[Federal Register Volume 89, Number 78 (Monday, April 22, 2024)]
[Rules and Regulations]
[Pages 29254-29257]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-08622]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR Part 746

[Docket No. 240417-0112]
RIN 0694-AJ61


Export Control Measures Under the Export Administration 
Regulations (EAR) To Address Iranian Aggression Against Israel and 
Military Support for Russia

AGENCY: Bureau of Industry and Security, Department of Commerce.

ACTION: Final rule.

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SUMMARY: In this final rule, the Bureau of Industry and Security (BIS) 
makes changes to the Export Administration Regulations (EAR) to expand 
the scope of items that require a license for export and reexport to 
Iran; this rule also expands the scope of the Russia/Belarus/
Temporarily occupied Crimea region of Ukraine Foreign Direct Product 
(FDP) rule and the Iran FDP rule. Certain foreign-made items located 
outside of the United States are subject to the EAR because they meet 
criteria specified under one of the FDP rules under the EAR. This final 
rule expands the product scope of two of the FDP rules to make 
additional items subject to the EAR and imposes a license requirement 
when they are reexported or exported from abroad to Iran, Russia, 
Belarus, or the Temporarily occupied Crimea region of Ukraine. Prior to 
this rule, BIS had not controlled all foreign transactions involving 
items covered by this rule, but in light of recent events and the need 
to fully leverage EAR controls to address U.S. national security and 
foreign policy interests, these additional controls are now warranted 
under the EAR.

DATES: This rule is effective on April 18, 2024.

FOR FURTHER INFORMATION CONTACT: For questions on this final rule, 
contact Tracy Patts, Supervisory Export Policy Analyst, Office of 
Nonproliferation and Foreign Policy Controls, Bureau of Industry and 
Security, Department of Commerce, Phone: 202-482-4252, Email: 
[email protected]
    For emails, include ``supplement no. 7'' in the subject line.

SUPPLEMENTARY INFORMATION:

I. Background

    On April 13, 2024, the Islamic Republic of Iran and its proxies 
conducted an unprecedented air attack on Israel. Iran's destabilizing 
actions endanger the region and all its people. In addition, Iran's 
military cooperation with Russia has increased Russia's capacity to 
wage war against Ukraine while enabling advancements in Iran's and 
Russia's military capabilities. Consistent with the U.S. Government's 
commitment to restrict Iran from obtaining any item that might 
contribute to its manufacture of missiles, including those used against 
Israel and Ukraine, this rule amends the EAR to impose new controls 
restricting Iran's access to additional low-level technology, including 
items manufactured outside the United States that are produced using 
U.S. technology, i.e., through the Iran FDP Rule in Sec.  734.9(j) of 
the EAR.
    Iran is already subject to comprehensive export restrictions under 
U.S. law, including licensing requirements described in Sec.  746.7 of 
the EAR. This rule builds on BIS's February 2023 action that targeted 
Iran's involvement in supplying Unmanned Aerial Vehicles (UAVs) in 
support of Russia's war in Ukraine (see 88 FR 12150, February 24, 2023) 
In that rule, BIS imposed export and reexport license requirements on a 
subset of EAR99 items, i.e., items not specified on the Commerce 
Control List (CCL, supplement no. 1 to part 774 of the EAR) if destined 
to Iran, regardless of whether a U.S. person is involved in the 
transaction. BIS also added a new Iran Foreign Direct Product rule for 
items in certain categories of the CCL and for certain other items 
identified by Harmonized Tariff System Codes at the six-digit level 
(HTS-6 Codes) in supplement no. 7 to part 746 of the EAR in the 
February 24, 2023 rule. On January 23, 2024, BIS expanded the list of 
items included in supplement no. 7 to part 746 of the EAR (see 89 FR 
4804, January 23, 2024).
    Russia, Belarus, and certain temporarily occupied regions of 
Ukraine have been subjected to increasing export controls since 
Russia's full-scale invasion of Ukraine on February 24, 2022. There are 
now thousands of categories of items controlled to these destinations, 
including those controlled together with substantially aligned allies 
and partners in the Global Export Control Coalition (GECC). Export 
controls in the EAR extend to foreign produced items caught by the 
Russia/Belarus/Temporarily occupied Crimea region of Ukraine FDP rule 
in Sec.  734.9(f) of the EAR (Russia FDPR), ensuring that foreign items 
produced with controlled software and technology are also caught by 
U.S. restrictions. The continued expansion of controls on Russia, 
Belarus, and the temporarily occupied regions of Ukraine meets U.S. 
national security and foreign policy objectives to continue the 
degradation of Russia's ability to execute its war against Ukraine.
    This action is consistent with U.S. policy objectives to continue 
to strengthen the impact of export control measures in response to 
Iran's attack on Israel and Iran's support for Russia's war in Ukraine 
by limiting Iran's and Russia's access to certain EAR99 items critical 
to their weapons programs.

II. Overview of New Controls

    This rule revises the EAR to enhance and strengthen existing 
measures against Iran, Russia, and Belarus. Specifically, this rule 
further expands the list of items included in supplement no. 7 to part 
746 to include additional items that are critical to Iran and

[[Page 29255]]

Russia's weapons programs. The export control measures in this final 
rule build upon the national security and foreign policy objectives of 
the United States. The expansion of items included in supplement no. 7 
to part 746 will enhance the effectiveness of export controls on Iran 
and Russia by further limiting access to items that enable their 
military capabilities.
    While BIS's controls cover a vast array of items necessary to the 
defense industries of Iran and Russia, certain items are more 
significant to their weaponry than others. The items in supplement no. 
7 to part 746 will now include the entirety of the `Common High 
Priority List' (CHPL). (See https://www.bis.doc.gov/index.php/all-articles/13-policy-guidance/country-guidance/2172-russia-export-controls-list-of-common-high-priority-items) BIS, in coordination with 
its partners in the European Union, Japan, and the United Kingdom, 
developed the CHPL to jointly identify items used in Russian weapons 
development by HTS-6 Codes. The 50 CHPL HTS-6 Codes include electronic 
components such as integrated circuits and radio frequency (RF) 
transceiver modules, items essential for the manufacturing and testing 
of electronic components, and computer numerically controlled (CNC) 
machine tools. Iran's drone program is also dependent on foreign 
sources for these items. In adding 39 additional items to supplement 
no. 7 to part 746, the supplement will now include all 50 Common High 
Priority items.

III. Amendments to the EAR

    This rule expands the list of items in supplement no. 7 to part 746 
(Items That Require a License Under Sec.  746.6 When Destined to the 
Temporarily Occupied Crimea region of Ukraine, Under Sec.  746.7 When 
Destined to Iran, and Under Sec.  746.8 When Destined to Russia or 
Belarus) by adding 39 additional HTS-6 Code entries (845710, 845811, 
845891, 845961, 846693, 847180, 848210, 848220, 848230, 848250, 848610, 
848620, 848640, 850440, 851769, 852589, 852990, 853400, 853669, 853690, 
854110, 854121, 854129, 854130, 854149, 854151, 854159, 854160, 854320, 
880730, 901310, 901380, 901420, 901480, 902750, 903020, 903032, 903039, 
and 903082).
    All items subject to the EAR that are classified under these HTS-6 
entries already require a license for export, reexport, or transfer 
(in-country) to Russia and Belarus under Sec.  746.5 of the EAR. In 
addition, CCL and U.S.-origin EAR99 items classified under these HTS-6 
entries are prohibited for export or reexport to Iran under Sec.  
746.7(e) of the EAR. By adding these items to supplement no. 7 to part 
746, BIS jurisdiction over foreign produced items in these categories 
will be expanded, which will in turn expand license requirements for 
Russia and Belarus under Sec.  746.8(a)(2). The addition of these codes 
to supplement no. 7 to part 746 will also expand EAR restrictions over 
foreign transactions with Iran under Sec.  746.7(a). The restrictions 
on these items are intended to further undermine the ability of Iran 
and Russia to support the production of missiles, drones, and other 
military items for use against Israel and Ukraine.

Savings Clause

    Shipments of items removed from eligibility for a License Exception 
or export, reexport, or transfer (in-country) without a license (NLR) 
as a result of this regulatory action that were en route aboard a 
carrier to a port of export, reexport, or transfer (in-country), on 
April 18, 2024, pursuant to actual orders for export, reexport, or 
transfer (in-country) to or within a foreign destination, may proceed 
to that destination under the previous eligibility for a License 
Exception or export, reexport, or transfer (in-country) without a 
license (NLR), provided the export, reexport, or transfer (in-country) 
is completed no later than on May 20, 2024.

Export Control Reform Act of 2018

    On August 13, 2018, the President signed into law the John S. 
McCain National Defense Authorization Act for Fiscal Year 2019, which 
included the Export Control Reform Act of 2018 (ECRA) (codified, as 
amended, at 50 U.S.C. 4801-4852). ECRA provides the legal basis for 
BIS's principal authorities and serves as the authority under which BIS 
issues this rule.

Rulemaking Requirements

    1. BIS has examined the impact of this rule as required by 
Executive Orders 12866, 13563, and 14094, which direct agencies to 
assess all costs and benefits of available regulatory alternatives and, 
if regulation is necessary, to select regulatory approaches that 
maximize net benefits (e.g., potential economic, environmental, public, 
health, and safety effects, distributive impacts, and equity). Pursuant 
to E.O. 12866, as amended, this final rule is not a ``significant 
regulatory action.''
    2. Notwithstanding any other provision of law, no person is 
required to respond to, nor shall any person be subject to a penalty 
for failure to comply with, a collection of information subject to the 
requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et 
seq.) (PRA), unless that collection of information displays a currently 
valid Office of Management and Budget (OMB) Control Number. This rule 
involves the following OMB-approved collections of information subject 
to the PRA:
     0694-0088, ``Simple Network Application Process and 
Multipurpose Application Form,'' which carries a burden hour estimate 
of 29.4 minutes for a manual or electronic submission;
     0694-0096 ``Five Year Records Retention Period,'' which 
carries a burden hour estimate of less than 1 minute; and
     0607-0152 ``Automated Export System (AES) Program,'' which 
carries a burden hour estimate of 3 minutes per electronic submission.
    BIS estimates that these new controls on Iran under the EAR will 
result in an increase of five license applications submitted annually 
to BIS. However, the additional burden falls within the existing 
estimates currently associated with these control numbers. Additional 
information regarding these collections of information--including all 
background materials--can be found at https://www.reginfo.gov/public/do/PRAMain by using the search function to enter either the title of 
the collection or the OMB Control Number.
    3. This rule does not contain policies with federalism implications 
as that term is defined in E.O. 13132.
    4. Pursuant to section 1762 of ECRA (50 U.S.C. 4821), this action 
is exempt from the Administrative Procedure Act (APA) (5 U.S.C. 553) 
requirements for notice of proposed rulemaking, opportunity for public 
participation, and delay in effective date. While section 1762 of ECRA 
provides sufficient authority for such an exemption, this action is 
also independently exempt from these APA requirements because it 
involves a military or foreign affairs function of the United States (5 
U.S.C. 553(a)(1)).
    5. Because neither the Administrative Procedure Act nor any other 
law requires that notice of proposed rulemaking and an opportunity for 
public comment be given for this rule, the analytical requirements of 
the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) are not 
applicable. Accordingly, no Final Regulatory Flexibility Analysis is 
required and none has been prepared.

List of Subjects in 15 CFR Part 746

    Exports, Reporting and recordkeeping requirements.

    For the reasons stated in the preamble, part 746 of the Export

[[Page 29256]]

Administration Regulations (15 CFR parts 730 through 774) is amended as 
follows:

PART 746--EMBARGOES AND OTHER SPECIAL CONTROLS

0
1. The authority citation for 15 CFR part 746 is revised to read as 
follows:

    Authority:  50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.; 50 
U.S.C. 1701 et seq.; 22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; 22 
U.S.C. 7201 et seq.; 22 U.S.C. 7210; E.O. 12058, 43 FR 20947, 3 CFR, 
1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p. 
608; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13026, 
61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13099, 63 FR 45167, 3 
CFR, 1998 Comp., p. 208; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., 
p. 783; E.O. 13224, 66 FR 49079, 3 CFR, 2001 Comp., p. 786; Notice 
of September 19, 2022, 87 FR 57569 (September 21, 202); Notice of 
November 8, 2022, 87 FR 68015, 3 CFR, 2022 Comp., p. 563; Notice of 
September 7, 2023, 88 FR 62439 (September 11, 2023).


0
2. Supplement no. 7 to part 746 is amended by adding in numerical order 
the following entries to the table: 845710, 845811, 845891, 845961, 
846693, 847180, 848210, 848220, 848230, 848250, 848610, 848620, 848640, 
850440, 851769, 852589, 852990, 853400, 853669, 853690, 854110, 854121, 
854129, 854130, 854149, 854151, 854159, 854160, 854320, 880730, 901310, 
901380, 901420, 901480, 902750, 903020, 903032, 903039, and 903082.

Supplement No. 7 to Part 746--Items That Require a License Under Sec.  
746.6 When Destined to the Temporarily Occupied Crimea Region of 
Ukraine, Under Sec.  746.7 When Destined to Iran, and Under Sec.  746.8 
When Destined to Russia or Belarus

* * * * *

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       HTS-6 codes                        HTS description
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                              * * * * * * *
845710...................  Machining centers for working metal.
845811...................  Horizontal lathes for removing metal,
                            numerically controlled.
845891...................  Lathes, excluding horizontal, for removing
                            metal, numerically controlled.
845961...................  Milling machines, not knee type, for removing
                            metal, numerically controlled.
846693...................  Parts and accessories for machine tools, for
                            laser operation, metalworking machining
                            centers, lathes and drilling machines, etc.,
                            NESOI.
 
                              * * * * * * *
847180...................  Automatic data processing units, NESOI.
848210...................  Ball bearings.
848220...................  Tapered roller bearings, including cone and
                            tapered roller assemblies.
848230...................  Spherical roller bearings.
848250...................  Cylindrical roller bearings NESOI.
848610...................  Machines and apparatus for the manufacture of
                            boules or wafers.
848620...................  Machines and apparatus for the manufacture of
                            semiconductor devices or of electronic
                            integrated circuits.
848640...................  Machines and apparatus for the manufacture or
                            repair of masks and reticles; for assembling
                            semiconductors devices; for lifting,
                            handling, loading or unloading of semi-
                            conductor devices.
850440...................  Electrical static converters; power supplies
                            for ADP machines or units of 8471.
 
                              * * * * * * *
851769...................  Apparatus for the transmission or reception
                            of voice, images or other data, including
                            switching and routing apparatus, NESOI.
852589...................  Television cameras, digital cameras and video
                            camera recorders.
 
                              * * * * * * *
852990...................  Parts (except antennas and reflectors) sfor
                            use with radio transmission, radar, radio
                            navigational aid, reception and television
                            apparatus, NESOI.
 
                              * * * * * * *
853400...................  Printed circuits.
853669...................  Electric plugs and sockets for a voltage not
                            exceeding 1,000 V.
853690...................  Electrical apparatus for switching,
                            protecting or making connections to or in
                            electrical circuits, for a voltage not
                            exceeding 1,000 V, NESOI.
854110...................  Diodes, other than photosensitive or light-
                            emitting diodes.
854121...................  Transistors, other than photosensitive, with
                            a dissipation rate of less than 1W.
854129...................  Transistors, other than photosensitive,
                            NESOI.
854130...................  Thyristors, diacs and triacs, other than
                            photosensitive devices.
854149...................  Photosensitive semiconductor devices,
                            excluding photovoltaic generators and cells.
854151...................  Semiconductor-based transducers, NESOI.
854159...................  Semiconductor devices NESOI.
854160...................  Mounted piezoelectric crystals.
 
                              * * * * * * *
854320...................  Electrical signal generators.
 
                              * * * * * * *
880730...................  Other parts of airplanes, helicopters or
                            unmanned aircraft.
901310...................  Telescopic sights for fitting to arms;
                            periscopes; telescopes designed to form
                            parts of machines, appliances, instruments
                            or apparatus of this chapter or Section XVI.
901380...................  Other optical devices, appliances and
                            instruments not elsewhere specified.
901420...................  Instruments and appliances for aeronautical
                            or space navigation (other than compasses).
901480...................  Other navigational instruments and
                            appliances.
902750...................  Other instruments and apparatus using optical
                            radiations (ultraviolet, visible, infrared).
903020...................  Oscilloscopes and oscillographs.
903032...................  Multimeters with recording device.

[[Page 29257]]

 
903039...................  Instruments and apparatus for measuring or
                            checking voltage, current, resistance or
                            electrical power, with recording device.
903082...................  Oscilloscopes, spectrum analyzers and other
                            instruments and apparatus for measuring or
                            checking electrical quantities, for
                            measuring or checking semiconductor wafers
                            or devices.
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Thea D. Rozman Kendler,
Assistant Secretary for Export Administration.
[FR Doc. 2024-08622 Filed 4-18-24; 11:15 am]
BILLING CODE 3510-JT-P