[Federal Register Volume 89, Number 138 (Thursday, July 18, 2024)]
[Rules and Regulations]
[Pages 58263-58265]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-15258]


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DEPARTMENT OF COMMERCE

Office of the Secretary

15 CFR Part 7

Bureau of Industry and Security

15 CFR Part 791

[Docket No. 240620-0169]
RIN 0694-AJ71


Redesignation of Regulations for Securing the Information and 
Communications Technology and Services Supply Chain

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

ACTION: Final rule.

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SUMMARY: This rule redesignates regulations governing the procedures 
for the review of certain transactions involving information and 
communications technology and services (ICTS) designed, developed, 
manufactured, or supplied by persons owned by, controlled by, or 
subject to the jurisdiction or direction of a foreign adversary and 
which pose or may pose undue or unacceptable risks to the United States 
or U.S. persons. This action reflects the transfer of responsibility 
for implementing these regulations from the Secretary of Commerce to 
the Bureau of Industry and Security (BIS), Office of Information and 
Communications Technology and Services (OICTS).

DATES: This rule is effective July 18, 2024.

FOR FURTHER INFORMATION CONTACT: Rachel O'Meara, U.S. Department of 
Commerce, telephone: (202) 482-4124, email: [email protected]. For 
media inquiries: Jessica Stallone, Office of Congressional and Public 
Affairs, Bureau of Industry and Security, U.S. Department of Commerce: 
[email protected].

[[Page 58264]]


SUPPLEMENTARY INFORMATION:

I. Introduction

    This final rule is a procedural action to redesignate U.S. 
Department of Commerce (Department) regulations that govern the 
procedures for the review of certain transactions involving ICTS 
designed, developed, manufactured, or supplied by persons owned by, 
controlled by, or subject to the jurisdiction or direction of a foreign 
adversary and which pose or may pose undue or unacceptable risks to the 
United States or U.S. persons. Responsibility for implementing these 
regulations lies within the BIS's OICTS. This action moves regulations 
from subtitle A in the Code of Federal Regulations (CFR), which is 
generally reserved for Secretarial actions and Department-wide 
activities and operations, to chapter VII in title 15 of the CFR, where 
BIS regulations are located. Specifically, this action removes the 
regulations in title 15, subtitle A, part 7 (under the ``Office of the 
Secretary of Commerce''), reserving that part, and redesignates them as 
title 15, subtitle B, chapter VII, part 791 (under the ``Bureau of 
Industry and Security, Department of Commerce'').
    The provisions being redesignated were originally administered by 
the Office of the Secretary, but were formally transferred to BIS when 
OICTS was established on March 15, 2022 (consistent with the 
Consolidated Appropriations Act for Fiscal Year 2022). Therefore, the 
Department is transferring the regulations to subtitle B, ``Regulations 
Relating to Commerce and Foreign Trade,'' chapter VII, ``Bureau of 
Industry and Security, Department of Commerce.'' title 15, subtitle B, 
chapter VII regulations are specific to BIS authorities and processes. 
This is a procedural change that does not impact any processes of the 
Department or BIS, and will have no impact on any public or private 
entity outside of BIS.

II. Background

    The existing 15 CFR part 7 regulations, which are being 
redesignated, implement Executive Orders (E.O.s), E.O. 13873, 
``Securing the Information and Communications Technology and Services 
Supply Chain'' (84 FR 22689, May 17, 2019) and E.O. 14034, ``Protecting 
Americans' Sensitive Data From Foreign Adversaries'' (86 FR 31423, June 
11, 2021).
    E.O. 13873 declares a national emergency under the National 
Emergencies Act (50 U.S.C. Ch. 34, section 1601 et seq.) and invokes 
the International Emergency Economic Powers Act (IEEPA) (50 U.S.C. 1701 
et seq.) to take certain actions regarding the unrestricted acquisition 
and use in the United States of certain information and communication 
technology and services (ICTS) and classes of ICTS designed, developed, 
manufactured, or supplied by persons owned by, controlled by, or 
subject to the jurisdiction or direction of foreign adversaries. E.O. 
13873 authorizes the Secretary, pursuant to IEEPA, to prohibit certain 
ICTS transactions or approve them subject to the establishment of 
measures to mitigate identified risks. To implement E.O. 13873, on 
January 19, 2021, the Department published an interim final rule (86 FR 
4909) creating 15 CFR part 7, which sets forth definitions and 
procedures for the Department to review and determine whether ICTS 
transactions involving entities with a foreign adversary nexus and U.S. 
entities present an undue risk of sabotage to or subversion of the ICTS 
supply chain, or an unacceptable risk to U.S. persons or national 
security.
    E.O. 14034 (86 FR 31423), elaborates on measures to address the 
national emergency declared in E.O. 13873 with respect to the ICTS 
supply chain and authorizes the Secretary to evaluate connected 
software application transactions that may pose an unacceptable risk to 
the national security of the United States or the security and safety 
of U.S. persons. To implement E.O. 14034, the Department published a 
Final Rule (88 FR 39353) that amended 15 CFR 7.1, 7.2, and 7.3.
    In June 2023, consistent with the Consolidated Appropriations Act 
for Fiscal Year 2022, responsibility for implementing the authorities 
in E.O.s 13873 and 14034, as described above, was transferred by the 
Secretary to the Deputy Under Secretary of Commerce for Industry and 
Security, and OICTS was established, with responsibilities managed by 
an Executive Director who reports to the Under Secretary of Commerce 
for Industry and Security.

III. Establishment of Subchapter E in Chapter VII and Realignment

    Consistent with this transfer, this final rule redesignates the 
regulations that were promulgated as 15 CFR part 7 of Subtitle A--
``Office of the Secretary of Commerce''--to Subtitle B--``Regulations 
Relating to Commerce and Foreign Trade.'' Within subtitle B, chapter 
VII includes other regulations that implement BIS authorities. This 
final rule also establishes Subchapter E, following Subchapter D, and 
creates a new part 791 for OICTS's regulations. Subchapter E is titled 
``Information and Communications Technology and Services Regulations.''
    The redesignation in this final rule clarifies to the public that 
BIS, not the Office of the Secretary, is responsible for implementation 
of the ICTS regulations. This shift in no way impacts the content or 
text of current and proposed regulations. Because of this, publication 
of this final rule is merely procedural and therefore advance notice 
and opportunity for comment and delay in effective date are unnecessary 
under the Administrative Procedures Act (4 U.S.C. 553), because OICTS 
is making a technical change in merely updating the designation of 
existing regulations.

IV. Redesignation

    This final rule redesignates all sections of 15 CFR part 7 as 15 
CFR part 791, which will be in the newly created subchapter E of 
chapter VII. All sections in 15 CFR part 7 will be designated under 15 
CFR part 791. Future rulemakings by BIS OICTS will be finalized in 
title 15, subtitle B, chapter VII.

                             Redesignations
------------------------------------------------------------------------
 Old section in 15 CFR, subtitle A, part 7     New section in 15 CFR,
-------------------------------------------   subtitle B, chapter VII,
                                            newly established subchapter
                                                     E, part 791
                  Part 7                   -----------------------------
                                                      Part 791
------------------------------------------------------------------------
Subpart A--General                          Subpart A--General
------------------------------------------------------------------------
7.1.......................................  791.1
7.2.......................................  791.2
7.3.......................................  791.3
7.4.......................................  791.4
7.5.......................................  791.5
7.6.......................................  791.6
7.7.......................................  791.7
------------------------------------------------------------------------
Subpart B--Review of                        Subpart B--Review of
ICTS Transaction                            ICTS Transaction
------------------------------------------------------------------------
7.100.....................................  791.100
7.101.....................................  791.101
7.102.....................................  791.102
7.103.....................................  791.103
7.104.....................................  791.104
7.105.....................................  791.105
7.106.....................................  791.106
7.107.....................................  791.107
7.108.....................................  791.108
7.109.....................................  791.109
7.110.....................................  791.110
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Subpart C--Enforcement                      Subpart C--Enforcement
------------------------------------------------------------------------
7.200.....................................  791.200
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Rulemaking Requirements

    1. This action has not been determined to be significant under 
Executive Order 12866, as it is a technical redesignation that does not 
materially affect the substance of the underlying rule.
    2. Notwithstanding any other provision of law, no person is 
required to respond to, nor shall any person be

[[Page 58265]]

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 action does not impact any information 
collection or recordkeeping requirements under the PRA.
    3. This rule does not contain policies with federalism implications 
as that term is defined in Executive Order 13132.
    4. BIS finds good cause under 5 U.S.C. 553(b)(B) to waive prior 
notice and an opportunity for public comment on this action because 
this action merely re-designates existing regulatory text in the Code 
of Federal Regulations and therefore notice and comment are 
unnecessary. Furthermore, because this action makes no substantive 
changes, it does not constitute a substantive rule, and it is not 
subject to the requirement for a 30-day delay in effective date under 5 
U.S.C. 553(d).
    5. Because a notice of proposed rulemaking and an opportunity for 
public comment are not required to be given for this rule by 5 U.S.C. 
553, or by any other law, the analytical requirements of the Regulatory 
Flexibility Act, 5 U.S.C. 601, et seq., are not applicable. 
Accordingly, no regulatory flexibility analysis is required, and none 
has been prepared.

List of Subjects in 15 CFR Parts 7 and 791

    Administrative practice and procedure, Business and industry, 
Communications, Computer technology, Critical infrastructure, Executive 
orders, Foreign persons, Investigations, National security, Penalties, 
Technology, Telecommunications.

Subtitle A--Office of the Secretary of Commerce

PART 7--SECURING THE INFORMATION AND COMMUNICATIONS TECHNOLOGY AND 
SERVICES SUPPLY CHAIN

0
1. The authority citation for part 7 continues to read as follows:

    Authority: 50 U.S.C. 1701 et seq.; 50 U.S.C. 1601 et seq.; E.O. 
13873, 84 FR 22689; E.O. 14034, 86 FR 31423.

PART 7--[REDESIGNATED AS PART 791]

0
2. Redesignate part 7 as part 791, according to the following table:

------------------------------------------------------------------------
                  Part 7                              Part 791
------------------------------------------------------------------------
Subpart A                                   Subpart A
------------------------------------------------------------------------
Sec.  Sec.   7.1 through 7.7..............  Sec.  Sec.   791.1 through
                                             791.7.
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Subpart B                                   Subpart B
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Sec.  Sec.   7.100 through 7.110..........  Sec.  Sec.   791.100 through
                                             791.110
------------------------------------------------------------------------
Subpart C                                   Subpart C
------------------------------------------------------------------------
Sec.   7.200..............................  Sec.   791.200.
------------------------------------------------------------------------

Sec.  791.102  Confidentiality of information.

0
3. In newly redesignated Sec.  791.102 amend paragraph (c) by removing 
``Sec.  7.109 of this part'' and adding ``Sec.  791.109'' in its place.


Sec.  791.103  Initial review of ICTS Transactions.

0
4. In newly redesignated Sec.  791.103:
0
a. Amend paragraph (a) by removing ``Sec.  7.100(a)'' and adding 
``Sec.  791.100(a)'' in its place;
0
b. Amend paragraph (b) introductory text by removing ``Sec.  7.3(a) of 
this part'' and adding ``Sec.  791.3(a)'' in its place; and
0
c. Amend paragraph (b)(2) by removing ``Sec.  7.100(a)'' and adding 
``Sec.  791.100(a)'' in its place.


Sec.  791.104  First interagency consultation.

0
5. In newly redesignated Sec.  791.104, remove ``Sec.  7.103'' and add 
``Sec.  791.103'' in its place and remove the two instances of ``Sec.  
7.103(c)'' and add ``Sec.  791.103(c)'' in their place.


Sec.  791.105  Initial determination.

0
6. In newly redesignated Sec.  791.105:
0
a. Amend paragraph (a) introductory text by removing ``Sec.  7.104'' 
and adding ``Sec.  791.104'' in its place and removing ``Sec.  
7.103(c)'' and adding ``Sec.  791.103(c)'' in its place;
0
b. Amend paragraph (b) introductory text by removing ``Sec.  7.104'' 
and adding ``Sec.  791.104'' in its place and removing the two 
instances of ``Sec.  7.103(c)'' and adding ``Sec.  791.103(c)'' in 
their place.


Sec.  791.107  Procedures governing response and mitigation.

0
7. In newly redesignated Sec.  791.107:
0
a. Amend the introductory text by removing ``Sec.  7.105'' and adding 
``Sec.  791.105'' in its place;
0
b. Amend paragraph (d) by removing ``Sec.  7.109'' and adding ``Sec.  
791.109'' in its place; and
0
c. Amend paragraph (f) by removing ``section 7.108 of this rule'' and 
adding ``Sec.  791.108'' in its place.


Sec.  791.108  Second interagency consultation.

0
8. In newly redesignated Sec.  791.108:
0
a. Amend paragraph (a) by removing ``Sec.  7.107'' and adding ``Sec.  
791.107'' in its place and removing ``Sec.  7.103(c)'' and adding 
``Sec.  791.103(c)'' in its place;
0
b. Amend paragraph (b) by removing ``Sec.  7.107'' and adding ``Sec.  
791.107'' in its place and by adding ``of this section'' after ``with 
paragraph (a)''; and
0
c. Amend paragraph (d) by removing ``Sec.  7.109'' and adding ``Sec.  
791.109'' in its place.


Sec.  791.109  Final determination.

0
9. In newly redesignated Sec.  791.109, amend paragraph (b) by removing 
``Sec.  7.103'' and adding ``Sec.  791.103'' in its place.

0
10. Under the authority of section 301 of Title 5, United States Code, 
(5 U.S.C. 301) and Chapter 40 of Title 15 of the United States Code (15 
U.S.C. 1501 et seq.), add subchapter E, consisting of parts 790 through 
799, to read as follows:

Subchapter E--Information and Communications Technology and Services 
Regulations

PART 790 [RESERVED]

PART 791--SECURING THE INFORMATION AND COMMUNICATIONS TECHNOLOGY 
AND SERVICES SUPPLY CHAIN.

PARTS 792-799 [RESERVED]

0
11. Transfer part 791 to subchapter E.

Elizabeth Cannon,
Executive Director for the Office of Information and Communications 
Technology and Services.
[FR Doc. 2024-15258 Filed 7-17-24; 8:45 am]
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