[Federal Register Volume 88, Number 197 (Friday, October 13, 2023)]
[Notices]
[Pages 70928-70930]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-22614]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security


Aviastar--TU) 5 b. 7 Leningradsky prospekt g. Moskva, 125040 
Moscow, Russia; Order Renewing Temporary Denial of Export Privileges

    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 in this 
matter on April 14, 2023. I find that renewal of this order is 
necessary in the public interest to prevent an imminent violation of 
the Regulations.
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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according to their terms until modified, superseded, set aside, or 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 21, 2022, I signed an order denying Aviastar--TU's 
(``Aviastar'') 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\ The temporary denial order was subsequently 
renewed on October 17, 2022 \3\ and again on April 14, 2023,\4\ in 
accordance with Section 766.24(d) of the Regulations.\5\
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    \2\ The TDO was published in the Federal Register on April 26, 
2022 (87 FR 24514).
    \3\ The October 17, 2022 renewal order, which was effective upon 
issuance, was published in the Federal Register on October 20, 2022 
(87 FR 63760).
    \4\ The April 14, 2023 renewal order, which was also effective 
upon issuance, was published in the Federal Register on April 19, 
2023 (88 FR 24162).
    \5\ Section 766.24(d) provides 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. Renewal requests are to be made in writing no 
later than 20 days before the scheduled expiration date of a 
temporary denial order.
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    On September 19, 2023, BIS, through OEE, submitted a written 
request for a third renewal of the TDO. 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 Aviastar 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.

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,

[[Page 70929]]

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).\6\ 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).\7\ 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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    \6\ 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).
    \7\ 87 FR 13048 (Mar. 8, 2022).
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    This OEE request for renewal is based upon the facts underlying the 
issuance of the TDO and the renewal orders subsequently issued in this 
matter on October 17, 2022, and April 14, 2023, as well as other 
evidence developed during this investigation. This evidence 
demonstrates that Aviastar has acted, and continues to act, in blatant 
disregard for U.S. export controls and the terms of existing TDOs. The 
TDO, initially issued on April 21, 2022, was based on evidence that 
Aviastar violated the Regulations by operating multiple aircraft 
subject to the EAR and classified under ECCN 9A991.b on flights into 
and out of Russia after March 2, 2022 from destinations including, but 
not limited to, Hangzhou, China; Shenzhen, China; and Zhengzhou, China 
from/to Novosibirsk, Russia and Abakan, Russia, without the required 
BIS authorization.\8\ Further evidence indicated that Aviastar also 
operated aircraft subject to the EAR on domestic flights within Russia, 
potentially in violation of Section 736.2(b)(10) of the Regulations.
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    \8\ Publicly available flight tracking information shows that on 
April 10, 2022, serial number (SN) 27054 flew from Hangzhou, China 
to Novosibirsk, Russia, and on April 12, 2022, SN 27054 flew from 
Zhengzhou, China to Abakan, Russia. In addition, on April 12, 2022, 
SN 27053 flew from Shenzhen, China to Abakan, Russia.
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    BIS also presented evidence that, while subject to a TDO, Aviastar 
operated aircraft subject to the EAR and classified under ECCN 9A991.b 
on flights both into and out of Russia, in violation of the Regulations 
and the terms of the existing TDO.\9\ Specifically, previous renewal 
orders detailed Aviastar's continued operation of aircraft subject to 
the EAR, including, but not limited to, on flights into and out of 
Russia from/to Zhengzhou, China and Hangzhou, China, as well as on 
domestic flights within Russia.\10\
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    \9\ Engaging in conduct prohibited by a denial order violates 
the Regulations. 15 CFR 764.2(a) and (k).
    \10\ Publicly available flight tracking information shows that 
on May 22, 2022, SN 27054 flew from Zhengzhou, China to Novosibirsk, 
Russia, and on May 25, 2022, SN 27053 flew from Hangzhou, China to 
Novosibirsk, Russia. In addition, on September 22, 2022, SN 25731 
flew from Irkutsk, Russia to Moscow, Russia. On February 24, 2023, 
SN 27053 flew from Novosibirsk, Russia to Mirny, Russia. On March 7, 
2023, SN 25696 flew from Novosibirsk, Russia to Moscow, Russia.
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    In its September 19, 2023 request for TDO renewal, BIS submitted 
evidence that Aviastar violated the TDO and/or the Regulations by 
operating aircraft subject to the EAR and flown into Russia on or after 
March 2, 2022, on flights within Russia, in apparent violation of 
Section 736.2(b)(10) of the Regulations, as well as the TDO. 
Information about those flights includes, but is not limited to, the 
following:

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                                                             Departure/arrival
        Tail No.           Serial No.       Aircraft type          cities                     Dates
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RA-73351...............           25696  757-223 (PCF)       Hangzhou, CN/      April 11, 2022.
                                          (B752).             Novosibirsk, RU.
RA-73351...............           25696  757-223 (PCF)       Zhengzhou, CN/     May 24, 2022.
                                          (B752).             Novosibirsk, RU.
RA-73351...............           25696  757-223 (PCF)       Ulan-Ude, RU/      April 16, 2023.
                                          (B752).             Moscow, RU.
RA-73351...............           25696  757-223 (PCF)       Moscow, RU/        June 3, 2023.
                                          (B752).             Blagoveshchensk,
                                                              RU.
RA-73351...............           25696  757-223 (PCF)       Novosibirsk, RU/   August 31, 2023.
                                          (B752).             Mirny, RU.
RA-73351...............           25696  757-223 (PCF)       Krasnoyarsk, RU/   September 8, 2023.
                                          (B752).             Magadan, RU.
RA-73351...............           25696  757-223 (PCF)       Moscow, RU/Mirny,  September 10, 2023.
                                          (B752).             RU.
RA-73351...............           25696  757-223 (PCF)       Ulan-Ude, RU/      September 16, 2023.
                                          (B752).             Moscow, RU.
RA-73352...............           25731  757-223 (B752)....  Hangzhou, CN/      April 14, 2022.
                                                              Novosibirsk, RU.
RA-73352...............           25731  757-223 (B752)....  Hangzhou, CN/      May 25, 2022.
                                                              Novosibirsk, RU.
RA-73352...............           25731  757-223 (B752)....  Anadyr, RU/Ulan-   August 30, 2023.
                                                              Ude, RU.
RA-73352...............           25731  757-223 (B752)....  Norilsk, RU/       September 22, 2023.
                                                              Moscow, RU.
RA-73352...............           25731  757-223 (B752)....  Ulan-Ude, RU/      September 26, 2023.
                                                              Moscow, RU.
RA-73354...............           27053  757-223 (B752)....  Shenzhen, CN/      April 12, 2022.
                                                              Abakan, RU.
RA-73354...............           27053  757-223 (B752)....  Hangzhou, CN/      May 25, 2022.
                                                              Novosibirsk, RU.
RA-73354...............           27053  757-223 (B752)....  Moscow, RU/        April 18, 2023.
                                                              Novosibirsk, RU.
RA-73354...............           27053  757-223 (B752)....  Nizhnevartovsk,    June 16, 2023.
                                                              RU/Moscow, RU.
RA-73354...............           27053  757-223 (B752)....  Mirny, RU/         August 10, 2023.
                                                              Krasnoyarsk, RU.
RA-73354...............           27053  757-223 (B752)....  Norilsk, RU/       September 8, 2023.
                                                              Moscow, RU.
RA-73354...............           27053  757-223 (B752)....  Ulan-Ude, RU/      September 16, 2023.
                                                              Moscow, RU.
RA-73354...............           27053  757-223 (B752)....  Ulan-Ude, RU/      September 23, 2023.
                                                              Moscow, RU.
RA-73355...............           27054  757-223 (B752)....  Hangzhou, CN/      April 10, 2022.
                                                              Novosibirsk, RU.
RA-73355...............           27054  757-223 (B752)....  Zhengzhou, CN/     May 22, 2022.
                                                              Novosibirsk, RU.
RA-73355...............           27054  757-223 (B752)....  Norilsk, RU/       September 6, 2023.
                                                              Moscow, RU.
RA-73355...............           27054  757-223 (B752)....  Moscow, RU/        September 15, 2023.
                                                              Norilsk, RU.
RA-73355...............           27054  757-223 (B752)....  Norilsk, RU/       September 20, 2023.
                                                              Moscow, RU.
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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 Aviastar has 
acted in violation of the Regulations and the TDO; that such violations 
have been

[[Page 70930]]

significant and deliberate; and that given the foregoing and the nature 
of the matters under investigation, there is a likelihood of imminent 
violations. Therefore, renewal of the TDO 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 Aviastar, 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, Aviastar--TU, 5 b. 7 Leningradsky prospekt, g. Moskva, 
125040, 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:
    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 
Aviastar 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 Aviastar 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 Aviastar 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 Aviastar 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 Aviastar 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 Aviastar, or service any item, of 
whatever origin, that is owned, possessed or controlled by Aviastar 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 Aviastar 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, 
Aviastar 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 Aviastar 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 Aviastar, and shall be 
published in the Federal Register.
    This Order is effective immediately and shall remain in effect for 
180 days.

Matthew S. Axelrod,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2023-22614 Filed 10-12-23; 8:45 am]
BILLING CODE 3510-33-P