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BillingCode:351033P!DEPARTMENTOFCOMMERCEBureauofExportAdministration15CFRparts734,740,742,752,772,and774.[DocketNo.990311067906701񛀛]RIN:0694AB84RemovalofCommercialCommunicationsSatellitesandRelatedItemsfromtheDepartmentofCommercesCommerceControlListforRetransfertotheDepartmentofStatesUnitedStatesMunitionsList.AGENCY:BureauofExportAdministration,CommerceACTION:Finalrule.SUMMARY:TheBureauofExportAdministration(BXA)isamendingtheExportAdministrationRegulations(EAR)byremovingcommercialcommunicationssatellitesandrelateditemsfromtheCommerceControlList(CCL)andretransferringtheseitemstotheUnitedStatesMunitionsList(USML).ThisregulationshallnotapplytoanyexportlicenseissuedbytheDepartmentofCommercebeforeMarch15,1999,ortoanyexportlicenseapplicationfiledundertheExportAdministrationRegulationsonorbeforeMarch14,1999,andsubsequentlyissuedbytheDepartmentofCommerce.DATES:ThisruleiseffectiveMarch15,1999.FORFURTHERINFORMATIONCONTACT:JamesA.Lewis,OfficeofStrategicTradeandForeignPolicyControls,BureauofExportAdministration,Telephone:(202)4824196.SUPPLEMENTARYINFORMATION:BackgroundOnOctober17,1998,thePresidentsignedtheStromThurmondNationalDefenseAuthorizationActforFiscalYear1999(PublicLaw105261),whichrequiresallsatellitesandrelateditemson +8'*B theCommerceControlListoftheEARberetransferredtotheUSMLandcontrolledunderSection38oftheArmsExportControlAct.TheActdefined relateditemstomean, satellitefuel,groundsupportequipment,testequipment,payloadadapterorinterfacehardware,replacementparts,andnon-embeddedsolidpropellantorbittransferengines.ThisretransferreversesPresidentialdecisionsshiftingcommercialcommunicationssatellites(COMSATS)fromthejurisdictionoftheDepartmentofStatetotheDepartmentofCommerce.Further,section1514(a)(3)oftheActmandatesthatintheeventofthefailureofalaunchfromaforeigncountryofasatelliteofUnitedStatesorigin,theactivitiesofUnitedStatespersonsorentitiesinconnectionwithanysubsequentinvestigationofthefailurearesubjecttothecontrolsestablishedundersection38oftheArmsExportControlAct,includingrequirementsforlicensesissuedbytheSecretaryofStateforparticipationinthatinvestigation.InaccordancewiththeFY1999NationalDefenseAuthorizationAct,thisregulationreturnsXXXXXXCOMSATS#XXXXXX #ԀandrelateditemstothejurisdictionoftheDepartmentofState.However,the 0  МiInternationalspacestation,whichiscontrolledunderthesameentryontheCCLasCOMSATS,remainssubjecttothejurisdictionoftheDepartmentofCommerce.ItemsspecifictotheiInternationalspacestationtransferredtotheDepartmentofCommercebycommodityjurisdictionactionandcontrolledunderECCN9A004alsoremainsubjecttoDepartmentofCommercejurisdiction.Allothercommoditiesandsoftwarefor spacecraftpreviouslytransferredbycommodityjurisdictionwillbereviewedinlightofthisrule.BXAwillbecontactingpersonswhohavereceivedcommodityclassificationsthatareaffectedbythischange.Inaddition,entriesontheCCLcontainingitemsthatare spacequalifiedwillbereviewedwithin30daysofthisretransfertodeterminetheappropriatejurisdictionandmayresultinarulechange.TheeffectivedatefortheretransferofjurisdictionofCOMSATSfromtheDepartmentofCommercetotheDepartmentofStateisMarch15,1999.InaccordancewiththeFY1999NationalDefenseAuthorizationAct,thisretransfershallnotaffectanyexportlicenseissuedbeforeMarch15,1999,oranyexportlicenseapplicationfiledundertheExportAdministrationRegulationsonorbeforeMarch14,1999,andsubsequentlyissuedbytheDepartmentofCommerce.COMSATSlicensedbytheDepartmentofCommerce,includingthosealreadyexported,remainsubjecttotheEARandalltermsandconditionsofissuedexportlicensesuntiltheirstatedexpirationdate.AlthoughthisruleeliminatesSIcontrolsforitemslistedinECCN9A004,allDepartmentofCommerceissuedCOMSATlicenses,includinglicensesissuedafterMarch15,1999,remainsubjecttoSIcontrolsthroughoutthevalidityofthelicense.AlthoughtheExportAdministrationAct(EAA)expiredonAugust20,1994,thePresidentinvokedtheInternationalEmergencyEconomicPowersActandcontinuedineffecttheEAR,andtotheextentpermittedbylaw,theprovisionsoftheEAA,asamended,inExecutiveOrder12924ofAugust19,1994,asextendedbythePresident'snoticesofAugust15,1995(60FR42767),August14,1996(61FR42527)August13,1997(62FR43629)andAugust13,1998(63FR44121). ,`'* RuleMakingRequirements  1. ` ThisfinalrulehasbeendeterminedtobesignificantforpurposesofE.O.12866.    2. ` Notwithstandinganyotherprovisionoflaw,nopersonisrequiredtorespondto p norbesubjecttoapenaltyforfailuretocomplywithacollectionofinformationsubjecttotherequirementsofthePaperworkReductionActunlessthatcollectionofinformationdisplaysacurrentvalidOMBControlNumber.ThisregulationinvolvescollectionspreviouslyapprovedbytheOfficeofManagementandBudgetundercontrolnumbers06940088, MultiPurposeApplication,whichcarriesaburdenhourestimateof45minutespermanualsubmissionand40minutesperelectronicsubmission.Inaddition,miscellaneousandrecordkeepingactivitiesaccountfor12minutespersubmission.InFiscalYear1997,therewere12applicationssubmittedforexportsofcommercialcommunicationssatellites.Asaresult,thepaperworkburdenonthepublicisreducedby11hoursonanannualbasis.  3. ` ThisruledoesnotcontainpolicieswithFederalismimplicationssufficientto  warrantpreparationofaFederalismassessmentunderExecutiveOrder12612.  4. ` TheprovisionsoftheAdministrativeProcedureActrequiringnoticeofproposed  rulemaking,theopportunityforpublicparticipation,andadelayineffectivedate,areinapplicablebecausethisregulationinvolvesamilitaryorforeignaffairsfunctionoftheUnitedStates(see5U.S.C.553(a)(1)).Further,nootherlawrequiresthatanoticeofproposedrulemakingandanopportunityforpubliccommentbegivenforthisrule.Becauseanoticeofproposedrulemakingandopportunitiesforpubliccommentarenotrequiredtobegivenforthisruleby5U.S.C.553,orbyanyotherlaw,theanalyticalrequirementsoftheRegulatoryFlexibilityAct,5U.S.C.601etseq.,areinapplicable.  p Therefore,thisregulationisissuedinfinalform.Althoughthereisnoformalcommentperiod,publiccommentsonthisregulationarewelcomeonacontinuingbasis.CommentsshouldbesubmittedtoFrankJ.Ruggiero,OfficeofExporterServices,BureauofExportAdministration,DepartmentofCommerce,P.O.Box273,Washington,D.C.20044.ListofSubjects15CFRpart734  Administrativepracticeandprocedure,Exports,Foreigntrade.15CFRparts740and752  Administrativepracticeandprocedure,Exports,Foreigntrade,Reportingandrecordkeepingrequirements. ,`'* 15CFRparts742,772,and774  Exports,ForeignTrade.  Accordingly,parts734,740,742,752,772,and774oftheExportAdministrationRegulations(15CFRParts730774)areamendedasfollows:  2 e  1  .3  Ԁ ` Theauthoritycitationfor15CFRPart734continuestoreadasfollows: 0    Authority:50U.S.C.app.2401etseq.;50U.S.C.1701etseq.;E.O.12924,3CFR,1994 `  Comp.,p.917;E.O.12938,3CFR,1994Comp.,p.950;E.O.13020,3CFR,1996Comp.p.219;E.O.13026,3CFR,1996Comp.,p.228;NoticeofAugust13,1997,3CFR,1997Comp.,p.306;NoticeofAugust13,1998(63FR44121,August17,1998).  2 e  2  .3   ` Theauthoritycitationfor15CFRPart740continuestoreadasfollows:    Authority:50U.S.C.app.2401etseq.;50U.S.C.1701etseq.;E.O.12924,3CFR,1994  Comp.,p.917;E.O.13020,3CFR,1996Comp.p.219;E.O.13026,3CFR,1996Comp.,p.228;NoticeofAugust13,1997,3CFR,1997Comp.,p.306;NoticeofAugust13,1998(63FR44121,August17,1998).  3. ` Theauthoritycitationfor15CFRPart742continuestoreadasfollows: P   Authority:50U.S.C.app.2401etseq.;50U.S.C.1701etseq.;18U.S.C.2510etseq.;22 0 U.S.C.3201etseq.;42U.S.C.2139a;E.O.12058,43FR20947,3CFR,1978Comp.,p.179;  p E.O.12851,3CFR,1993Comp.,p.608;E.O.12924,59FR43437,3CFR,1994Comp.,p.917;E.O.12938,3CFR,1994Comp.,p.950;E.O.13020,3CFR,1996Comp.p.219;E.O.13026,3CFR,1996Comp.,p.228;NoticeofAugust13,1997,3CFR,1997Comp.,p.306;NoticeofAugust13,1998(63FR44121,August17,1998).  4. ` Theauthoritycitationfor15CFRPart752continuestoreadasfollows: !   Authority:50U.S.C.app.2401etseq.;50U.S.C.1701etseq.;E.O.12924,3CFR,1994 #! Comp.,p.917;E.O.13020,3CFR,1996Comp.p.219;NoticeofAugust13,1997,3CFR,1997Comp.,p.306;NoticeofAugust13,1998(63FR44121,August17,1998).  5. ` Theauthoritycitationfor15CFRPart772continuestoreadasfollows: `'"%   Authority:50U.S.C.app.2401etseq.;50U.S.C.1701etseq.;E.O.12924,3CFR,1994 @)$' Comp.,p.917;E.O.13026,3CFR,1996Comp.,p.228;NoticeofAugust13,1997,3CFR,1997Comp.,p.306;NoticeofAugust13,1998(63FR44121,August17,1998). ,`'*   6. ` Theauthoritycitationsfor15CFRPart774continuestoreadasfollows:    Authority:50U.S.C.app.2401etseq.;50U.S.C.1701etseq.;10U.S.C.7420;10  U.S.C.7430(e);18U.S.C.2510etseq.;22U.S.C.287c;22U.S.C.3201etseq.;22U.S.C.6004;  Sec.201,Pub.L.10458,109Stat.557(30U.S.C.185(s));30U.S.C.185(u);42U.S.C.2139a;42U.S.C.6212;43U.S.C.1354;46U.S.C.app.466c;50U.S.C.app.5;E.O.12924,3CFR,1994Comp.,p.917;E.O.13020,3CFR,1996Comp.p.219;E.O.13026,3CFR,1996Comp.,p.228;NoticeofAugust13,1997,3CFR,1997Comp.,p.306;NoticeofAugust13,1998(63FR44121,August17,1998). PART734[AMENDED]  P    7.Section734.2isamendedbyremovingthesecondsentenceofparagraph(b)(1)andthesecondsentenceofparagraph(b)(4).  8.Section734.4isamendedbyrevisingparagraph(b)toreadasfollows:734.4DeminimisU.S.content.   `    * h *  *  * p * p (b)Thereisnodeminimislevelforthereexportofforeignoriginitemsthatincorporate P  Informationsecuritysystemsandequipment,cryptographicdevices,softwareandcomponentsspecificallydesignedormodifiedtherefor,andrelatedtechnologycontrolledfor EIreasonsunderECCNs5A002,5D002,and5E002.CertainmassmarketencryptionsoftwaremaybecomeeligiblefordeminimisonlyafteraonetimeBXAreview(referto742.15(b)(1)). ` XXXXXX   `    * h *  *  * p *#XXXXXX1# 0  PART740[AMENDED]  !   9.Section740.2isamendedbyrevisingthephrase mannedaircraft,satellites,inparagraph(a)(5)toread mannedaircraft,. PART742[AMENDED]  `'"%   10.Section742.14isrevisedtoreadasfollows: ,`'* 742.14Significantitems:hotsectiontechnologyforthedevelopment,productionoroverhaulofcommercialaircraftengines,components,andsystems.  (a)Licenserequirement.Licensesarerequiredforalldestinations,exceptCanada,for  ECCNshavingan"SI"underthe"ReasonforControl"paragraph.Theseitemsincludehotsectiontechnologyforthedevelopment,productionoroverhaulofcommercialaircraftenginescontrolledunderECCN9E003.a.1.througha.12.,.f,andrelatedcontrols.  (b)Licensingpolicy.Pursuanttosection6oftheExportAdministrationActof1979,as 0  amended,foreignpolicycontrolsapplytotechnologyrequiredforthedevelopment,productionoroverhaulofcommercialaircraftenginescontrolledbyECCN9E003.a.1.througha.12,.f,andrelatedcontrols.Thesecontrolssupplementthenationalsecuritycontrolsthatapplytotheseitems.ApplicationsforexportandreexporttoalldestinationswillbereviewedonacasebycasebasistodeterminewhethertheexportorreexportisconsistentwithU.S.nationalsecurityandforeignpolicyinterests.Thefollowingfactorsareamongthosethatwillbeconsideredtodeterminewhatactionwillbetakenonlicenseapplications:   ` (1)Thecountryofdestination;   ` (2)Theultimateenduser(s);   ` (3)Thetechnologyinvolved;   ` (4)Thespecificnatureoftheenduse(s);and   ` (5)Thetypesofassuranceagainstunauthorizeduseordiversionthataregiveninaparticularcase.  (c)Contractsanctity.Contractsanctityprovisionsarenotavailableforlicense @ applicationsreviewedunderthis742.14.  (d)[Reserved]   `    * h *  *  * p * #!  PART752[AMENDED]  % #   11.Section752.3isamendedbyremovingparagraph(a)(8)andredesignatingparagraphs(a)(9),(a)(10),and(a)(11)asparagraphs(a)(8),(a)(9),and(a)(10).  ,`'* PART772[AMENDED]     12.Part772isamendedbyremovingthedefinitionof exportofsatellites.̀ Part774[AMENDED]  p   12 e  3  .3  ԀInSupplementNo.1topart774,Category9PropulsionSystems,SpaceVehiclesandRelatedEquipmentisamendedbyrevisingECCN9A004: 9A004Spacelaunchvehiclesand spacecraft.  `   LicenseRequirements  @    ReasonforControl:NSandAT   Control(s) `    CountryChart    NSappliestoentireentry  NSColumn1  0   (#(# ATappliestoentireentry  ATColumn1 p  LicenseExceptions  P   LVS: ` N/A  0   GBS: ` N/A  p   CIV: ` N/A `  ListofItemsControlled  @ 0  Unit:Equipmentinnumber.Components,partsandaccessoriesin$value. (#(# 0  RelatedControls:!(#(#   1.)Seealso9A104.  2.)SpacelaunchvehiclesareunderthejurisdictionoftheDepartmentofState.  3.)EffectiveMarch15,1999,allsatellites,includingcommercialcommunicationssatellites,aresubjecttotheITAR.EffectiveMarch15,1999,alllicenseapplicationsfortheexportofcommercialcommunicationssatelliteswillbeprocessedbytheStateDepartment,OfficeofDefenseTradeControls.RetransferofjurisdictionforcommercialcommunicationssatellitesandrelateditemsshallnotaffectthevalidityofanyexportlicenseissuedbytheDepartmentofCommercepriortoMarch15,1999,orofanyexportlicenseapplicationfiledundertheExportAdministrationRegulationsonorbeforeMarch14,1999,andsubsequentlyissuedbytheDepartmentofCommerce.CommercialcommunicationssatelliteslicensedbytheDepartmentofCommerce,includingthosealreadyexported,remainsubjecttotheEARandall ,`'* termsandconditionsofissuedexportlicensesuntiltheirstatedexpirationdate.AlllicensesissuedbytheDepartmentofCommerceforcommercialcommunicationssatellites,includinglicensesissuedafterMarch15,1999,remainsubjecttoSIcontrolsthroughoutthevalidityofthelicense.EffectiveMarch15,1999,DepartmentofStatejurisdictionshallapplytoanyinstancewhereareplacementlicensewouldnormallyberequiredfromtheDepartmentofCommerce.TransferringregistrationoroperationalcontroltoanyforeignpersonofanyitemcontrolledbythisentrymustbeauthorizedonalicenseissuedbytheDepartmentofState,OfficeofDefenseTradeControls.ThisrequirementapplieswhethertheitemisphysicallylocatedintheUnitedStatesorabroad.  0    4.)Allother spacecraftnotcontrolledunder9A004andtheirpayloads,andspecificallydesignedormodifiedcomponents,parts,accessories,attachments,andassociatedequipment,includinggroundsupportequipment,aresubjecttotheexportlicensingauthorityoftheDepartmentofStateunlessotherwisetransferredtotheDepartmentofCommerceviaacommodityjurisdictiondeterminationbytheDepartmentofState.  5.)ExportersrequestingalicensefromtheDepartmentofCommercefor spacecraftandtheirassociatedpartsandcomponents,otherthantheinternationalspacestation,mustprovideastatementfromtheDepartmentofState,OfficeofDefenseTradeControls,verifyingthattheitemintendedforexportisunderthelicensingjurisdictionoftheDepartmentofCommerce.Allspeciallydesignedormodifiedcomponents,parts,accessories,attachments,andassociatedequipmentfor spacecraftthathavebeendeterminedbytheDepartmentofStatethroughthecommodityjurisdictionprocesstobeunderthelicensingjurisdictionoftheDepartmentofCommerceandthatarenotcontrolledbyanyotherECCNontheCommerceControlListwillbeassignedaclassificationunderthisECCN9A004.  6.)Technicaldatarequiredforthedetaileddesign,development,manufacturing,orproductionoftheiInternationalspacestation(toincludespecificallydesignedpartsandcomponents)remainsunderthejurisdictionoftheDepartmentofState.ThiscontrolbytheITARofdetaileddesign,development,manufacturingorproductiontechnologyforNASAsinternationalspacestationdoesnotincludethatleveloftechnicaldatanecessaryandreasonableforassurancethataU.S.builtitemintendedtooperateonNASAsinternationalspacestationhasbeendesigned,manufactured,andtestedinconformancewithspecifiedrequirements(e.g.,operationalperformance,reliability,lifetime,productquality,ordeliveryexpectations).Alltechnicaldataandalldefenseservices,includingalltechnicalassistance,forlaunchoftheinternationalspacestation,includinglaunchvehiclecompatibility,integration,orprocessingdata,arecontrolledandsubjecttothejurisdictionoftheDepartmentofState,inaccordancewith22CFRparts120through130.  Items: p&!$ a.  Theinternationalspacestationbeingdeveloped,launchedandoperatedunderthe P(#& supervisionoftheU.S.NationalAeronauticsandSpaceAdministration.HardwarespecifictotheinternationalspacestationtransferredtotheDepartmentofCommercebycommodityjurisdictionactionisalsoincluded. ,`'* b.  SpecificitemsasmaybedeterminedtobenotsubjecttotheITARthroughthe  commodityjurisdictionprocedureadministeredbytheDepartmentofStateafterMarch15,1999.  Dated:R.RogerMajakAssistantSecretaryforExportAdministration