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(&73 5u{89Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a) 5u{88Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a) 5u{87Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)yz{|}~ 5u{86Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)qrstuvwx 5u{85Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)ijklmnop 5u{84Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)abcdefgh 5u{83Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)YZ[\]^_` 5u{82Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)QRSTUVWX CyParagraph1. a. i. (1) (a) (i) 1) a)I.A.1.a.(1)(a)i)a)IJKLMNOP 5u{81Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)ABCDEFGH 5u{80Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)9:;<=>?@ 5u{79Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)12345678 5u{78Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a))*+,-./0 5u{77Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)!"#$%&'( 5u{76Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a) 5u{75Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a) 5u{74Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)|x<6X9`("Courier 10cpiXx6X@`7X@<6X9`(CourierpiXx6X@`7X@\  `*Times New RomanTTA\  PP($     d D{  D  E {HqG% !     7XXdd7   `     h      p 3(#BillingCodeXXXX:351033P  DEPARTMENTOFCOMMERCEBureauofExportAdministration15CFRparts740and743[DocketNo.980814218821801]RIN:0694AB724ClarificationofReportingRequirementsundertheWassenaarArrangementAGENCY:BureauofExportAdministration,Commerce.ACTION:Interimrulewithrequestforcomments.SUMMARY:OnJanuary15,1998,theBureauofExportAdministration(BXA)publishedaninterimruleimplementingtheWassenaarArrangementlistofdualuseitemsandreportingrequirementsundertheWassenaarArrangement.OnFebruary17,1998,BXApublishedaninterimfinalrulethatconformedthesavingsclausedateforshipmentsofitemsremovedfromeligibilityforexportorreexportunderaparticularLicenseExceptionauthorizationorthedesignatorNLRuntilApril15, n+&6 1998.TheFebruary17ruledidnotaffectthereportingrequirementprovisionsandanyitemremovedfromLicenseExceptionorNLReligibilityasaresultoftheJanuary15rulecontinuestobesubjecttothereportingrequirementsoftheWassenaarArrangement.ThisinterimruleprovidesfurtherclarificationonthesavingsclauseprovisionsandthereportingrequirementsundertheWassenaarArrangement.Specifically,thisruleclarifies:  (1)ThereportingrequirementobligationsofitemsdescribedontheWassenaarArrangementsAnnex1(SensitiveList)andAnnex2(VerySensitiveList)oftheListofDualUseGoodsandTechnologies,includingclarificationonthetimingofthefirstreportinaccordancewiththesavingsclauseprovision;  (2)ThereportingrequirementsforcomputerscontrolledunderExportControlClassificationNumber(ECCN)4A003.b;  (3)ThereportingrequirementproceduresunderLicenseExceptionTSR;and  (4)Thatthereportingrequirementprovisionsdonotapplytoreexports,releaseoftechnologyorsourcecodetoforeign nationalsintheUnitedStates(i.e.,"deemedexports"toforeign *&. nationals),ortoitemsnotcontrolledforNationalSecurity(NS)reasons. Inaddition,thisrulerevisesthecountryscopeforreportingrequirements.DATES:EffectiveDate:ThisruleiseffectiveOctober14,.1998.COMMENTDATE:CommentsonthisrulemustbereceivedonorbeforeDecemberDecember 14,1998 [60DAYSFROMDATEOFPUBLICATION] .ADDRESSES:WrittencommentsshouldbesenttoPatriciaMuldonian,RegulatoryPolicyDivision,BureauofExportAdministration,DepartmentofCommerce,P.O.Box273,Washington,DC20044.FORFURTHERINFORMATIONCONTACT:PatriciaMuldonian,RegulatoryPolicyDivision,BureauofExportAdministration,telephone:(202)4822440.SUPPLEMENTARYINFORMATION:BackgroundOnJanuary15,1998,theBureauofExportAdministration(BXA)publishedaninterimrule(63FR2452)thatmadechangestothe p,'0 CommerceControlListnecessarytoimplementtheWassenaarArrangementListofDualUseGoodsandTechnologies.Inaddition,theJanuary15ruleimposednewreportingrequirementsonpersonsthatexportcertainitemscontrolledundertheWassenaarArrangementtocountriesoutsideofCountryGroupA:1inordertofulfilltheinformationexchangerequirementsoftheWassenaarArrangement.TheJanuary15rulealsoremovedLicenseExceptionavailabilityforcertainitemscontrolledformissiletechnologyreasonsandforcertainotheritemscontrolledfornationalsecurityreasonsforwhichtheU.S.hasagreedtolicensewithextremevigilance.BXAreceivedmanyindustrycommentsonthesavingsclauseprovisiondateofFebruary17,1998,forsubmissionoflicenseapplicationsforitemsremovedfromeligibilityforexportorreexportunderaparticularLicenseExceptionauthorizationorthedesignatorNLR,statingthatmoretimewasrequiredtodeterminehowtheruleaffectedtheirproductsandtodevelopandrevisetheirexportcompliancesoftwarenecessarytoimplementtheprovisionsoftheExportAdministrationRegulations.Inresponsetotheindustryissuesraised,BXApublishedaninterimruleonFebruary17,1998(63FR7699)thatconformedthesavingclausedateforshipmentsofitemsremovedfromeligibilityforexportorreexportunderaparticularLicenseExceptionauthorizationorNLRuntilApril15,1998.TheFebruary17rule p,'0 didnotaffectthereportingrequirementsofsection743.1oftheExportAdministrationRegulations,andanyitemremovedfromLicenseExceptionorNLReligibilityasaresultoftheJanuary15rulecontinuedtobesubjecttoreportingrequirements.ThisruleprovidesfurtherclarificationonthesavingsclauseprovisionoftheFebruary17ruleandonreportingrequirementsundertheWassenaarArrangement. ClarificationofreportingrequirementsofItemsontheWassenaar  Arrangement'sAnnex1andAnnex2  X ReportingobligationsundertheWassenaarArrangementarerequiredforexportsinaccordancewiththeprovisionsof743.1oftheExportAdministrationRegulations(itemsontheWassenaarArrangement'sAnnex1ListofDualUseGoodsandTechnologies(SensitiveList)),effectivefromJanuary15,1998untilApril15,1998,andforthefollowingitemsontheWassenaar !X" Arrangement'sAnnex2ListofDualUseGoodsandTechnologies(VerySensitiveList),inwhichLicenseExceptionsorthedesignatorNLRhavebeenremovedandexportlicenserequirementsimposedinaccordancewiththesavingsclauseprovision.Reports forAnnex2itemsarealsoeffectivefromJanuary15,1998until P)$, April15,1998.AfterApril15,1998,theseitemsrequirealicenseforexportorreexport. LicenseExceptioneligibilityhasbeenremovedandlicensingrequirementsimposedforthefollowingECCNsontheWassenaarArrangement'sAnnex2ListofDualUseGoodsandTechnologies:1A002.a,1C001,1E001,4A003.b,4A003.c,4D001,4E001,5A001.b.9,5D001,5E001.a,6A001.a.2.a.1,6A001.a.2.a.2,6A001.a.2.a.7,6A001.a.2.b,6A001.a.2.c,6A001.a.2.e,6A008.l.3,6B008,6D001,6D003.a,6E001,6E002,8A001.b,8A001.d,8A002.o.3.b,8D001,8E001,and9A001.TheBureauofExportAdministrationwillextractthenecessaryinformationfromlicensestoreporttheseexportstotheArrangement.TheWassenaarreportingrequirementprovisionsdonotapplyto:  (1)Reexports;  (2)AnyreleaseoftechnologyorsourcecodesubjecttotheEARtoaforeignnationalintheUnitedStates;or  (3)ItemscontrolledsolelyforMissileTechnology(MT),NuclearNonproliferation(NP),ChemicalandBiologicalWeapons(CB),orShortSupply(SS)reasons.  ClarificationofLicenseExceptionTSR  *&. ЇBXAreceivedcommentsfromindustryrequestingguidanceonhowtocomplywiththeWassenaarreportingrequirementsforexportsoftechnologyunderLicenseExceptionTSR.Thisruleclarifiesthat,forexportsoftechnologyunderLicenseExceptionTSRforwhichreportsarerequiredunder743.1(c)oftheEAR,exportersshouldreportthenumberofunitsintheshipmentasone(1)fortheinitialexportofthetechnologytoasingleultimateconsignee.Additionalexportsofthetechnologymustbereportedonlywhenthetypeorscopeoftechnologychangesorexportsaremadetootherultimateconsignees.Inaddition,releaseofcontrolledtechnologyorsourcecodetoforeignnationalsintheU.S.,shouldnotbeincludedinthereports. Revisionstothereportingrequirementsforcomputers  8 Inordertoreduceduplicativereportingrequirementsonindustry,thisrulerevises743.1(c)(2)byeliminatingthereportingrequirementforcomputerscontrolledunder4A003.bforexportstodestinationsinComputerTier3.ReportingrequirementsforexportsofsuchcomputerstodestinationsinComputerTier3continuetoberequiredunderthepostshipmentverificationreportingrequirementsof740.7(d)(4)(v)and742.12(b)(3)(iv). *0&.  ClarificationofreportingrequirementforLicenseExceptionGOV    ThisrulecorrectsaninadvertenterrorintheJanuary15ruleforLicenseExceptionGOV.Thisrulerevises740.11(b)(2)(iii)(A)andparagraph(a)toSupplementNo.1to740.11byrevisingthephrase"ItemsforofficialusewithinanationalterritorybyagenciesoftheU.S.Government"toread"Itemsforofficialusewithinanationalterritorybyagenciesofcooperatinggovernments". +'2  AdditionstotheCommerceControlListandclarificationofthe  savingsclauseprovision  @ BXAreceivedcommentsfromindustryrequestingthatBXAclearlydescribethenewentriesthatwereaddedintheJanuary15ruleandexplaintheimpactofthoseentriesinaccordancewiththeFebruary17extensionofthesavingsclauseprovision.Thisruleclarifiesthat,inadditiontothemodificationsinsomeparametersofitemscontrolledontheCommerceControlList,thefollowingnewentrieshavebeenaddedthatcontrolitemspreviously(priortoJanuary15,1998)eligibleforexportorreexportunderthedesignatorNLR.ItemschangedfromNLReligibilitytorequiringalicenseforexportorreexportwereauthorizedforexportorreexportunderthedesignatorNLRinaccordancewiththeFebruary17ruleuntilApril15,1998.AfterApril15,1998,theseitemsrequirealicenseforexportorreexport.However,useofthedesignatorNLRuntilApril15,1998,doesnotrelieveexportersoftheirresponsibilitytoprovidereportsforitemssubjecttothereportingrequirementsundertheWassenaarArrangementretroactivefromJanuary15,1998toApril15,1998.NewECCNsaddedtotheCommerceControlListbytheJanuary15rule:  0*%0 1A005:Bodyarmor,andspeciallydesignedcomponentstherefor, notmanufacturedtomilitarystandardsorspecifications,nottotheirequivalentsinperformance.1C006.d:Certainfluorocarbonelectroniccoolingfluids.1C007.f:Certainceramicceramiccompositematerialswithoxideorglassmatrix.1C009.b:Fluorinatedpolymidescontaining10%byweightormoreofcombinedfluorine.(Notethatthiscontrolisaslightrollback,basedon%byweightofcombinedfluorine.)1C011:Certainmetalsandcompounds.2B007.d:Robotsspeciallydesignedtooperateataltitudesexceeding30,000m.2B009:Certainspinforming/flowformingmachines.5E001.b.10:Developmenttechnologyforspreadspectrumandfrequencyhoppingtechniques.6A001.a.2.e:Certainbottomorbaycablesystems.  0*%0 6A005.a.4.c.1:Carbondioxidelasershavingapulseenergy exceeding5Jperpulse.(Notethatthiscontrolisaslightrollback,because"peakpower"isnolongeracontrollingparameter.)6D003.a.3:Softwareforbottomorbaycablesystems.7D003.e:Computeraideddesignsoftware.7E004.a.5:Technologyforthedevelopmentorproductionofelectricactuatorsspeciallydesignedforprimaryflightcontrol.7E004.a.6:Technologyforthedevelopmentorproductionofflightcontrolopticalsensorarrays.8A002.j.4:Certainstirlingcycleengineairindependentpowersystems.9B004:Intermetallicairfoiltodiskcombinations.Inaddition,thisrulerevisesthecountryscopeforreportsundertheWassenaarArrangement.TheJanuary15rulestatedthatreportingrequirementsapplytoalldestinations,exceptCountryGroupA:1.Thisrulerevises743.1(d),CountryExceptions,to statethatthereportingrequirementsapplytoalldestinations, 0*%0 exceptWassenaarmembercountries,asidentifiedinanewSupplementNo.1topart743. AlthoughtheExportAdministrationAct(EAA)expiredonAugust20,1994,thePresidentinvokedtheInternationalEmergencyEconomicPowersActandcontinuedineffecttheEAR,and,totheextentpermittedbylaw,theprovisionsoftheEAAinExecutiveOrder12924ofAugust19,1994,asextendedbythePresident'snoticesofAugust15,1995(60FR42767),August14,1996(61FR42527),August13,1997(62FR43629),andAugust13,1998(63FR44121).RulemakingRequirements  1.ThisinterimrulehasbeendeterminedtobenotsignificantforpurposesofE.O.12866.  2.Notwithstandinganyotherprovisionoflaw,nopersonisrequiredtorespondto,norshallanypersonbesubjecttoapenaltyforfailuretocomplywithacollectionofinformation,subjecttotherequirementsofthePaperworkReductionAct(PRA),unlessthatcollectionofinformationdisplaysacurrentlyvalidOMBControlNumber.ThisruleinvolvescollectionsofinformationsubjecttothePaperworkReductionActof1995(44 U.S.C.3501etseq.)Thesecollectionshasbeenapprovedbythe 0*%0 OfficeofManagementandBudgetundercontrolnumbers06940088and06940201.   3.ThisruledoesnotcontainpolicieswithFederalismimplicationssufficienttowarrantpreparationofaFederalismassessmentunderExecutiveOrder12612.  4.TheprovisionsoftheAdministrativeProcedureAct(5U.S.C.553)requiringnoticeofproposedrulemaking,theopportunityforpublicparticipation,andadelayineffectivedate,areinapplicablebecausethisregulationinvolvesamilitaryandforeignaffairsfunctionoftheUnitedStates(Sec.5U.S.C.553(a)(1)).Further,nootherlawrequiresthatanoticeofproposedrulemakingandanopportunityforpubliccommentbegivenforthisinterimrule.Becauseanoticeofproposedrulemakingandanopportunityforpubliccommentarenotrequiredtobegivenforthisruleunder5U.S.C.orbyanyotherlaw,theanalyticalrequirementsoftheRegulatoryFlexibilityAct(5U.S.C.601etseq.)arenotapplicable.  $ However,becauseoftheimportanceoftheissuesraisedbytheseregulations,thisruleisissuedininterimformandcommentswillbeconsideredinthedevelopmentoffinalregulations.  (#. Accordingly,theDepartmentencouragesinterestedpersonswhowishtocommenttodosoattheearliestpossibletimetopermitthefullestconsiderationoftheirviews. Theperiodforsubmissionofcommentswillclose Decem   d   ber   December  14,1998 (60DAYSAFTER  @ DATEOFPUBLICATION) .TheDepartmentwillconsiderallcommentsreceivedbeforethecloseofthecommentperiodindevelopingfinalregulations.Commentsreceivedaftertheendofthecommentperiodwillbeconsideredifpossible,buttheirconsiderationcannotbeassured.TheDepartmentwillnotacceptpubliccommentsaccompaniedbyarequestthatapartorallofthematerialbetreatedconfidentiallybecauseofitsbusinessproprietarynatureorforanyotherreason.TheDepartmentwillreturnsuchcommentsandmaterialstothepersonsubmittingthecommentsandwillnotconsidertheminthedevelopmentoffinalregulations.Allpubliccommentsontheseregulationswillbeamatterofpublicrecordandwillbeavailableforpublicinspectionandcopying.Intheinterestofaccuracyandcompleteness,theDepartmentrequirescommentsinwrittenform.Oralcommentsmustbefollowedbywrittenmemoranda,whichwillalsobeamatterofpublicrecordandwillbeavailableforpublicreviewandcopying.CommunicationsfromagenciesoftheUnitedStatesGovernmentorforeigngovernmentswillnotbemadeavailableforpublicinspection. +'2 ThepublicrecordconcerningtheseregulationswillbemaintainedintheBureauofExportAdministrationFreedomofInformationRecordsInspectionFacility,Room4525,DepartmentofCommerce,14thStreetandPennsylvaniaAvenue,N.W.,Washington,D.C.20230.Recordsinthisfacility,includingwrittenpubliccommentsandmemorandasummarizingthesubstanceoforalcommunications,maybeinspectedandcopiedinaccordancewithregulationspublishedinPart4ofTitle15oftheCodeofFederalRegulations.InformationabouttheinspectionandcopyingofrecordsatthefacilitymaybeobtainedfromMargaretCornejo,BureauofExportAdministrationFreedomofInformationOfficer,attheaboveaddressorbycalling(202)4825653.ListofSubjects15CFRparts740and743  Administrativepracticeandprocedure,Exports,Foreigntrade,Reportingandrecordkeepingrequirements.   @"   Accordingly,parts740and743oftheExportAdministrationRegulations(15CFRparts730through799)areamendedasfollows:  1.Theauthoritycitationforpart740isrevisedtoreadasfollows: +'2   Authority:50U.S.C.app.2401etseq.;50U.S.C.1701et  seq.;E.O.12924,59FR43437,3CFR,1994Comp.,p.917;Notice @ ofAugust15,1995,3CFR,1995Comp.,p.501;NoticeofAugust14,1996,3CFR,1996Comp.,p.289;NoticeofAugust13,1997(62FR43629,August15,1997);andNoticeofAugust13,1998(63FR44121).  2.Theauthoritycitationforpart743isrevisedtoreadasfollows:  Authority:50U.S.C.app.2401etseq.;50U.S.C.1701et P seq.;E.O.12924,59FR43437,3CFR,1994Comp.,p.917;Notice 0 ofAugust15,1995,3CFR,1995Comp.,p.501;NoticeofAugust14,1996,3CFR,1996Comp.,p.289;NoticeofAugust13,1997(62FR43629,August15,1997);andNoticeofAugust13,1998(63FR44121).PART740[AMENDED]  3.Section740.6isamendedbyrevisingparagraph(b)toreadasfollows:740.6Technologyandsoftwareunderrestriction(TSR).@***** +'2 (b)Reportingrequirements.See743.1oftheEARforreporting  requirementsforexportsofcertainitemsunderLicenseExceptionTSR.NotethatreportsarenotrequiredforreleaseoftechnologyorsourcecodesubjecttotheEARtoforeignnationalsintheU.S.undertheprovisionsofLicenseExceptionTSR...4.Section740.11isamended:..` ..` a.Byrevisingtheheadingofparagraph(b)(2)(iii)(A);and..` ..` b.Byrevisingthefirstsentenceofparagraph(a)inSupplementNo.1,toreadasfollows:740.11Governmentsandinternationalorganizations(GOV).@..*****(b)***..(2)***..` ..` (iii)***..` ..`  .. (A)Itemsforofficialusewithinnationalterritorybyagenciesofcooperatinggovernments.@..*****SupplementNo.1to740.11AdditionalRestrictionsonUseofLicenseExceptionGOV@..*****(a)Itemsforofficialusewithinthenationalterritorybyagenciesofcooperatinggovernments.***@.. *****PART743[AMENDED]..5.Section743.1isamended:..` ..` a.Byrevisingparagraph(b);..` ..` b.Byaddinganoteimmediatelyfollowingparagraph(c)(2);..` ..` c.Byrevisingparagraph(d);and..` ..` d.Byaddinganoteimmediatelyfollowingparagraph(e)(1)(ii),toreadasfollows:743.1WassenaarArrangement.@.. *****(b)Requirements.Youmustsubmittwo(2)copiesofeachreportrequiredundertheprovisionsofthissectionandmaintainaccuratesupportingrecords(see762.2(b)oftheEAR)forallexportsofitemsspecifiedinparagraph(c)ofthissectionunderanyofthefollowingLicenseExceptionsauthorizedbypart740oftheEAR:LicenseExceptionsGBS,CIV,TSR,LVS,CTP,GOVandKMI(undertheprovisionsof740.8(b)(2)(ii)and(iii)only).ExportsoftechnologyandsourcecodeunderLicenseExceptionTSRtoforeignnationalsintheU.S.shouldnotbereported.Forpurposesofthispart743,"you"hasthesamemeaningas"U.S.exporter",asdefinedinpart772oftheEAR.(c)***..(2)***..` ..` Notetoparagraph(c)(2):Exportsofcomputerscontrolledunder4A003.btodestinationsinComputerTier3(see740.7(d)(1)oftheEAR)shouldnotbeincludedinthereportsrequiredunderparagraph(c)ofthissection.Reportingforcomputersunder4A003.btoComputerTier3destinationsshouldbereportedunderthepostshipmentverificationreportingprovisionsof740.7(d)(4)(v)orunder742.12(b)(3)(iv)oftheEAR.(d)CountryExceptions.Youmustreporteachexportsubjecttotheprovisionsofthissection,exceptforexportstoWassenaarmembercountries,asidentifiedinSupplementNo.1topart743.(e)***..(1)***..` ..` (ii)***..` ..`  .. Notetoparagraph(e)(1)(ii):Forexportsoftechnologyforwhichreportsarerequiredunder743.1(c)ofthissection,thenumberofunitsintheshipmentshouldbereportedasone(1)fortheinitialexportofthetechnologytoasingleultimateconsignee.Additionalexportsofthetechnologymustbereportedonlywhenthetypeorscopeoftechnologychangesorexportsaremadetootherultimateconsignees.Additionally,donotreportthereleaseoftechnologyorsourcecodesubjecttotheEARtoforeignnationalsintheU.S.@..*****6.Part743isamendedbyaddinganewSupplementNo.1toreadasfollows:SUPPLEMENTNO.1TOPART743WASSENAARARRANGEMENTMEMBERCOUNTRIESArgentinaAustraliaAustriaBelgiumBulgariaCanadaCzechRepublicDenmarkFinlandFranceGermanyGreeceHungaryIrelandItalyJapanLuxembourgNetherlandsNewZealandNorwayPolandPortugalRomaniaRussiaSlovakiaSouthKoreaSpainSwedenSwitzerlandTurkeyUkraineUnitedKingdomUnitedStatesDated:R.RogerMajakAssistantSecretaryforExportAdministration