[Federal Register Volume 88, Number 187 (Thursday, September 28, 2023)]
[Notices]
[Pages 66807-66810]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-21173]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security


Order Renewing Temporary Denial of Export Privileges; PJSC 
Aeroflot, 1 Arbat St., 119019, Moscow, Russia

    Pursuant to section 766.24 of the Export Administration 
Regulations, 15 CFR parts 730-774 (``EAR'' or ``the Regulations''),\1\ 
I hereby grant the request of the Office of Export Enforcement 
(``OEE'') to renew the temporary denial order (``TDO'') issued

[[Page 66808]]

in this matter on March 29, 2023. I find that renewal of this order is 
necessary in the public interest to prevent an imminent violation of 
the Regulations and that renewal for an extended period is appropriate 
because PJSC Aeroflot (``Aeroflot'') has engaged in a pattern of 
repeated, ongoing and/or continuous apparent violations of the EAR.
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    \1\ On August 13, 2018, the President signed into law the John 
S. McCain National Defense Authorization Act for Fiscal Year 2019, 
which includes the Export Control Reform Act of 2018, 50 U.S.C. 
4801-4852 (``ECRA''). While section 1766 of ECRA repeals the 
provisions of the Export Administration Act, 50 U.S.C. App. 2401 et 
seq. (``EAA''), (except for three sections which are inapplicable 
here), section 1768 of ECRA provides, in pertinent part, that all 
orders, rules, regulations, and other forms of administrative action 
that were made or issued under the EAA, including as continued in 
effect pursuant to the International Emergency Economic Powers Act, 
50 U.S.C. 1701 et seq. (``IEEPA''), and were in effect as of ECRA's 
date of enactment (August 13, 2018), shall continue in effect 
according to their terms until modified, superseded, set aside, or 
revoked through action undertaken pursuant to the authority provided 
under ECRA. Moreover, section 1761(a)(5) of ECRA authorizes the 
issuance of temporary denial orders. 50 U.S.C. 4820(a)(5).
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I. Procedural History

    On April 7, 2022, I signed an order denying Aeroflot's export 
privileges for a period of 180 days on the ground that issuance of the 
order was necessary in the public interest to prevent an imminent 
violation of the Regulations. The order was issued ex parte pursuant to 
section 766.24(a) of the Regulations and was effective upon 
issuance.\2\ This temporary denial order was subsequently renewed in 
accordance with section 766.24(d) of the Regulations.\3\ The renewal 
order issued on October 3, 2022 and was effective upon issuance.\4\ A 
second renewal order issued on March 29, 2023 and was also effective 
upon issuance.\5\
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    \2\ The TDO was published in the Federal Register on April 12, 
2022 (87 FR 21611).
    \3\ At the time of the renewal, section 766.24(d) provided that 
BIS may seek renewal of a temporary denial order for additional 180-
day renewal periods, if it believes that renewal is necessary in the 
public interest to prevent an imminent violation.
    \4\ The October 3, 2022 renewal order was published in the 
Federal Register on October 7, 2022 (87 FR 60985).
    \5\ The March 29, 2023 renewal order was published in the 
Federal Register on April 3, 2023 (88 FR 19609).
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    On September 5, 2023, BIS, through OEE, submitted a written request 
for renewal of the TDO that issued on March 29, 2023. The written 
request was made more than 20 days before the TDO's scheduled 
expiration and, given the temporary suspension of international mail 
service to Russia, OEE has attempted to deliver a copy of the renewal 
request to Aeroflot by alternative means in accordance with sections 
766.5 and 766.24(d) of the Regulations. No opposition to the renewal of 
the TDO has been received.

II. Renewal of the TDO

A. Legal Standard

    Pursuant to section 766.24, BIS may issue an order temporarily 
denying a respondent's export privileges upon a showing that the order 
is necessary in the public interest to prevent an ``imminent 
violation'' of the Regulations, or any order, license or authorization 
issued thereunder. 15 CFR 766.24(b)(1) and 766.24(d). ``A violation may 
be `imminent' either in time or degree of likelihood.'' 15 CFR 
766.24(b)(3). BIS may show ``either that a violation is about to occur, 
or that the general circumstances of the matter under investigation or 
case under criminal or administrative charges demonstrate a likelihood 
of future violations.'' Id. As to the likelihood of future violations, 
BIS may show that the violation under investigation or charge ``is 
significant, deliberate, covert and/or likely to occur again, rather 
than technical or negligent[.]'' Id. A ``lack of information 
establishing the precise time a violation may occur does not preclude a 
finding that a violation is imminent, so long as there is sufficient 
reason to believe the likelihood of a violation.'' Id.
    If BIS believes that renewal of a denial order is necessary in the 
public interest to prevent an imminent violation, it may file a written 
request for renewal, with any modifications if appropriate. 15 
CFR766.24(d)(1). The written request, which must be filed no later than 
20 days prior to the TDO's expiration, should set forth the basis for 
BIS's belief that renewal is necessary, including any additional or 
changed circumstances. Id. ``In cases demonstrating a pattern of 
repeated, ongoing and/or continuous apparent violations, BIS may 
request the renewal of a temporary denial order for an additional 
period not exceeding one year.'' \6\ Id.
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    \6\ 88 FR 59791 (Aug. 30, 2023).
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B. The TDO and BIS's Request for Renewal

    The U.S. Commerce Department, through BIS, responded to the Russian 
Federation's (``Russia's'') further invasion of Ukraine by implementing 
a sweeping series of stringent export controls that severely restrict 
Russia's access to technologies and other items that it needs to 
sustain its aggressive military capabilities. These controls primarily 
target Russia's defense, aerospace, and maritime sectors and are 
intended to cut off Russia's access to vital technological inputs, 
atrophy key sectors of its industrial base, and undercut Russia's 
strategic ambitions to exert influence on the world stage. Effective 
February 24, 2022, BIS imposed expansive controls on aviation-related 
(e.g., Commerce Control List Categories 7 and 9) items to Russia, 
including a license requirement for the export, reexport or transfer 
(in-country) to Russia of any aircraft or aircraft parts specified in 
Export Control Classification Number (``ECCN'') 9A991 (section 
746.8(a)(1) of the EAR).\7\ BIS will review any export or reexport 
license applications for such items under a policy of denial. See 
section 746.8(b). Effective March 2, 2022, BIS excluded any aircraft 
registered in, owned, or controlled by, or under charter or lease by 
Russia or a national of Russia from being eligible for license 
exception Aircraft, Vessels, and Spacecraft (``AVS'') (section 740.15 
of the EAR).\8\ Accordingly, any U.S.-origin aircraft or foreign 
aircraft that includes more than 25% controlled U.S.-origin content, 
and that is registered in, owned, or controlled by, or under charter or 
lease by Russia or a national of Russia, is subject to a license 
requirement before it can travel to Russia.
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    \7\ 87 FR 12226 (Mar. 3, 2022). Additionally, BIS published a 
final rule effective April 8, 2022, which imposed licensing 
requirements on items controlled on the Commerce Control List 
(``CCL'') under Categories 0-2 that are destined for Russia or 
Belarus. Accordingly, now all CCL items require export, reexport, 
and transfer (in-country) licenses if destined for or within Russia 
or Belarus. 87 FR 22130 (Apr. 14, 2022).
    \8\ 87 FR 13048 (Mar. 8, 2022).
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    OEE's request for renewal for a period of one year is based upon 
the facts underlying the issuance of the initial TDO, the renewal 
orders subsequently issued in this matter, and evidence that continues 
to develop during this investigation. These facts and evidence 
demonstrate that Aeroflot has continued, and continues, to act in 
blatant disregard for U.S. export controls and the terms of previously 
issued TDOs. Specifically, the initial TDO, issued on April 7, 2022, 
was based on evidence that Aeroflot engaged in conduct prohibited by 
the Regulations by operating multiple aircraft subject to the EAR and 
classified under ECCN 9A991.b on flights into Russia after March 2, 
2022, from destinations including, but not limited to, Beijing, China, 
Delhi, India, and Dubai, United Arab Emirates, without the required BIS 
authorization.\9\ Further evidence submitted by BIS indicated that 
Aeroflot was also continuing to operate aircraft subject to the EAR 
domestically on flights within Russia, potentially in violation of 
section 736.2(b)(10) of the Regulations.
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    \9\ Publicly available flight tracking information shows that on 
March 6, 2022, serial number (SN) 65309 flew from Beijing, China to 
Moscow, Russia, and SN 41690 flew from Dubai, UAE to Moscow, Russia. 
In addition, on March 7, 2022, SN 63511 flew from Delhi, India to 
Moscow, Russia.
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    As discussed in the October 3, 2022 and March 29, 2023 renewal 
orders, evidence presented by BIS indicated that, after the renewal 
orders issued, Aeroflot continued to operate aircraft subject to the 
EAR and classified under ECCN 9A991.b on flights both into and within 
Russia, in violation of the

[[Page 66809]]

Regulations and the TDO itself.\10\ Specifically, the October 3, 2022 
renewal order detailed Aeroflot's continued operation of aircraft 
subject to the EAR, including, but not limited to, on flights into and 
out of Russia from/to Minsk, Belarus, Delhi, India, and Istanbul, 
Turkey, as well as within Russia.\11\ Similarly, the March 29, 2023 
renewal order detailed Aeroflot's continued operation of aircraft 
subject to the EAR, including, but not limited to, on flights into and 
out of Russia from/to Yerevan, Armenia, Shanghai, China, Bangkok, 
Thailand, and Urgench, Uzebekistan, as well as domestically within 
Russia.\12\
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    \10\ Engaging in conduct prohibited by a denial order violates 
the Regulations. 15 CFR 764.2(a) and (k).
    \11\ Publicly available flight tracking information shows that 
SN 41690 flew from Istanbul, Turkey to Moscow, Russia on September 
20, 2022 and from Delhi, India to Moscow, Russia on September 23, 
2022. In addition, on September 1, 2022, SN 41214 flew from Minsk, 
Belarus to Moscow, Russia. On September 13, 2022, SN 41214 flew from 
Moscow, Russia to Sochi, Russia.
    \12\ Publicly available flight tracking information shows that 
SN 41214 flew from Yerevan, Armenia to Moscow, Russia on February 
16, 2023 and from Urgench, Uzbekistan to Moscow, Russia on March 1, 
2023. In addition, on March 2, 2023, SN 41214 flew from Moscow, 
Russia to Sochi, Russia. On February 4, 2023, SN 41690 flew from 
Bangkok, Thailand to Moscow, Russia. On March 5, 2023 and March 19, 
2023, respectively, SNs 65309 and 41690 flew from Shanghai, China to 
Moscow, Russia.
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    Since that time, Aeroflot has continued to engage in conduct 
prohibited by the TDO and Regulations. In its September 5, 2023, 
request for renewal of the TDO, BIS submitted evidence that Aeroflot 
continues to operate aircraft subject to the EAR and classified under 
ECCN 9A991.b, both on flights into and within Russia, in violation of 
the March 29, 2023 TDO and/or the Regulations. Specifically, BIS's 
evidence and related investigation demonstrates that Aeroflot has 
continued to operate aircraft subject to the EAR, including, but not 
limited to, on flights into and out of Russia from/to Yerevan, Armenia, 
Beijing, China, Delhi, India, Male, Maldives, Istanbul, Turkey, Phuket, 
Thailand, Dubai, Sharm el-Sheikh, Egypt, United Arab Emirates, and 
Tashkent, Uzbekistan, as well as domestically within Russia. 
Information about those flights includes, but is not limited to, the 
following:

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       Tail No.           Serial No.                   Aircraft type                Departure/arrival cities                     Dates
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RA-73126..............           41214  737-8LJ (B738)............................  Yerevan, AM/Moscow, RU..  September 12, 2023.
RA-73126..............           41214  737-8LJ (B738)............................  Moscow, RU/St.            September 13, 2023.
                                                                                     Petersburg, RU.
RA-73126..............           41214  737-8LJ (B738)............................  Istanbul, TR/St.          September 13, 2023.
                                                                                     Petersburg, RU.
RA-73126..............           41214  737-8LJ (B738)............................  Dubai, AE/Moscow, RU....  September 15, 2023.
RA-73126..............           41214  737-8LJ (B738)............................  Yerevan, AM/Moscow, RU..  September 18, 2023.
RA-73126..............           41214  737-8LJ (B738)............................  Istanbul, TR/Moscow, RU.  September 19, 2023.
RA-73144..............           41690  777-3M0 (ER) (B77W).......................  Beijing, CN/Moscow, RU..  August 7, 2023.
RA-73144..............           41690  777-3M0 (ER) (B77W).......................  Moscow, RU/Vladivostok..  August 7, 2023.
RA-73144..............           41690  777-3M0 (ER) (B77W).......................  Phuket, TH/Moscow, RU...  August 12, 2023.
RA-73144..............           41690  777-3M0 (ER) (B77W).......................  Moscow, RU/Vladivostok,   August 13, 2023.
                                                                                     RU.
RA-73144..............           41690  777-3M0 (ER) (B77W).......................  Phuket, TH/Khabarovsk,    August 14, 2023.
                                                                                     RU.
RA-73144..............           41690  777-3M0 (ER) (B77W).......................  Antalya, TR/Moscow, RU..  August 24, 2023.
RA-73144..............           41690  777-3M0 (ER) (B77W).......................  Beijing, CN/Moscow, RU..  August 31, 2023.
RA-73144..............           41690  777-3M0 (ER) (B77W).......................  Delhi, IN/Moscow, RU....  September 2, 2023.
RA-73146..............           65309  777-300 (ER) (B77W).......................  Bangkok, TH/Moscow, RU..  September 3, 2023.
RA-73146..............           65309  777-300 (ER) (B77W).......................  Moscow, RU/Vladivostok,   September 6, 2023.
                                                                                     RU.
RA-73146..............           65309  777-300 (ER) (B77W).......................  Shanghai, CN/Moscow, RU.  September 11, 2023.
RA-73146..............           65309  777-300 (ER) (B77W).......................  Male, MV/Moscow, RU.....  September 13, 2023.
RA-73146..............           65309  777-300 (ER) (B77W).......................  Moscow, RU/Vladivostok,   September 16, 2023.
                                                                                     RU.
RA-73146..............           65309  777-300 (ER) (B77W).......................  Vladivostok, RU/Moscow,   September 17, 2023.
                                                                                     RU.
RA-73146..............           65309  777-300 (ER) (B77W).......................  Shanghai, CN/Moscow, RU.  September 18, 2023.
RA-73146..............           65309  777-300 (ER) (B77W).......................  Delhi, IN/Moscow, RU....  September 19, 2023.
RA-73150..............           65307  777-3M0 (ER) (B77W).......................  Hurghada, EG/Moscow, RU.  August 12, 2023.
RA-73150..............           65307  777-3M0 (ER) (B77W).......................  Sharm el-Sheikh, EG/      August 14, 2023.
                                                                                     Moscow, RU.
RA-73150..............           65307  777-3M0 (ER) (B77W).......................  Hurghada, EG/Moscow, RU.  September 5, 2023.
RA-73150..............           65307  777-3M0 (ER) (B77W).......................  Moscow, RU/Vladivostok,   September 6, 2023.
                                                                                     RU.
RA-73150..............           65307  777-3M0 (ER) (B77W).......................  Tashkent, UZ/Moscow, RU.  September 8, 2023.
RA-73150..............           65307  777-3M0 (ER) (B77W).......................  Sharm el-Sheikh, EG/      September 13, 2023.
                                                                                     Moscow, RU.
RA-73150..............           65307  777-3M0 (ER) (B77W).......................  Hurghada, EQ/Moscow, RU.  September 14, 2023.
RA-73150..............           65307  777-3M0 (ER) (B77W).......................  Antalya, TR/Moscow, RU..  September 17, 2023.
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III. Findings

    Under the applicable standard set forth in section 766.24 of the 
Regulations and my review of the entire record, I find that the 
evidence presented by BIS convincingly demonstrates that Aeroflot has 
acted in violation of the Regulations and the TDO; that such violations 
have been significant, deliberate and covert; and that given the 
foregoing and the nature of the matters under investigation, there is a 
likelihood of imminent violations. Moreover, I find that renewal for an 
extended period is appropriate because Aeroflot has engaged in a 
pattern of repeated, ongoing and/or continuous apparent violations of 
the EAR. Therefore, renewal of the TDO for one year is necessary in the 
public interest to prevent imminent violation of the Regulations and to 
give notice to companies and individuals in the United States and 
abroad that they should avoid dealing with Aeroflot, in connection with 
export and reexport transactions involving items subject to the 
Regulations and in connection with any other activity subject to the 
Regulations.

IV. Order

    It is therefore ordered:
    First, PJSC Aeroflot, 1 Arbat St., 119019, Moscow, Russia, when 
acting for or on their behalf, any successors or assigns, agents, or 
employees may not, directly or indirectly, participate in any way in 
any transaction involving any commodity, software or technology 
(hereinafter collectively referred to as ``item'') exported or to be 
exported from the United States that is subject to the EAR, or in any 
other activity subject to the EAR including, but not limited to:

[[Page 66810]]

    A. Applying for, obtaining, or using any license (except directly 
related to safety of flight), license exception, or export control 
document;
    B. Carrying on negotiations concerning, or ordering, buying, 
receiving, using, selling, delivering, storing, disposing of, 
forwarding, transporting, financing, or otherwise servicing in any way, 
any transaction involving any item exported or to be exported from the 
United States that is subject to the EAR except directly related to 
safety of flight and authorized by BIS pursuant to section 764.3(a)(2) 
of the Regulations, or engaging in any other activity subject to the 
EAR except directly related to safety of flight and authorized by BIS 
pursuant to section 764.3(a)(2) of the Regulations; or
    C. Benefitting in any way from any transaction involving any item 
exported or to be exported from the United States that is subject to 
the EAR, or from any other activity subject to the EAR except directly 
related to safety of flight and authorized by BIS pursuant to section 
764.3(a)(2) of the Regulations.
    Second, that no person may, directly or indirectly, do any of the 
following:
    A. Export, reexport, or transfer (in-country) to or on behalf of 
Aeroflot any item subject to the EAR except directly related to safety 
of flight and authorized by BIS pursuant to section 764.3(a)(2) of the 
Regulations;
    B. Take any action that facilitates the acquisition or attempted 
acquisition by Aeroflot of the ownership, possession, or control of any 
item subject to the EAR that has been or will be exported from the 
United States, including financing or other support activities related 
to a transaction whereby Aeroflot acquires or attempts to acquire such 
ownership, possession or control except directly related to safety of 
flight and authorized by BIS pursuant to section 764.3(a)(2) of the 
Regulations;
    C. Take any action to acquire from or to facilitate the acquisition 
or attempted acquisition from Aeroflot of any item subject to the EAR 
that has been exported from the United States except directly related 
to safety of flight and authorized by BIS pursuant to section 
764.3(a)(2) of the Regulations;
    D. Obtain from Aeroflot in the United States any item subject to 
the EAR with knowledge or reason to know that the item will be, or is 
intended to be, exported from the United States except directly related 
to safety of flight and authorized by BIS pursuant to section 
764.3(a)(2) of the Regulations; or
    E. Engage in any transaction to service any item subject to the EAR 
that has been or will be exported from the United States and which is 
owned, possessed or controlled by Aeroflot, or service any item, of 
whatever origin, that is owned, possessed or controlled by Aeroflot if 
such service involves the use of any item subject to the EAR that has 
been or will be exported from the United States except directly related 
to safety of flight and authorized by BIS pursuant to section 
764.3(a)(2) of the Regulations. For purposes of this paragraph, 
servicing means installation, maintenance, repair, modification, or 
testing.
    Third, that, after notice and opportunity for comment as provided 
in section 766.23 of the EAR, any other person, firm, corporation, or 
business organization related to Aeroflot by ownership, control, 
position of responsibility, affiliation, or other connection in the 
conduct of trade or business may also be made subject to the provisions 
of this Order.
    In accordance with the provisions of sections 766.24(e) of the EAR, 
Aeroflot may, at any time, appeal this Order by filing a full written 
statement in support of the appeal with the Office of the 
Administrative Law Judge, U.S. Coast Guard ALJ Docketing Center, 40 
South Gay Street, Baltimore, Maryland 21202-4022.
    In accordance with the provisions of section 766.24(d) of the EAR, 
BIS may seek renewal of this Order by filing a written request not 
later than 20 days before the expiration date. A renewal request may be 
opposed by Aeroflot as provided in section 766.24(d), by filing a 
written submission with the Assistant Secretary of Commerce for Export 
Enforcement, which must be received not later than seven days before 
the expiration date of the Order.
    A copy of this Order shall be provided to Aeroflot, and shall be 
published in the Federal Register.
    This Order is effective immediately and shall remain in effect for 
one year.

Matthew S. Axelrod,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2023-21173 Filed 9-27-23; 8:45 am]
BILLING CODE 3510-DT-P