January 28, 1999

Billing Code: 3510-33-P

DEPARTMENT OF COMMERCE

Bureau of Export Administration

15 CFR parts 772 and 774

RIN: 0694-AB75

[Docket No. 990112008-9008-01]

Revisions to the Commerce Control List: Changes in Missile Technology Controls

AGENCY: Bureau of Export Administration, Commerce

ACTION: Interim rule with request for comments.

SUMMARY: The Bureau of Export Administration (BXA) maintains the Commerce Control List (CCL), which identifies those items subject to Department of Commerce export controls. This interim rule amends the CCL by revising a number of items subject to control for missile technology reasons. These changes to the CCL are the result of the decisions taken by the Missile Technology Control Regime (MTCR), in November 1997.

The changes made by this rule are intended to conform the list of missile technology related items controlled by the United States to the list agreed and adopted by the countries participating in the MTCR.

Although the Export Administration Act (EAA) expired on August 20, 1994, the President invoked the International Emergency Economic Powers Act and continued in effect the EAR, and to the extent permitted by law, the provisions of the EAA, as amended, in Executive Order 12924 of August 19, 1994, as extended by the President's notices of August 17, 1995 (60 FR 42767), August 14, 1996 (61 FR 42527), August 13, 1997 (62 FR 43629), and August 13, 1998 (63 FR 44121).

DATES: This rule is effective February 8, 1999. Comments must be received by April 9, 1999.

ADDRESSES: Written comments (six copies) should be sent to Patricia Muldonian, Regulatory Policy Division, Bureau of Export Administration, Department of Commerce, P.O. Box 273, Washington, DC 20044.

FOR FURTHER INFORMATION CONTACT: Vince Chin, Office of Nuclear and Missile Technology Controls, Bureau of Export Administration, Telephone: (202) 482-0998.

SUPPLEMENTARY INFORMATION:

Background

At the November, 1997, meeting of the Missile Technology Control Regime (MTCR), the member countries made certain technical revisions in the MTCR's missile technology list. The changes agreed at the November, 1997 meeting have been adopted by the member countries and are contained in this interim rule. Many of the changes redefine the scope of the technical parameters describing missile technology items controlled for export or reexport.

Specifically, this rule makes the following revisions:

(1) Clarifies controls on metal powder production equipment and also includes certain plasma generators and electroburst equipment usable for making spherical metallic powder. These revisions are described in a new entry (ECCN 1B117), which also includes mixers and fluid energy mills previously controlled under ECCN 1B115. ECCN 1B115 will now control liquid propellant production equipment only. All solid propellant production equipment have been consolidated into the new entry (ECCN 1B117).

(2) Clarifies the control text for metal powder described under ECCN 1C111.

(3) Adds a new control for Titanium-stabilized duplex stainless steel (ECCN 1C118). This control has been added to prevent the proliferation of these materials to missile projects of concern.

(4) Broadens controls on certain test, calibration and alignment equipment described in Category 7B for gyroscopes, accelerometers, inertial and navigation equipment described in Category 7A, by replacing the term "specially designed" with the term "designed or modified" as the equipment modifier and by further defining some specific types of equipment to be controlled. These specific types of equipment include certain balancing machines, indicator heads, motion simulators, positioning/rate tables and centrifuges that are specified in a new entry (ECCN 7B104). In addition, ECCN 7B101 was added to control other production equipment not specified in ECCN 7B104 that are "designed or modified" to be used with certain equipment described in Category 7A.

Savings Clause

This rule revises the numbering and structure of certain entries on the Commerce Control List. For items under such entries, BXA will accept either the entries described before February 8, 1999 or the entries described by this rule until May 10, 1999. In addition, this rule imposes new controls on certain items. Shipments of items removed from eligibility under a particular License Exception authorization or the designator NLR, may continue to be exported or reexported under that License Exception authorization or designator until May 10, 1999, except for shipments of such items to the People's Republic of China. In light of recently enacted Presidential certification requirements involving the export to the People's Republic of China of items controlled for missile technology reasons, contained in section 1512 of the Strom Thurmond Defense Authorization Act for Fiscal Year 1999 (P.L. 105-261), shipments of such items to the People's Republic of China are subject to the licensing requirements of the regulation as of the effective date of publication.

Rulemaking Requirements

1. This final rule has been determined to be not significant for the purposes of Executive Order 12866.

2.	Not withstanding any other provision of law, no person is required to respond to nor be subject to a penalty for failure to comply with a collection of information subject to the requirements of the Paperwork Reduction Act unless that collection of information displays a current valid OMB Control Number. This rule involves a collection of information subject to the Paperwork Reduction Act of 1980 (44 U.S.C. 3501 et seq.). This collection has been approved by the Office of Management and Budget under control number 0694-0088.

3.	This rule does not contain policies with Federalism implications sufficient to warrant preparation of a Federalism assessment under Executive Order 12612.

4.	Because a notice of proposed rulemaking and an opportunity for public comment are not required to be given for this rule by the Administrative Procedure Act (5 U.S.C. 553) or by any other law, under section 3(a) of the Regulatory Flexibility Act (5 U.S.C. 603(a) and 604(a)) no initial or final Regulatory Flexibility Analysis has to be or will be prepared.

5.	The provisions of the Administrative Procedure Act,

(5 U.S.C. 553), requiring notice of proposed rulemaking, the opportunity for public participation, and a delay in effective date, are inapplicable because this regulation involves a military or foreign affairs function of the United States (Sec. 5 U.S.C. 553(a)(1). Further, no other law requires that a notice of proposed rulemaking and an opportunity for public comment be given for this interim rule. Because a notice of proposed rulemaking and an opportunity for public comment are not required to be given for this rule under 5 U.S.C. or by any other law, the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) are not applicable.

However, because of the importance of the issues raised by these regulations, this rule is issued in interim form and comments will be considered in the development of final regulations.

Accordingly, the Department encourages interested persons who wish to comment to do so at the earliest possible time to permit the fullest consideration of their views.

The period for submission of comments will close April 9, 1999. The Department will consider all comments received before the close of the comment period in developing final regulations. Comments received after the end of the comment period will be considered if possible, but their consideration cannot be assured. The Department will not accept public comments accompanied by a request that a part or all of the material be treated confidentially because of its business proprietary nature or for any other reason. The Department will return such comments and materials to the person submitting the comments and will not consider them in the development of final regulations. All public comments on these regulations will be a matter of public record and will be available for public inspection and copying. In the interest of accuracy and completeness, the Department requires comments in written form.

Oral comments must be followed by written memoranda, which will also be a matter of public record and will be available for public review and copying.

The public record concerning these regulations will be maintained in the Bureau of Export Administration Freedom of Information Records Inspection Facility, Room 4525, Department of Commerce, 14th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20230. Records in this facility, including written public comments and memoranda summarizing the substance of oral communications, may be inspected and copied in accordance with regulations published in Part 4 of Title 15 of the Code of Federal Regulations. Information about the inspection and copying of records at the facility may be obtained from Henry Gaston, Bureau of Export Administration Freedom of Information Officer, at the above address or by calling (202) 482- 0500.

List of Subjects

15 CFR Parts 772 and 774

Exports, Foreign Trade.

Accordingly, Parts 772 and 774 of the Export Administration Regulations (15 CFR Parts 730-799) are amended as follows:

1. The authority citation for 15 CFR Part 774 is revised to read as follows:

Authority: 50 U.S.C. app. 2401 et seq., 1701 et seq., app. 5; 10 U.S.C. 7420, 7430(e); 18 U.S.C. 2510 et seq.; 22 U.S.C. 287c, 3201 et seq., 6004; Sec. 201, Pub. L. 104-58, 109 Stat. 557 (30 U.S.C. 185(s), 185(u)); 42 U.S.C. 2139a, 6212; 43 U.S.C. 1354; 46 U.S.C. app. 466c; E.O. 12924, 3 CFR, 1994 Comp., p. 917; E.O. 13026, 3 CFR, 1996 Comp., p. 228; Notice of August 13, 1998 (63 FR 44121, August 17, 1998).

2.	The authority citation for 15 CFR part 772 is revised to read as follows:

Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; E.O. 12924, 59 FR 43437, 3 CFR, 1994 Comp., p. 917; E.O. 12938, 3 CFR, 1994 Comp., p. 950; E.O. 13026, 3 CFR, 1996 Comp., p. 228; Notice of August 13, 1997 (62 FR 43629, August 15, 1997); Notice of August 13, 1998 (63 FR 44121, August 17, 1998).

PART 772 - [AMENDED]

3. Part 772 is amended by revising the definition for "production" and by adding a definition for "production equipment" to read as follows:

PART 772 - DEFINITION OF TERMS

* * * * *

"Production". (General Technology Note) (Cat. 1 and 7)-- Means all production stages, such as: product engineering, manufacture, integration, assembly (mounting), inspection, testing, quality assurance.

"Production equipment". (MTCR context) -- Tooling, templates, jigs, mandrels, moulds, dies, fixtures, alignment mechanisms, test equipment, other machinery and components therefor, limited to those specially designed or modified for "development" or for one or more phases of "production".

* * * * *

PART 774 - [AMENDED]

Supplement No. 1 to part 774 - the Commerce Control List - [AMENDED]

4. In Supplement No. 1 to part 774 (the Commerce Control List), Category 1 - Materials, Chemicals, "Microorganisms", and Toxins, the following Export Control Classification Numbers (ECCNs) are amended:

a. By revising the entry heading and the List of Items Controls section for ECCN 1B115;

b. By adding ECCN 1B117;

c. By revising the List of Items Controlled section for ECCN 1C111;

d. By adding ECCN 1C118;

e. By revising the Reason for Control section for 1E001; and

f. By revising the entry heading for ECCN 1E101; to read as follows:

1B115 "Production equipment" for the production, handling or acceptance testing of liquid propellants or propellant constituents controlled by 1C011, 1C111 or on the U.S. Munitions List, and specially designed components therefor.

* * * * *

List of Items Controlled

Unit: Equipment in number; components in $ value

Related Controls: 1.) For equipment specially designed for the production of military propellants or propellant constituents, see the U.S. Munitions List. 2.) Items when specifically designed, developed, configured, adapted or modified to produce an item on the USML are subject to the export licensing authority of the U.S. State Department, Office of Defense Trade Controls (see 22 CFR Part 121.).

Related Definitions: N/A

Items:

The list of items controlled is contained in the ECCN heading.

1B117 "Production equipment", as follows (see List of Items Controlled), for the production, handling or acceptance testing of solid propellants or propellant constituents controlled by 1C011, 1C111 or on the U.S. Munitions List.

License Requirements

Reason for Control: MT, AT

Control(s)	Country Chart

MT applies to entire entry	MT Column 1

AT applies to entire entry	AT Column 1

License Exceptions

LVS: N/A

GBS: N/A

CIV: N/A

List of Items Controlled

Unit: Equipment in number; components in $ value

Related Controls: 1.) See also 1B115. 2.) For equipment specially designed for the production of military propellants or propellant constituents, see the U.S. Munitions List. 3.) This entry does not control equipment for the "production", handling and acceptance testing of boron carbide. 4.) Items when specifically designed, developed, configured, adapted or modified to produce an item on the USML are subject to the export licensing authority of the U.S. State Department, Office of Defense Trade Controls (see 22 CFR Part 121.).

Related Definitions: 1.) The only batch mixers, continuous mixers, and fluid energy mills controlled in 1B117, are those controlled in 1B117.a through d. 2.) Forms of metal powder "production equipment" not specified in 1B117.d. are to be evaluated in accordance with 1B117.e.

Items:

a. Batch mixers with provision for mixing under vacuum in the range from zero to 13.326 kPa, and with temperature control capability of the mixing chamber and having:

a.1. A total volumetric capacity of 110 liters (30 gallons) or more; and

a.2 At least one mixing/kneading shaft mounted off center;

b. Continuous mixers with provision for mixing under vacuum in the range from zero to 13.326 kPa, and with temperature control capability of the mixing chamber and having:

b.1. Two or more mixing/kneading shafts; and

b.2. Capability to open the mixing chamber.

c. Fluid energy mills usable for grinding or milling propellant or propellant constituents specified in 1C011 or 1C111, or on the U.S. Munitions List.

d. Metal powder "production equipment" usable for the "production", in a controlled environment, of spherical or atomized materials specified in 1C011 or 1C111 a.1. or a.2., or on the U.S. Munitions List including:

d.1. Plasma generators (high frequency arc-jet) usable for obtaining sputtered or spherical metallic powders with organization of the process in an argon-water environment;

d.2. Electroburst equipment usable for obtaining sputtered or spherical metallic powders with organization of the process in an argon-water environment;

d.3. Equipment usable for the "production" of spherical aluminium powders by powdering a melt in an inert medium (e.g. nitrogen).

e.	"Production equipment" for the production, handling, mixing, curing, casting, pressing, machining, extruding or acceptance testing of solid propellants or propellant constituents described in 1C011 or 1C111, or on the U.S. Munitions List, other than those described in 1B117.a through d.

f.	Specially designed components for the equipment controlled in 1B117.a through e.

1C111 Propellants and constituent chemicals for propellants, other than those controlled by 1C011, as follows (see List of Items Controlled).

* * * * *

List of Items Controlled

Unit: Kilograms

Related Controls: 1.) The following materials, whether or not encapsulated in aluminum, beryllium, magnesium, or zirconium are subject to the export licensing authority of the U.S. Department of State, Office of Defense Trade Controls: (See 22 CFR part 121): a.) Spherical aluminum powder with particles of uniform diameter 60 x 10-6 m (60 micrometers) or less and an aluminum content of 99 percent or greater; b.) Zirconium, beryllium, boron, magnesium and alloys of these, in particle sizes of less than 60 x 10-6 m (60 micrometers), whether spherical, atomized, spheroidal, flaked or ground, consisting 99% or more by weight of any of the above mentioned metals; or c.) iron powder with average particle size of 3 x 10-6 m (3 microns) or less produced by hydrogen reduction of iron oxide. 2.) For propellants and constituent chemicals for propellants not controlled by 1C111, see the U.S. Munitions List.

Related Definitions: N/A

Items

a. Propulsive substances:

a.1. Spherical aluminum powder, other than that specified on the U.S. Munitions List, with particles of uniform diameter of less than 500 micrometer and an aluminum content of 97% by weight or greater;

a.2. Zirconium, beryllium, boron, magnesium and alloys of these, other than that controlled by the U.S. Munitions List, in particle sizes of less than 500 x 10-6 m (500 micrometers), whether spherical, atomized, spheroidal, flaked or ground, consisting 97% or more by weight of any of the above mentioned metals.

a.3. Liquid oxidizers, as follows:

a.3.a. Dinitrogen trioxide;

a.3.b. Nitrogen dioxide/dinitrogen tetroxide;

a.3.c. Dinitrogen pentoxide;

b. Polymeric substances:

b.1. Carboxy-terminated polybutadiene (CTPB);

b.2. Hydroxy-terminated polybutadiene (HTPB), other than that controlled by the U.S. Munitions List;

b.3. Polybutadiene-acrylic acid (PBAA);

b.4. Polybutadiene-acrylic acid-acrylonitrile (PBAN);

c. Other propellant additives and agents:

c.1. Butacene;

c.2. Triethylene glycol dinitrate (TEGDN);

c.3. 2-Nitrodiphenylamine;

c.4. Trimethylolethane trinitrate (TMETN);

c.5. Diethylene glycol dinitrate (DEGDN).

1C118 Titanium-stabilized duplex stainless steel (Ti-DSS):

License Requirements:

Reason for Control: MT, AT

Control(s)	Country Chart

MT applies to entire entry	MT Column 1

AT applies to entire entry	AT Column 1

License Exceptions:

LVS: N/A

GBS: N/A

CIV: N/A

List of Items Controlled:

Unit: Kilograms

Related Controls: N/A

Related Definitions: N/A

Items:

a.	Titanium-stabilized duplex stainless steel (Ti-DSS) having:

a.1. All of the following characteristics:

a.1.a. Containing 17.0-23.0 weight percent chromium and 4.5-7.0 weight percent nickel, and

a.1.b. A ferritic-austenitic microstructure (also referred to as a two-phase microstructure) of which at least 10 percent is austenite by volume (according to ASTM E-1181- 87 or national equivalents), and

a.2. Any of the following forms:

a.2.a. Ingots or bars having a size of 100 mm or more in each dimension;

a.2.b. Sheets having a width of 600 mm or more and a thickness of 3 mm or less; or

a.2.c. Tubes having an outer diameter of 600 mm or more and a wall thickness of 3 mm or less.

1E001 "Technology" according to the General Technology Note for the "development" or "production" of items controlled by 1A001.b, 1A001.c, 1A002, 1A003, 1A004, 1A005, 1A102, 1B or 1C (except 1C980 to 1C984, 1C988, 1C990, 1C991, 1C992, 1C994 and 1C995).

License Requirements

Reason for Control: NS, MT, NP, CB, AT

Control(s)	Country Chart

NS applies to "technology"	NS Column 1

for items controlled by

1A001.b and .c, 1A002,

1A003, 1B001 to 1B003, 1B018,

1B225, 1C001 to 1C010, 1C018,

1C230, 1C231, 1C233, or 1C234

MT applies to "technology"	MT Column 1

for items controlled by

1B001, 1B101, 1B115, 1B116, 1B117,

1C001, 1C007, 1C101, 1C107, 1C011,

1C111, 1C116, 1C117, or 1C118 for MT

reasons

NP applies to "technology"	NP Column 1

for items controlled by

1A002, 1B001, 1B101, 1B201,

1B225 to 1B232, 1C001,

1C010, 1C202, 1C210, 1C216,

1C225 to 1C234, 1C236

to 1C238 for NP reasons

CB applies to "technology"	CB Column 1

for items controlled by

1C351, 1C352, 1C353, or

1C354

CB applies to "technology"	CB Column 2

for materials controlled

by 1C350

AT applies to entire entry	AT Column 1

1E101 "Technology" according to the General Technology Note for the "use" of goods controlled by 1A102, 1B001, 1B101, 1B115, 1B116, 1B117, 1C001, 1C007, 1C011, 1C101, 1C107, 1C111, 1C116, 1C117, 1C118, 1D101 or 1D103.

* * * * *

5. In Supplement No. 1 to part 774 (the Commerce Control List), Category 7 - Navigation and Avionics, the following Export Control Classification Numbers (ECCNs) are amended:

a. By revising the List of Items Controlled section for ECCN 7B003;

b. By adding ECCN 7B101;

c. By revising the entry heading and List of Items Controlled section for ECCN 7B102;

d. By adding ECCN 7B104;

e. By revising the entry heading for ECCN 7D101; and

f. By revising the entry heading for ECCN 7E101, to read as follows:

7B003 Equipment specially designed for the "production" of equipment controlled by 7A (except 7A994).

* * * * *

List of Items Controlled

Unit: $ value

Related Controls: 1.) See also 7B103, (this entry is subject to the licensing authority of the U.S. Department of State, Office of Defense Trade Controls (see 22 CFR part 121) 7B101 and 7B994. 2.) This entry includes: inertial measurement unit tester (IMU module); IMU platform tester; IMU stable element handling fixture; IMU platform balance fixture; gyro tuning test station; gyro dynamic balance station; gyro run-in/motor test station; gyro evacuation and filling station; centrifuge fixtures for gyro bearings; accelerometer axis align station; and accelerometer test station.

Related Definitions: N/A

Items:

The list of items controlled is contained in the ECCN heading.

7B101 "Production equipment", and other test, calibration, and alignment equipment, other than that described in 7B003, 7B102 and 7B104, designed or modified to be used with equipment controlled by 7A001-7A004 or 7A101-7A104.

License Requirements

Reason for Control: MT, AT

Control(s)	Country Chart

MT applies to entire entry	MT Column 1

AT applies to entire entry	AT Column 1

License Exceptions

LVS: N/A

GBS: N/A

CIV: N/A

List of Items Controlled

Unit: $ value

Related Controls: 1.) See also 7B003, 7B102, 7B104 and 7B994. 2.) This entry includes: inertial measurement unit tester (IMU module); IMU platform tester; IMU stable element handling fixture; IMU platform balance fixture; gyro tuning test station; gyro dynamic balance station; gyro run-in/motor test station; gyro evacuation and filling station; centrifuge fixtures for gyro bearings; accelerometer axis align station; and accelerometer test station.

Related Definitions: N/A

Items:

The list of items controlled is contained in the ECCN heading.

7B102 Equipment, other than those controlled by 7B002, designed or modified to characterize mirrors, for laser gyro equipment, as follows (see List of Items Controlled).

* * * * *

List of Items Controlled

Unit: $ value

Related Controls: N/A

Related Definitions: N/A

Items:

a. Scatterometers having a measurement accuracy of 10 ppm or less (better).

b. Reflectometers having a measurement accuracy of 50 ppm or less (better).

c. Profilometers having a measurement accuracy of 0.5nm (5 Angstroms) or less (better).

7B104 Equipment, designed or modified to be used with equipment controlled by 7A001-
7A004, or 7A101 - 7A104, as follows (see List of Items Controlled).

License Requirements:

Reason for Control: MT, AT

Control(s)	Country Chart

MT applies to entire entry	MT Column 1

AT applies to entire entry	AT Column 1

License Exceptions:

LVS:	N/A

GBS:	N/A

CIV:	N/A

List of Items Controlled:

Unit: $ value

Related Controls: 1) See also 7B101 and 7B994.

Related Definitions: 1.) 7B104.a. does not control balancing machines designed or modified for dental or other medical equipment. 2.) 7B104.c. and 7B104.d. do not control rotary tables designed or modified for machine tools or for medical equipment. 3.) Rate tables not controlled by 7B104.c. and providing the characteristics of a positioning table are to be evaluated according to 7B104.d. 4.) Equipment that has the characteristics specified in 7B104.d. which also meets the characteristics of 7B104.c. will be treated as equipment specified in 7B104.c.

Items:

a. Balancing machines having all the following characteristics:

a.1. Not capable of balancing rotors/assemblies having a mass greater than 3 Kgm;

a.2. Capable of balancing rotors/assemblies at speeds greater than 12,500 rpm;

a.3. Capable of correcting unbalance in two planes or more; and

a.4. Capable of balancing to a residual specific unbalance of 0.2 gram-mm per kg of rotor mass;

b. Indicator heads (sometimes known as balancing instrumentation) designed or modified for use with machines specified in 7B104.a.

c. Motion simulators/rate tables (equipment capable of simulating motion) having all of the following characteristics:

c.1. Two axes or more;

c.2. Slip rings capable of transmitting electrical power and/or signal information; and

c.3. Having any of the following characteristics:

c.3.a. For any single axis:

c.3.a.1. Capable of rates of rotation of 400 degrees/sec or more, or 30 degrees/sec or less, and

c.3.a.2. A rate resolution equal to or less than 6 degrees/sec and an accuracy equal to or less than 0.6 degrees/sec; or

c.3.b. Having a worst case rate stability equal to or better (less) than plus or minus 0.05% averaged over 10 degrees or more; or

c.3.c. A positioning accuracy equal to or better than 5 arc-second.

d. Positioning tables (equipment capable of precise rotary position in any axis) having the following characteristics:

d.1. Two axes or more; and

d.2. A positioning accuracy equal to or better than 5 arc-second;

e. Centrifuges able to impart accelerations above 100 g and having slip rings capable of transmitting electrical power and signal information.

7D101 "Software" specially designed for the "use" of equipment controlled by 7A001 to 7A006, 7A101 to 7A106, 7A115, 7B001, 7B002, 7B003, 7B101, 7B102, 7B103 or 7B104.

* * * * *

7E101 "Technology", other than "technology" controlled by 7E003, according to the General Technology Note for the "use" of equipment controlled by 7A001 to 7A006, 7A101 to 7A106, 7A115 to 7A117, 7B001, 7B002, 7B003, 7B101, 7B102, 7B103, 7B104, 7D101 to 7D103.

* * * * *

DATED:

R. Roger Majak

Assistant Secretary

for Export Administration