BIS Issues Long-Awaited China Military "Catch-All" Proposed Rule
The Commerce Department's Bureau of Industry and Security will publish in tomorrow's Federal Register the long-awaited proposed China military "catch-all" regulation.
As expected, the proposed rule provides that 47 categories of items included in the Commerce Control List (CCL) may not be exported to China without a license or license exception GOV if the exporter has "knowledge that the item is intended, entirely or in part, for a 'military end-use' as defined in [the regulation], in the PRC" or the exporter has been "informed by BIS that the item is or may be intended, entirely or in part, for a 'military end-use' in the PRC."
Licenses to export items controlled for export to China will be reviewed by BIS on a "case-by-case basis to determine whether the export, reexport, or transfer would make a material contribution to the military capabilities of the PRC and would result in advancing the country's military activities contrary to the national security interests of the United States."
Most of the items that would be affected by the proposed change in licensing policy are currently controlled for anti-terrorism reasons under the Export Administration Regulations (EAR). Among other things, the list of items that would be subject to licensing requirements to be exported for a military end-use in China includes equipment specially designed for the production of structural composites (ECCN 1B999.e); certain composite fibers (ECCN 1C990); certain high performance machine tools (ECCN 2B991 and 2B992); electronic manufacturing and inspection equipment (ECCNs 3B991 and 3B992) telecommunications test equipment (ECCN 5B991); aircraft parts and components and related software and technologies (ECCNs 9A991, 9D991, 9E991 ).
In addition, the proposed rule would create a new authorization for civilian validated end-users (VEU) to whom certain items may be exported without a license. The list of validated end-users would be published in a new supplement to the EAR.
The proposed rule would also greatly expand the current End-User Certificate requirements for China by requiring exporters to obtain End-User Certificates from China's Ministry of Commerce for all exports of controlled goods and technologies over $5,000 per single ECCN entry. End-User Certificates would not have to be submitted to BIS, but the serial number of the End-User Certificate would have to be included in the license application.
Public comments on the proposed changes to the EAR set forth in the proposed rule must be submitted to BIS by November 3, 2006.
Update: The proposed catch-all rule can be found at the following link:
http://a257.g.akamaitech.net/7/257/2422/01jan20061800/edocket.access.gpo.gov/2006/E6-10504.htm
Labels: BIS, Export Controls
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