                 IV(a), (b), (d), (g), or (h).
                                 See Note 5.
 
                                                  * * * * * * *
XI(a), (c), (d)...............  Defense articles and services     ..............               X               X
                                 specific to countermeasures and
                                 counter- countermeasures, other
                                 than Underwater Acoustic Decoy
                                 Countermeasures (ADC) Mk2 Mods
                                 1 through 7. See Note 9.
XI(a).........................  High Frequency and Phased Array   ..............               X
                                 Microwave Radar systems, with
                                 capabilities such as search,
                                 acquisition, tracking, moving
                                 target indication, and imaging
                                 radar systems. See Note 16.
XI(a), (c), and (d)...........  Defense articles and services     ..............               X               X
                                 specific to naval technology
                                 and systems relating to
                                 acoustic spectrum control and
                                 awareness. See Note 10.
XI(a), (c), and (d)...........  Defense articles and services     ..............               X               X
                                 specific to USML Category XI(b)
                                 (e.g., communications security
                                 (COMSEC) and TEMPEST).
XI(d).........................  Software source code related to   ..............               X               X
                                 USML Category XI(a). See Note 4.
XI(d).........................  Manufacturing know-how related                 X               X               X
                                 to USML Category XI(a)(3) or
                                 XI(a)(4), and specially
                                 designed components therefor.
                                 See Note 5.
 
                                                  * * * * * * *
XII...........................  Defense articles and services     ..............               X               X
                                 specific to countermeasures and
                                 counter- countermeasures, other
                                 than Underwater Acoustic Decoy
                                 Countermeasures (ADC) Mk 2 Mods
                                 1 through 7. See Note 9.

[[Page 21912]]

 
XII...........................  Defense articles and services                  X
                                 specific to USML Category
                                 XII(c) articles, except:.
                                --2nd-generation image
                                 intensification tubes,.
                                --2nd-generation image
                                 intensification night sighting
                                 equipment, and.
                                --end-items in paragraph (c) and
                                 components in paragraphs (e)(4)
                                 through (7) of USML Category
                                 XII, and the following
                                 technical data directly related
                                 thereto:.
                                --technical data limited to
                                 basic operations, maintenance,
                                 and training information as
                                 authorized under the exemption
                                 in Sec.   125.4(b)(5) of this
                                 subchapter for export directly
                                 to a Canadian Government entity
                                 (i.e., federal, provincial,
                                 territorial, or municipal)
                                 consistent with Sec.   126.5,
                                 other exclusions, and the
                                 provisions of this subchapter.
XII(f)........................  Technical data and defense                     X               X               X
                                 services directly related to
                                 night vision commodities beyond
                                 basic operations, maintenance,
                                 and training information,
                                 unless pursuant to a written
                                 solicitation or contract issued
                                 or awarded by the U.S.
                                 Department of Defense for an
                                 end-use identified in paragraph
                                 (e)(1), (2), or (4) of Sec.
                                 126.16 or Sec.   126.17 of this
                                 subchapter.
XII(f)........................  Manufacturing know-how directly                X               X               X
                                 related to any of the
                                 following:
                                --defense articles described in
                                 USML Category XII(d), and.
                                --specially designed parts and
                                 components therefor..
                                See Note 5......................
XII(f)........................  Software source code directly     ..............               X               X
                                 related to defense articles
                                 described in USML Category
                                 XII(a), (b), (c), or (d). See
                                 Note 4.
 
                                                    * * * * *
XX(c).........................  Defense articles and services     ..............               X               X
                                 specific to submarine combat
                                 control systems other than
                                 mounting racks and cabinets.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------

* * * * *
    Note 9: Examples of countermeasures and counter-countermeasures 
related to defense articles not exportable under the AS or UK.
    Treaty exemptions are:
    (a) IR countermeasures;
    (b) Classified techniques and capabilities;
    (c) Exports for precision radio frequency (RF) location that 
directly or indirectly supports fire control and is used for situation 
awareness, target identification, target acquisition, and weapons 
targeting and radio direction finding capabilities. Precision RF 
location is defined as root mean square (RMS) angle of arrival accuracy 
of less than five degrees (5[deg] RMS) and RF emitter location of less 
than ten percent (10%) range error;
    (d) Providing the capability to reprogram; and
    (e) Acoustics (including underwater), active and passive 
countermeasures, and counter-countermeasures other than the Underwater 
Acoustic Decoy Countermeasures (ADC) Mk 2 Mods 1 through 7.
* * * * *

Bonnie Jenkins,
Under Secretary, Arms Control and International Security, Department of 
State.
[FR Doc. 2023-07408 Filed 4-11-23; 8:45 am]
BILLING CODE 4710-25-P