Revisions to Certain End-User Controls Under the Export Administration Regulations; Clarification Regarding License Requirements for Transfers (in-country) to Persons Listed on the Entity List, 45990-45993 [E9-21367]
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45990
Federal Register / Vol. 74, No. 172 / Tuesday, September 8, 2009 / Rules and Regulations
following officials of the Cuban
Government and Cuban Communist
Party:
(i) Ineligible Cuban Government
Officials. Ministers and vice-ministers;
members of the Council of State;
members of the Council of Ministers;
members and employees of the National
Assembly of People’s Power; members
of any provincial assembly; local sector
chiefs of the Committees for the Defense
of the Revolution; Director Generals and
sub-Director Generals and higher of all
Cuban ministries and state agencies;
employees of the Ministry of the Interior
(MININT); employees of the Ministry of
Defense (MINFAR); secretaries and first
secretaries of the Confederation of Labor
of Cuba (CTC) and its component
unions; chief editors, editors and deputy
editors of Cuban state-run media
organizations and programs, including
newspapers, television, and radio; or
members and employees of the Supreme
Court (Tribuno Supremo Nacional).
(ii) Ineligible Cuban Communist Party
Officials. Members of the Politburo; the
Central Committee; Department Heads
of the Central Committee; employees of
the Central Committee; and the
secretaries and first secretaries of
provincial Party central committees.
PART 746—[AMENDED]
6. The authority citation for part 746
is revised to read as follows:
■
Authority: 50 U.S.C. app. 2401 et seq.; 50
U.S.C. 1701 et seq.; 22 U.S.C. 287c; Sec.
1503, Pub. L. 108–11, 117 Stat. 559; 22 U.S.C.
6004; 22 U.S.C. 7201 et seq.; 22 U.S.C. 7210;
E.O. 12854, 58 FR 36587, 3 CFR, 1993 Comp.,
p. 614; E.O. 12918, 59 FR 28205, 3 CFR, 1994
Comp., p. 899; E.O. 13222, 3 CFR, 2001
Comp., p. 783; Presidential Determination
2003–23 of May 7, 2003, 68 FR 26459, May
16, 2003; Presidential Determination 2007–7
of December 7, 2006, 72 FR 1899 (January 16,
2007); Notice of August 13, 2009, 74 FR
41325 (August 14, 2009).
7. Section 746.2, is amended by
adding a paragraph (a)(1)(xiii) and by
revising paragraph (b)(2) to read as
follows:
■
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§ 746.2
Cuba.
(a) * * *
(1) * * *
(xiii) Commodities and software
authorized under License Exception
Consumer Communications Devices
(CCD) (see § 740.19 of the EAR).
*
*
*
*
*
(b) * * *
(2) Items may be authorized for export
or reexport to Cuba on a case-by-case
basis, provided the items are necessary
to provide efficient and adequate
telecommunications links between the
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United States and Cuba, including links
established through third countries, and
including the provision of satellite radio
or satellite television services to Cuba.
*
*
*
*
*
Dated: September 1, 2009.
Matthew S. Borman,
Acting Assistant Secretary for Export
Administration.
[FR Doc. E9–21402 Filed 9–3–09; 4:15 pm]
BILLING CODE 3510–33–P
DEPARTMENT OF COMMERCE
Bureau of Industry and Security
15 CFR Part 744
[Docket No. 090126062–91139–01]
RIN 0694–AE54
Revisions to Certain End-User
Controls Under the Export
Administration Regulations;
Clarification Regarding License
Requirements for Transfers (incountry) to Persons Listed on the
Entity List
AGENCY: Bureau of Industry and
Security, Commerce.
ACTION: Final rule.
SUMMARY: The Bureau of Industry and
Security (BIS) is amending the Export
Administration Regulations (EAR) to
make revisions to three sections that are
used by the United States Government
as the basis for placing persons onto the
Entity List. These three sections
specified license requirements for
exports and reexports to persons listed
on the Entity List, however; the sections
were silent regarding whether or not the
scope of the licensing requirements
included transfers (in-country). This
rule adds transfers (in-country) to the
scope of the license requirements under
each of the three sections. As a result of
adding transfers (in-country) to these
three end-user controls, all of the enduse and end-user controls that are used
as a regulatory basis for placing persons
on the Entity List now specify that the
scope of the license requirements
includes exports, reexports, and
transfers (in-country).
The Entity List provides notice to the
public that certain exports, reexports,
and transfers (in-country) to parties
identified on the Entity List require a
license from the Bureau of Industry and
Security (BIS) and that availability of
License Exceptions in such transactions
is limited.
DATES: Effective Date: This rule is
effective September 8, 2009. Although
there is no formal comment period,
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public comments on this regulation are
welcome on a continuing basis.
ADDRESSES: You may submit comments,
identified by RIN 0694–AE54, by any of
the following methods:
E-mail: publiccomments@bis.doc.gov.
Include ‘‘RIN 0694–AE54’’ in the subject
line of the message.
Fax: (202) 482–3355. Please alert the
Regulatory Policy Division, by calling
(202) 482–2440, if you are faxing
comments.
Mail or Hand Delivery/Courier:
Timothy Mooney, U.S. Department of
Commerce, Bureau of Industry and
Security, Regulatory Policy Division,
14th St. & Pennsylvania Avenue, NW.,
Room 2705, Washington, DC 20230,
Attn: RIN 0694–AE54.
Send comments regarding the
collection of information associated
with this rule, including suggestions for
reducing the burden, to Jasmeet K.
Seehra, Office of Management and
Budget (OMB), by e-mail to
Jasmeet_K._Seehra@omb.eop.gov or by
fax to (202) 395–7285; and to the
Regulatory Policy Division, Bureau of
Industry and Security, Department of
Commerce, 14th St. & Pennsylvania
Avenue, NW., Room 2705, Washington,
DC 20230. Comments on this collection
of information should be submitted
separately from comments on the final
rule (i.e., RIN 0694–AE54)—all
comments on the latter should be
submitted by one of the three methods
outlined above.
FOR FURTHER INFORMATION CONTACT:
Elizabeth Scott Sangine, End-User
Review Committee, Office of the
Assistant Secretary, Export
Administration, Bureau of Industry and
Security, Department of Commerce,
Phone: (202) 482–3343, Fax: (202) 482–
3911, E-mail: bscott@bis.doc.gov.
SUPPLEMENTARY INFORMATION:
Background
The Entity List provides notice to the
public that certain exports, reexports,
and transfers (in-country) to parties
identified on the Entity List require a
license from the Bureau of Industry and
Security (BIS) and that availability of
license exceptions in such transactions
is limited. Persons are placed on the
Entity List on the basis of certain
sections of part 744 (Control Policy:
End-User and End-Use Based) of the
EAR.
The End-User Review Committee
(ERC), composed of representatives of
the Departments of Commerce (Chair),
State, Defense, Energy and, where
appropriate, the Treasury, makes all
decisions regarding additions to,
removals from or changes to the Entity
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List. The ERC makes all decisions to add
an entry to the Entity List by majority
vote and all decisions to remove or
modify an entry by unanimous vote.
There are six sections in part 744 of
the EAR that provide the regulatory
basis for putting persons on the Entity
List: §§ 744.2, 744.3, 744.4, 744.10,
744.11, and 744.20. Sections 744.2,
744.3, and 744.4 are foreign policy enduse controls under the EAR that prohibit
transactions destined for certain
nuclear, missile or chemical and
biological end-uses. Sections 744.10,
744.11, and 744.20 are foreign policy
end-user controls that prohibit
transactions destined for certain
individuals. Prior to the publication of
this rule, the three end-user controls
each specified that they applied to
exports and reexports, but were silent
on whether these end-user controls also
applied to transfers (in-country). The
United States Government intends the
license requirements for §§ 744.10,
744.11, and 744.20 to apply to transfers
(in-country) as well as to exports and
reexports. Therefore, this rule extends
the scope of these three sections to
include transfers (in-country).
The rationale for the extension of this
license requirement to include transfers
(in-country) is that the United States
Government’s objective in placing a
person on the Entity List on the basis of
one of the end-user controls in part 744
of the EAR is to have an opportunity to
review any transaction involving items
subject to the EAR prior to shipment or
transfer (in-country) to a listed person.
Regardless of the form of the transaction
(export, reexport, or transfer (incountry)), the United States Government
believes it is important to review all
transactions involving persons listed on
the Entity List prior to the initiation of
a transaction with a listed person and/
or receipt by the listed person of an item
in a transaction.
In publishing this rule, the United
States Government is achieving the
export control objective of allowing the
United States Government to have prior
review of any transaction involving
items subject to the EAR and persons
included on the Entity List. This prior
review is important because the United
States Government does not want these
end-users of concern (i.e., persons listed
on the Entity List) to receive items
subject to the EAR that might allow
them to continue their activities of
concern without specific United States
Government authorization.
This rule also clarifies that prior to
the publication of this rule, persons
added to the Entity List on the basis of
their involvement in the activities
described in sections 744.2, 744.3 and
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744.4, as described above, were subject
to licensing requirements applicable to
exports, reexports, and transfers (incountry).
This rule makes the following
revisions to the Export Administration
Regulations:
In Section 744.10 (Restrictions on
Certain Entities in Russia), this rule
expands the scope of this end-user
control by adding transfer (in-country)
to the license requirements of this enduser control. With the publication of
this rule, the license requirements for
this end-user control apply to exports,
reexports, and transfers (in-country).
Specifically, this rule revises the second
sentence of paragraph (a) to specify that
a license is required, to the extent
specified on the Entity List, to transfer
(in-country) any item subject to the EAR
to such entities (i.e., persons added to
the Entity List on the basis of § 744.10).
This rule also revises paragraph (c) to
specify that license applications to
transfer (in-country) items subject to the
EAR to these entities will be reviewed
with a presumption of denial.
In Section 744.11 (License
Requirements that Apply to Entities
Acting Contrary to the National Security
or Foreign Policy Interests of the United
States), this rule expands the scope of
this end-user control by adding transfer
(in-country) to the license requirements
of this end-user control. With the
publication of this rule, the license
requirements for this end-user control
apply to exports, reexports, and
transfers (in-country). To broaden the
scope of this end-user control, this rule
makes three changes to this section.
First, this rule revises the first sentence
of the introductory text of this section
to specify that transfers (in-country) are
within the scope of the foreign policy
controls that BIS may impose under this
section. Second, this rule revises the
first sentence of paragraph (a) to specify
that for the license requirements of this
section, a license is required, to the
extent specified on the Entity List, to
transfer (in-country) any item subject to
the EAR to an entity that is listed on the
Entity List in an entry that contains a
reference to this section (i.e., persons
added to the Entity List on the basis of
§ 744.11). Third, under paragraph (b)(5),
this rule adds transfer (in-country) to
the scope of this illustrative example
provided for the criteria used for
revising the Entity List in paragraph (b)
of this section.
In Section 744.20 (License
Requirements that Apply to Certain
Sanctioned Entities), this rule expands
the scope of this end-user control by
adding transfer (in-country) to the
license requirements of this end-user
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45991
control. With the publication of this
rule, the license requirements for this
end-user control apply to exports,
reexports and transfers (in-country).
Specifically, this rule revises the
introductory text of paragraph (a) to
specify that a license is required, to the
extent specified on the Entity List, to
transfer (in-country) any item subject to
the EAR to such entities (i.e., persons
added to the Entity List on the basis of
§ 744.20). This rule also revises
paragraph (b) to add transfer (incountry) to the general restriction on
using license exceptions in paragraph
(b) of this section. Lastly, this rule
revises paragraph (c) to specify that
license applications to transfer (incountry) items subject to the EAR to
these entities will be reviewed with a
presumption of denial.
In Supplement No. 4 to part 744 (The
Entity List) of the EAR, this rule revises
the introductory text of the Entity List
to specify that the license requirements
for these entities includes exports,
reexports and transfers (in-country),
unless otherwise stated. This
clarification is needed because now all
of the sections of part 744 that provide
the regulatory basis for adding a person
to the Entity List include license
requirements for exports, reexports and
transfers (in-country), unless otherwise
specifically stated in an entry on the
Entity List for a listed person.
Consistent with the provisions of
section 6 of the Export Administration
Act of 1979, as amended (EAA), a
foreign policy report was submitted to
Congress on August 11, 2009, notifying
Congress of the imposition of foreign
policy-based licensing requirements
reflected in this rule.
Although the Export Administration
Act expired on August 20, 2001, the
President, through Executive Order
13222 of August 17, 2001, 3 CFR, 2001
Comp., p. 783 (2002), as extended by the
Notice of August 13, 2009, 74 FR 41325
(August 14, 2009), has continued the
Export Administration Regulations in
effect under the International
Emergency Economic Powers Act.
Rulemaking Requirements
1. This rule has been determined to be
not significant for purposes of Executive
Order 12866.
2. Notwithstanding 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 of 1995 (44 U.S.C. 3501
et seq.) (PRA), unless that collection of
information displays a currently valid
Office of Management and Budget
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Federal Register / Vol. 74, No. 172 / Tuesday, September 8, 2009 / Rules and Regulations
(OMB) Control Number. This regulation
involves collections previously
approved by the OMB under control
numbers 0694–0088, ‘‘Multi-Purpose
Application,’’ which carries a burden
hour estimate of 58 minutes to prepare
and submit form BIS–748.
Miscellaneous and recordkeeping
activities account for 12 minutes per
submission. Total burden hours
associated with the Paperwork
Reduction Act and Office of
Management and Budget control
number 0694–0088 are expected to
increase slightly as a result of this rule.
3. This rule does not contain policies
with Federalism implications as that
term is defined in Executive Order
13132.
4. 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.
(See 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 rule. 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.
List of Subjects in 15 CFR Part 744
Exports, Reporting and recordkeeping
requirements, Terrorism.
■ Accordingly, part 744 of the Export
Administration Regulations (15 CFR
parts 730–774) is amended as follows:
PART 744—[AMENDED]
1. The authority citation for 15 CFR
part 744 is revised to read as follows:
■
Authority: 50 U.S.C. app. 2401 et seq.; 50
U.S.C. 1701 et seq.; 22 U.S.C. 3201 et seq.;
Country
42 U.S.C. 2139a; 22 U.S.C. 7201 et seq.; 22
U.S.C. 7210; E.O. 12058, 43 FR 20947, 3 CFR,
1978 Comp., p. 179; E.O. 12851, 58 FR 33181,
3 CFR, 1993 Comp., p. 608; E.O. 12938, 59
FR 59099, 3 CFR, 1994 Comp., p. 950; E.O.
12947, 60 FR 5079, 3 CFR, 1995 Comp., p.
356; E.O. 13026, 61 FR 58767, 3 CFR, 1996
Comp., p. 228; E.O. 13099, 63 FR 45167, 3
CFR, 1998 Comp., p. 208; E.O. 13222, 66 FR
44025, 3 CFR, 2001 Comp., p. 783; E.O.
13224, 66 FR 49079, 3 CFR, 2001 Comp., p.
786; Notice of August 13, 2009, 74 FR 41325
(August 14, 2009); Notice of November 10,
2008, 73 FR 67097 (November 12, 2008).
2. Section 744.10 is amended:
a. By revising the second sentence of
paragraph (a); and
■ b. By revising paragraph (c), to read as
follows:
■
■
§ 744.10
Russia.
Restrictions on certain entities in
(a) * * * A license is required, to the
extent specified on the Entity List, to
export, reexport, or transfer (in-country)
any item subject to the EAR to such
entities.
*
*
*
*
*
(c) License review standard.
Applications to export, reexport, or
transfer (in-country) items subject to the
EAR to these entities will be reviewed
with a presumption of denial.
■ 3. Section 744.11 is amended:
■ a. By revising the first sentence of the
introductory text of the section;
■ b. By revising the first sentence of
paragraph (a); and
■ c. By revising paragraph (b)(5), to read
as follows:
§ 744.11 License requirements that apply
to entities acting contrary to the national
security or foreign policy interests of the
United States.
BIS may impose foreign policy export,
reexport, and transfer (in-country)
license requirements, limitations on
availability of license exceptions, and
set license application review policy
based on the criteria in this section.
* * *
(a) * * *A license is required, to the
extent specified on the Entity List, to
export, reexport, or transfer (in-country)
Entity
License requirement
any item subject to the EAR to an entity
that is listed on the Entity List in an
entry that contains a reference to this
section. * * *
(b) * * *
(5) Engaging in conduct that poses a
risk of violating the EAR when such
conduct raises sufficient concern that
the End-User Review committee
believes that prior review of exports,
reexports, or transfers (in-country)
involving the party and the possible
imposition of license conditions or
license denial enhances BIS’s ability to
prevent violations of the EAR.
■ 4. Section 744.20 is amended:
■ a. By revising the first sentence of the
introductory text of the section;
■ b. By revising the second sentence of
paragraph (a); and
■ c. By revising paragraphs (b) and (c),
to read as follows:
§ 744.20 License requirements that apply
to certain sanctioned entities.
BIS may impose, as foreign policy
controls, export, reexport, and transfer
(in-country) license requirements and
set licensing policy with respect to
certain entities that have been
sanctioned by the State Department.
* * *
(a) * * * A license is required, to the
extent specified on the Entity List, to
export, reexport, or transfer (in-country)
any item to such entities.
(b) License Exceptions. No license
exception may be used to export,
reexport, or transfer (in-country) to such
entities unless specifically authorized
on the Entity List.
(c) Licensing policy. Applications to
export, reexport, or transfer (in-country)
to such entities will be reviewed
according to the licensing policy set
forth on the Entity List.
■ 5. Supplement No. 4 to part 744 is
amended by revising the introductory
text, to read as follows:
Supplement No. 4 to Part 744—Entity
List
License review policy
Federal Register citation
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This Supplement lists certain entities subject to license requirements for specified items under this part 744 of the EAR. License requirements
for these entities include exports, reexports, and transfers (in-country) unless otherwise stated. This list of entities is revised and updated on a
periodic basis in this Supplement by adding new or amended notifications and deleting notifications no longer in effect.
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Federal Register / Vol. 74, No. 172 / Tuesday, September 8, 2009 / Rules and Regulations
Dated: August 31, 2009.
Matthew S. Borman,
Acting Assistant Secretary for Export
Administration.
[FR Doc. E9–21367 Filed 9–4–09; 8:45 am]
BILLING CODE 3510–33–P
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[TD 9459]
RIN 1545–BH53
Reasonable Good Faith Interpretation
of Required Minimum Distribution
Rules by Governmental Plans
AGENCY: Internal Revenue Service (IRS),
Treasury.
ACTION: Final regulations.
SUMMARY: This document contains final
regulations under sections 401(a)(9) and
403(b) of the Internal Revenue Code
(Code) to permit a governmental plan to
comply with the required minimum
distribution rules by using a reasonable
and good faith interpretation of the
statute. These regulations affect
administrators of, employers
maintaining, participants in, and
beneficiaries of governmental plans.
DATES: Effective Date: These regulations
are effective on September 8, 2009.
Applicability Date: These regulations
apply to all plan years to which section
401(a)(9) applies to the plan.
FOR FURTHER INFORMATION CONTACT:
Concerning the regulations, Cathy V.
Pastor or Michael P. Brewer at (202)
622–6090 (not a toll-free number).
SUPPLEMENTARY INFORMATION:
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Background
Section 401(a)(9) provides required
minimum distribution rules for a
qualified trust under section 401(a). In
general, under these rules, distribution
of each participant’s entire interest must
begin by April 1 of the calendar year
following the later of (1) the calendar
year in which the participant attains age
701⁄2 or (2) the calendar year in which
the participant retires (‘‘the required
beginning date’’). If the entire interest of
the participant is not distributed by the
required beginning date, then section
401(a)(9)(A) provides that the entire
interest of the participant must be
distributed beginning not later than the
required beginning date, in accordance
with regulations, over the life of the
participant or lives of the participant
and a designated beneficiary (or over a
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period not extending beyond the life
expectancy of the participant or the life
expectancy of the participant and a
designated beneficiary). Section
401(a)(9)(B) provides the required
minimum distribution rules after the
death of the participant.
IRAs described in section 408, section
403(b) plans, and eligible deferred
compensation plans under section
457(b), also are subject to the required
minimum distribution rules of section
401(a)(9) pursuant to sections 408(a)(6)
and (b)(3), 403(b)(10), and 457(d)(2),
respectively, and the regulations under
those sections. In 2002, the IRS and the
Treasury Department published final
regulations under sections 401(a)(9),
403(b), and 408 in the Federal Register
(67 FR 18987). Section 1.401(a)(9)–1,
A–2(a), provides that the final
regulations apply for purposes of
determining required minimum
distributions for calendar years
beginning on or after January 1, 2003.
The rules for defined benefit plans and
annuities were included in a temporary
regulation, § 1.401(a)(9)–6T, as well as
in a proposed regulation (67 FR 18834)
in order to allow taxpayers to comment
on the rules.
In 2004, the IRS and the Treasury
Department replaced the temporary
regulations with final regulations under
§ 1.401(a)(9)–6 (69 FR 33288). The final
regulations contain a ‘‘grandfather rule’’
in Q&A–16, which provides that
annuity distribution options provided
under the terms of a governmental plan
(within the meaning section 414(d)) as
in effect on April 17, 2002, are treated
as satisfying the requirements of section
401(a)(9) if they satisfy a reasonable and
good faith interpretation of the
provisions of section 401(a)(9). In
addition, Q&A–17 provides that, for
distributions from any defined benefit
plan or annuity contract during 2003,
2004, and 2005, the payments could
satisfy a reasonable and good faith
interpretation of section 401(a)(9) in lieu
of § 1.401(a)(9)–6. For governmental
plans, § 1.401(a)(9)–6, Q&A–17,
extended this reasonable good faith
standard to the end of the calendar year
that contains the 90th day after the
opening of the first legislative session of
the legislative body with the authority
to amend the plan that begins on or after
June 15, 2004, if such 90th day is later
than December 31, 2005.
In 2003, the IRS and the Treasury
Department published final regulations
under section 457(b) in the Federal
Register (68 FR 41230). These
regulations included § 1.457–6(d),
which provides that a section 457(b)
eligible plan must meet the
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45993
requirements of section 401(a)(9) and
the regulations under that section.
In 2007, the IRS and the Treasury
Department published final regulations
under section 403(b) in the Federal
Register (72 FR 41128). These
regulations, which become effective for
tax years beginning after December 31,
2008, included § 1.403(b)–6(e)(1), which
provides that a section 403(b) contract
must meet the requirements of section
401(a)(9). Section 1.403(b)–6(e)(2)
provides, with certain exceptions, that
section 403(b) contracts apply the
section 401(a)(9) required minimum
distribution rules in accordance with
§ 1.408–8.
Section 1.408–8, Q&A–1, provides,
with certain exceptions, that in order to
satisfy section 401(a)(9) for purposes of
determining required minimum
distributions, the rules of § 1.401(a)(9)–
1 through 1.401(a)(9)–9 must be applied.
Section 823 of the Pension Protection
Act of 2006, Public Law 109–280 (120
Stat. 780) (PPA 06), instructs the
Secretary of the Treasury to issue
regulations under which, for all years to
which section 401(a)(9) applies, a
governmental plan, within the meaning
of section 414(d), shall be treated as
having complied with section 401(a)(9)
if such plan complies with a reasonable
good faith interpretation of section
401(a)(9).
On July 10, 2008, the IRS and
Treasury Department published a notice
of proposed rulemaking (REG–142040–
07) in the Federal Register (73 FR
39630–01) proposing regulations that
would implement section 823 of PPA 06
by amending the regulations under
sections 401(a)(9) and 403(b) of the
Code. The IRS and Treasury Department
received no comments on the proposed
regulations and no public hearing was
requested or held. Accordingly, the
provisions of these final regulations are
identical to the proposed regulations.
Explanation of Provisions
The final regulations amend the
regulations under section 401(a)(9) to
treat a governmental plan, within the
meaning of section 414(d), as having
complied with the rules of section
401(a)(9) if the governmental plan
applies a reasonable and good faith
interpretation of section 401(a)(9). The
same rule applies to an eligible 457(b)
plan maintained by a government. In
addition, this rule applies to a section
403(b) contract that is part of a
governmental plan, and the regulations
under section 403(b) are amended
accordingly. The final regulations also
make conforming amendments to the
regulations under section 401(a)(9) that
eliminate other special rules for
E:\FR\FM\08SER1.SGM
08SER1
]]>Agencies
[Federal Register Volume 74, Number 172 (Tuesday, September 8, 2009)]
[Rules and Regulations]
[Pages 45990-45993]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-21367]
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
15 CFR Part 744
[Docket No. 090126062-91139-01]
RIN 0694-AE54
Revisions to Certain End-User Controls Under the Export
Administration Regulations; Clarification Regarding License
Requirements for Transfers (in-country) to Persons Listed on the Entity
List
AGENCY: Bureau of Industry and Security, Commerce.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Bureau of Industry and Security (BIS) is amending the
Export Administration Regulations (EAR) to make revisions to three
sections that are used by the United States Government as the basis for
placing persons onto the Entity List. These three sections specified
license requirements for exports and reexports to persons listed on the
Entity List, however; the sections were silent regarding whether or not
the scope of the licensing requirements included transfers (in-
country). This rule adds transfers (in-country) to the scope of the
license requirements under each of the three sections. As a result of
adding transfers (in-country) to these three end-user controls, all of
the end-use and end-user controls that are used as a regulatory basis
for placing persons on the Entity List now specify that the scope of
the license requirements includes exports, reexports, and transfers
(in-country).
The Entity List provides notice to the public that certain exports,
reexports, and transfers (in-country) to parties identified on the
Entity List require a license from the Bureau of Industry and Security
(BIS) and that availability of License Exceptions in such transactions
is limited.
DATES: Effective Date: This rule is effective September 8, 2009.
Although there is no formal comment period, public comments on this
regulation are welcome on a continuing basis.
ADDRESSES: You may submit comments, identified by RIN 0694-AE54, by any
of the following methods:
E-mail: publiccomments@bis.doc.gov. Include ``RIN 0694-AE54'' in
the subject line of the message.
Fax: (202) 482-3355. Please alert the Regulatory Policy Division,
by calling (202) 482-2440, if you are faxing comments.
Mail or Hand Delivery/Courier: Timothy Mooney, U.S. Department of
Commerce, Bureau of Industry and Security, Regulatory Policy Division,
14th St. & Pennsylvania Avenue, NW., Room 2705, Washington, DC 20230,
Attn: RIN 0694-AE54.
Send comments regarding the collection of information associated
with this rule, including suggestions for reducing the burden, to
Jasmeet K. Seehra, Office of Management and Budget (OMB), by e-mail to
Jasmeet_K._Seehra@omb.eop.gov or by fax to (202) 395-7285; and to the
Regulatory Policy Division, Bureau of Industry and Security, Department
of Commerce, 14th St. & Pennsylvania Avenue, NW., Room 2705,
Washington, DC 20230. Comments on this collection of information should
be submitted separately from comments on the final rule (i.e., RIN
0694-AE54)--all comments on the latter should be submitted by one of
the three methods outlined above.
FOR FURTHER INFORMATION CONTACT: Elizabeth Scott Sangine, End-User
Review Committee, Office of the Assistant Secretary, Export
Administration, Bureau of Industry and Security, Department of
Commerce, Phone: (202) 482-3343, Fax: (202) 482-3911, E-mail:
bscott@bis.doc.gov.
SUPPLEMENTARY INFORMATION:
Background
The Entity List provides notice to the public that certain exports,
reexports, and transfers (in-country) to parties identified on the
Entity List require a license from the Bureau of Industry and Security
(BIS) and that availability of license exceptions in such transactions
is limited. Persons are placed on the Entity List on the basis of
certain sections of part 744 (Control Policy: End-User and End-Use
Based) of the EAR.
The End-User Review Committee (ERC), composed of representatives of
the Departments of Commerce (Chair), State, Defense, Energy and, where
appropriate, the Treasury, makes all decisions regarding additions to,
removals from or changes to the Entity
[[Page 45991]]
List. The ERC makes all decisions to add an entry to the Entity List by
majority vote and all decisions to remove or modify an entry by
unanimous vote.
There are six sections in part 744 of the EAR that provide the
regulatory basis for putting persons on the Entity List: Sec. Sec.
744.2, 744.3, 744.4, 744.10, 744.11, and 744.20. Sections 744.2, 744.3,
and 744.4 are foreign policy end-use controls under the EAR that
prohibit transactions destined for certain nuclear, missile or chemical
and biological end-uses. Sections 744.10, 744.11, and 744.20 are
foreign policy end-user controls that prohibit transactions destined
for certain individuals. Prior to the publication of this rule, the
three end-user controls each specified that they applied to exports and
reexports, but were silent on whether these end-user controls also
applied to transfers (in-country). The United States Government intends
the license requirements for Sec. Sec. 744.10, 744.11, and 744.20 to
apply to transfers (in-country) as well as to exports and reexports.
Therefore, this rule extends the scope of these three sections to
include transfers (in-country).
The rationale for the extension of this license requirement to
include transfers (in-country) is that the United States Government's
objective in placing a person on the Entity List on the basis of one of
the end-user controls in part 744 of the EAR is to have an opportunity
to review any transaction involving items subject to the EAR prior to
shipment or transfer (in-country) to a listed person. Regardless of the
form of the transaction (export, reexport, or transfer (in-country)),
the United States Government believes it is important to review all
transactions involving persons listed on the Entity List prior to the
initiation of a transaction with a listed person and/or receipt by the
listed person of an item in a transaction.
In publishing this rule, the United States Government is achieving
the export control objective of allowing the United States Government
to have prior review of any transaction involving items subject to the
EAR and persons included on the Entity List. This prior review is
important because the United States Government does not want these end-
users of concern (i.e., persons listed on the Entity List) to receive
items subject to the EAR that might allow them to continue their
activities of concern without specific United States Government
authorization.
This rule also clarifies that prior to the publication of this
rule, persons added to the Entity List on the basis of their
involvement in the activities described in sections 744.2, 744.3 and
744.4, as described above, were subject to licensing requirements
applicable to exports, reexports, and transfers (in-country).
This rule makes the following revisions to the Export
Administration Regulations:
In Section 744.10 (Restrictions on Certain Entities in Russia),
this rule expands the scope of this end-user control by adding transfer
(in-country) to the license requirements of this end-user control. With
the publication of this rule, the license requirements for this end-
user control apply to exports, reexports, and transfers (in-country).
Specifically, this rule revises the second sentence of paragraph (a) to
specify that a license is required, to the extent specified on the
Entity List, to transfer (in-country) any item subject to the EAR to
such entities (i.e., persons added to the Entity List on the basis of
Sec. 744.10). This rule also revises paragraph (c) to specify that
license applications to transfer (in-country) items subject to the EAR
to these entities will be reviewed with a presumption of denial.
In Section 744.11 (License Requirements that Apply to Entities
Acting Contrary to the National Security or Foreign Policy Interests of
the United States), this rule expands the scope of this end-user
control by adding transfer (in-country) to the license requirements of
this end-user control. With the publication of this rule, the license
requirements for this end-user control apply to exports, reexports, and
transfers (in-country). To broaden the scope of this end-user control,
this rule makes three changes to this section. First, this rule revises
the first sentence of the introductory text of this section to specify
that transfers (in-country) are within the scope of the foreign policy
controls that BIS may impose under this section. Second, this rule
revises the first sentence of paragraph (a) to specify that for the
license requirements of this section, a license is required, to the
extent specified on the Entity List, to transfer (in-country) any item
subject to the EAR to an entity that is listed on the Entity List in an
entry that contains a reference to this section (i.e., persons added to
the Entity List on the basis of Sec. 744.11). Third, under paragraph
(b)(5), this rule adds transfer (in-country) to the scope of this
illustrative example provided for the criteria used for revising the
Entity List in paragraph (b) of this section.
In Section 744.20 (License Requirements that Apply to Certain
Sanctioned Entities), this rule expands the scope of this end-user
control by adding transfer (in-country) to the license requirements of
this end-user control. With the publication of this rule, the license
requirements for this end-user control apply to exports, reexports and
transfers (in-country). Specifically, this rule revises the
introductory text of paragraph (a) to specify that a license is
required, to the extent specified on the Entity List, to transfer (in-
country) any item subject to the EAR to such entities (i.e., persons
added to the Entity List on the basis of Sec. 744.20). This rule also
revises paragraph (b) to add transfer (in-country) to the general
restriction on using license exceptions in paragraph (b) of this
section. Lastly, this rule revises paragraph (c) to specify that
license applications to transfer (in-country) items subject to the EAR
to these entities will be reviewed with a presumption of denial.
In Supplement No. 4 to part 744 (The Entity List) of the EAR, this
rule revises the introductory text of the Entity List to specify that
the license requirements for these entities includes exports, reexports
and transfers (in-country), unless otherwise stated. This clarification
is needed because now all of the sections of part 744 that provide the
regulatory basis for adding a person to the Entity List include license
requirements for exports, reexports and transfers (in-country), unless
otherwise specifically stated in an entry on the Entity List for a
listed person.
Consistent with the provisions of section 6 of the Export
Administration Act of 1979, as amended (EAA), a foreign policy report
was submitted to Congress on August 11, 2009, notifying Congress of the
imposition of foreign policy-based licensing requirements reflected in
this rule.
Although the Export Administration Act expired on August 20, 2001,
the President, through Executive Order 13222 of August 17, 2001, 3 CFR,
2001 Comp., p. 783 (2002), as extended by the Notice of August 13,
2009, 74 FR 41325 (August 14, 2009), has continued the Export
Administration Regulations in effect under the International Emergency
Economic Powers Act.
Rulemaking Requirements
1. This rule has been determined to be not significant for purposes
of Executive Order 12866.
2. Notwithstanding 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 of 1995 (44 U.S.C. 3501 et seq.) (PRA),
unless that collection of information displays a currently valid Office
of Management and Budget
[[Page 45992]]
(OMB) Control Number. This regulation involves collections previously
approved by the OMB under control numbers 0694-0088, ``Multi-Purpose
Application,'' which carries a burden hour estimate of 58 minutes to
prepare and submit form BIS-748. Miscellaneous and recordkeeping
activities account for 12 minutes per submission. Total burden hours
associated with the Paperwork Reduction Act and Office of Management
and Budget control number 0694-0088 are expected to increase slightly
as a result of this rule.
3. This rule does not contain policies with Federalism implications
as that term is defined in Executive Order 13132.
4. 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. (See 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 rule. 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.
List of Subjects in 15 CFR Part 744
Exports, Reporting and recordkeeping requirements, Terrorism.
0
Accordingly, part 744 of the Export Administration Regulations (15 CFR
parts 730-774) is amended as follows:
PART 744--[AMENDED]
0
1. The authority citation for 15 CFR part 744 is revised to read as
follows:
Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;
22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; 22 U.S.C. 7201 et seq.; 22
U.S.C. 7210; E.O. 12058, 43 FR 20947, 3 CFR, 1978 Comp., p. 179;
E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p. 608; E.O. 12938, 59
FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 12947, 60 FR 5079, 3 CFR,
1995 Comp., p. 356; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p.
228; E.O. 13099, 63 FR 45167, 3 CFR, 1998 Comp., p. 208; E.O. 13222,
66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13224, 66 FR 49079, 3
CFR, 2001 Comp., p. 786; Notice of August 13, 2009, 74 FR 41325
(August 14, 2009); Notice of November 10, 2008, 73 FR 67097
(November 12, 2008).
0
2. Section 744.10 is amended:
0
a. By revising the second sentence of paragraph (a); and
0
b. By revising paragraph (c), to read as follows:
Sec. 744.10 Restrictions on certain entities in Russia.
(a) * * * A license is required, to the extent specified on the
Entity List, to export, reexport, or transfer (in-country) any item
subject to the EAR to such entities.
* * * * *
(c) License review standard. Applications to export, reexport, or
transfer (in-country) items subject to the EAR to these entities will
be reviewed with a presumption of denial.
0
3. Section 744.11 is amended:
0
a. By revising the first sentence of the introductory text of the
section;
0
b. By revising the first sentence of paragraph (a); and
0
c. By revising paragraph (b)(5), to read as follows:
Sec. 744.11 License requirements that apply to entities acting
contrary to the national security or foreign policy interests of the
United States.
BIS may impose foreign policy export, reexport, and transfer (in-
country) license requirements, limitations on availability of license
exceptions, and set license application review policy based on the
criteria in this section. * * *
(a) * * *A license is required, to the extent specified on the
Entity List, to export, reexport, or transfer (in-country) any item
subject to the EAR to an entity that is listed on the Entity List in an
entry that contains a reference to this section. * * *
(b) * * *
(5) Engaging in conduct that poses a risk of violating the EAR when
such conduct raises sufficient concern that the End-User Review
committee believes that prior review of exports, reexports, or
transfers (in-country) involving the party and the possible imposition
of license conditions or license denial enhances BIS's ability to
prevent violations of the EAR.
0
4. Section 744.20 is amended:
0
a. By revising the first sentence of the introductory text of the
section;
0
b. By revising the second sentence of paragraph (a); and
0
c. By revising paragraphs (b) and (c), to read as follows:
Sec. 744.20 License requirements that apply to certain sanctioned
entities.
BIS may impose, as foreign policy controls, export, reexport, and
transfer (in-country) license requirements and set licensing policy
with respect to certain entities that have been sanctioned by the State
Department. * * *
(a) * * * A license is required, to the extent specified on the
Entity List, to export, reexport, or transfer (in-country) any item to
such entities.
(b) License Exceptions. No license exception may be used to export,
reexport, or transfer (in-country) to such entities unless specifically
authorized on the Entity List.
(c) Licensing policy. Applications to export, reexport, or transfer
(in-country) to such entities will be reviewed according to the
licensing policy set forth on the Entity List.
0
5. Supplement No. 4 to part 744 is amended by revising the introductory
text, to read as follows:
Supplement No. 4 to Part 744--Entity List
----------------------------------------------------------------------------------------------------------------
License License review Federal Register
Country Entity requirement policy citation
----------------------------------------------------------------------------------------------------------------
This Supplement lists certain entities subject to license requirements for specified items under this part 744
of the EAR. License requirements for these entities include exports, reexports, and transfers (in-country)
unless otherwise stated. This list of entities is revised and updated on a periodic basis in this Supplement by
adding new or amended notifications and deleting notifications no longer in effect.
----------------------------------------------------------------------------------------------------------------
* * * * * * *
----------------------------------------------------------------------------------------------------------------
[[Page 45993]]
Dated: August 31, 2009.
Matthew S. Borman,
Acting Assistant Secretary for Export Administration.
[FR Doc. E9-21367 Filed 9-4-09; 8:45 am]
BILLING CODE 3510-33-P
