Revision of Controls for Cambodia Under the Export Administration Regulations, 70015-70020 [2021-26633]
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Federal Register / Vol. 86, No. 234 / Thursday, December 9, 2021 / Rules and Regulations
Schedule of the United States. The list
of the HTSUS Classifications referenced
in this table of GAEs is drawn from the
HTSUS and ITC Change Records for
HTSUS Classifications (compiled at
https://hts.usitc.gov/) and will be
amended when the ITC publishes
subsequent Change Records. If there are
any discrepancies between the list of
HTSUS Classifications in this table and
the HTSUS Classifications identified by
the ITC in the Harmonized Tariff
Schedule of the United States and the
associated Change Records, the ITC’s
list of HTSUS Classifications shall be
controlling. Therefore, if an HTSUS
Classification defining a GAE is split or
otherwise modified by the ITC in the
HTSUS, GAEs are extended to the
newly-created HTSUS Classification(s),
so long as the new ‘child’ HTSUS
Classification(s) contain products falling
entirely within the scope of the old
‘parent’ HTSUS classification. These
types of ‘inherited’ GAEs are effective
from the effective date of the change to
the HTSUS, even prior to a Commerce
rule being published to add the new
HTSUS number to the GAE list under
this supplement no. 3. During the period
after the effective date of the change to
the HTSUS and before the GAE is
updated, ACE will reject entries
claiming the exclusion with the new
HTSUS number and importers will have
to make entry without the exclusion. In
order for importers to preserve their
rights, if any, to the exclusion with the
new HTSUS number during this period,
importers are advised to seek extensions
of liquidation of the affected entries
with CBP until Commerce is able to
update and publish a revised GAE list
under this supplement no. 3.
Matthew S. Borman,
Deputy Assistant Secretary for Export
Administration.
[FR Doc. 2021–26634 Filed 12–8–21; 8:45 am]
BILLING CODE 3510–33–P
DEPARTMENT OF COMMERCE
Bureau of Industry and Security
15 CFR Parts 740, 742, and 744
[Docket No. 211201–0249]
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RIN 0694–AI65
Revision of Controls for Cambodia
Under the Export Administration
Regulations
Bureau of Industry and
Security, Commerce.
ACTION: Final rule.
AGENCY:
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70015
SUMMARY:
In response to deepening
Chinese military influence in Cambodia,
which undermines and threatens
regional security, as well as growing
corruption and human rights abuses by
the Government of Cambodia, in this
final rule, the Bureau of Industry and
Security (BIS) amends the Export
Administration Regulations (EAR) to
apply more restrictive treatment to
exports and reexports to, and transfers
within, Cambodia of items subject to the
EAR. BIS is taking this action to address
recent actions by the Government of
Cambodia that are contrary to the
national security and foreign policy
interests of the United States. Further,
BIS updates a Country Group
designation for Cambodia under the
EAR to reflect the country’s
identification by the State Department
as subject to a United States arms
embargo.
DATES: This rule is effective December 9,
2021.
FOR FURTHER INFORMATION CONTACT:
Tracy Patts, Foreign Policy Division,
Office of Nonproliferation and Treaty
Compliance, Bureau of Industry and
Security, U.S. Department of Commerce,
by email at Foreign.Policy@bis.doc.gov,
or by phone at 202–482–4252.
SUPPLEMENTARY INFORMATION:
Cambodian military officials due to
their involvement in significant
corruption, including in connection
with the Ream Naval Base. At that time,
State, Treasury, and the Department of
Commerce also issued an advisory
cautioning U.S. businesses regarding the
potential exposure to entities in
Cambodia, such as the Cambodian
military, that engage in human rights
abuses, corruption, and other
destabilizing conduct.
The United States has determined that
expanded Chinese military influence in
Cambodia and corruption and human
rights abuses committed by Cambodian
government actors, including the
Cambodian military, are contrary to U.S.
national security and foreign policy
interests. Therefore, the U.S.
Government is restricting certain
exports and reexports to, and transfers
within, Cambodia to ensure that items
subject to the EAR are not available to
Cambodia’s military and militaryintelligence services without prior
review by the U.S. Government, and is
also adding Cambodia to the list of
countries subject to a more stringent
review policy for license applications
involving national security-controlled
items. In this rule, BIS amends the EAR
to implement more restrictive treatment
for Cambodia under the EAR.
Background
Changes Made by This Rule for
Cambodia Under the EAR
BIS is taking this action to address
recent actions by the Government of
Cambodia that are contrary to the
national security and foreign policy
interests of the United States and
threaten regional security. The rule
makes four broad changes to the EAR to
reflect BIS’s more restrictive licensing
approach to Cambodia. It adds
Cambodia to: (1) The list of countries
subject to the licensing policy in
§ 742.4(b)(7), (2) the list of countries
subject to military end use and end user
controls in § 744.21, (3) the list of
countries subject to military intelligence
end use and end user controls in
§ 744.22, and (4) the list of countries
subject to a U.S. arms embargo under
Country Group D:5.
Cambodia Under the Export
Administration Regulations
BIS’s current licensing policy for
Cambodia dates from 1992, when the
agency amended the EAR in support of
the settlement of political conflict in
Cambodia and the lifting of a U.S. trade
embargo on Cambodia. (57 FR 11576,
April 6, 1992.) Recent changes in
Cambodian foreign policy, however,
undermine regional security as well as
U.S. national security and foreign policy
interests, and necessitate a revision to
export controls for Cambodia under the
EAR.
In June 2021, during an official visit
to Cambodia, Deputy Secretary of State
Wendy Sherman expressed serious
concerns about the People’s Republic of
China’s (PRC or China) military
presence and construction of facilities at
Ream Naval Base in Cambodia. Deputy
Secretary Sherman emphasized that an
exclusive-use PRC military base in
Cambodia would undermine Cambodian
sovereignty, threaten regional security,
and negatively impact U.S.-Cambodia
relations. Since then, the Department of
State (State) and the Treasury
(Treasury), have taken action under
their respective authorities to address
such concerns. In November 2021, State
and Treasury designated two
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Licensing Policy
This rule adds Cambodia to the list of
countries subject to the licensing policy
in § 742.4(b)(7) (NS-controlled items) of
the EAR. The license review policy for
NS-controlled items in § 742.4(b)(7)
applies to transactions with the
countries listed in § 744.21, and now
applies to Cambodia as well. This rule
removes the reference to Cambodia in
the policy described in § 742.4(b)(6),
which is superseded in this rule by the
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policy for Cambodia in paragraph
(b)(7)(i).
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Section 744.21
This rule adds Cambodia to the
countries subject to the ‘military end
use’ and ‘military end user’ (MEU)
restrictions in § 744.21 of the EAR. In
addition to the license requirements for
items specified on the Commerce
Control List (CCL), § 744.21 prohibits
the export, reexport, or transfer (incountry) without a license of items
subject to the EAR and are listed in
supplement no. 2 to part 744—List of
Items Subject to the Military End Use or
End User License Requirement of
§ 744.21—to Burma, China, the Russian
Federation, or Venezuela. With the
publication of this rule, Cambodia is
now added to the countries subject to
this license requirement. Such exports,
reexports, or transfers (in-country)
require a license if, at the time of the
export, reexport, or transfer (in-country),
the exporter, reexporter, or transferor
(in-country) has ‘‘knowledge,’’ as
defined in § 772.1 of the EAR that the
item is intended, entirely or in part, for
a ‘military end use,’ or ‘military end
user,’ in Burma, Cambodia, China, the
Russian Federation, or Venezuela.
Applications submitted for the export or
reexport to Cambodia, or transfer within
Cambodia, of an item in supplement no.
2 to part 744 under this section will be
reviewed with a presumption of denial.
This rule also adds a reference to
Cambodia in supplement no. 7 to part
744—‘Military End User’ List but does
not add any entities located in
Cambodia to the list of Military End
Users (MEU List). The MEU List notifies
the public that certain entities are
subject to the military end-user
prohibitions in § 744.21 of the EAR. BIS
may add entities located in Cambodia to
the MEU List in the future.
Section 744.22
This rule also adds Cambodia to the
countries subject to the ‘militaryintelligence end use’ and ‘militaryintelligence end user’ (MIEU)
restrictions in § 744.22 of the EAR. In
addition to the license requirements for
items specified on the CCL, § 744.22
prohibits the export, reexport, or
transfer (in-country) without a license of
items subject to the EAR to Burma,
China, the Russian Federation,
Venezuela, or a country listed in
Country Group E:1 or E:2. With the
publication of this rule, Cambodia is
now added to the countries subject to
this license requirement. Such exports,
reexports, or transfers (in-country)
require a license if, at the time of the
export, reexport, or transfer (in-country),
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the exporter, reexporter, or transferor
(in-country) has ‘‘knowledge,’’ as
defined in § 772.1 of the EAR that the
item is intended, entirely or in part, for
a ‘military-intelligence end use,’ or
‘military-intelligence end user,’ in
Burma, Cambodia, China, the Russian
Federation, Venezuela or the countries
listed in Country Group E:1 or E:2.
Applications submitted for the export or
reexport to Cambodia, or transfer within
Cambodia, of an EAR item under this
section will be reviewed with a
presumption of denial.
With this amendment to § 744.22 of
the EAR, BIS is also revising
§ 744.6(b)(5) of the EAR to restrict
specific activities of ‘‘U.S. persons’’ in
connection with a ‘military-intelligence
end use’ or ‘military-intelligence end
user’ in Cambodia.
Country Group D:5
The amendments in this rule are
made concurrent with other U.S.
Government actions intended to support
the revision of export control policy
toward Cambodia in light of the recent
developments in Cambodia. In
particular, the Department of State is
amending the International Traffic in
Arms Regulations (ITAR) § 126.1,
‘‘Prohibited Exports, Imports, and Sales
to or from Certain Countries’’ to add
Cambodia in the list of countries for
which it is the policy of the United
States to deny licenses and other
approvals for exports and imports of
defense articles and defense services.
This change reflects the policy of the
United States to deny licenses and other
approvals for the export and import of
defense articles and defense services
destined for or originating in Cambodia,
except as otherwise provided within the
ITAR.
BIS harmonizes the arms embargorelated provisions in the EAR with the
regulation of arms embargoes in § 126.1
of the ITAR. The ITAR list incorporates
countries subject to United Nations
Security Council (UNSC) and U.S. arms
embargoes. BIS primarily implements
such controls through Country Group
D:5 ‘‘U.S. Arms Embargoed Countries,’’
in supplement no. 1 to part 740 of the
EAR.
Countries listed in Country Group D:5
are subject to additional restrictions in
the EAR, including on de minimis U.S.
content, license exception availability,
and licensing policy for certain items.
For example, license applications for
the export or reexport of items classified
under 9x515 or ‘‘600 series’’ Export
Control Classification Numbers (ECCNs)
to countries in Country Group D:5 are
reviewed consistent with the policies in
§ 126.1 of the ITAR, as provided in
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paragraph (b)(1)(ii) of § 742.4 of the
EAR.
Therefore, BIS revises Country Group
D to add Cambodia to Country Group
D:5 consistent with the Department of
State’s amendment adding Cambodia to
ITAR § 126.1 on December 9, 2021.
Export Control Reform Act of 2018
On August 13, 2018, the President
signed into law the John S. McCain
National Defense Authorization Act for
Fiscal Year 2019, which included the
Export Control Reform Act of 2018
(ECRA) (50 U.S.C. 4801–4852) that
provides the legal basis for BIS’s
principal authorities and serves as the
authority under which BIS issues this
rule.
Rulemaking Requirements
1. Executive Orders 13563 and 12866
direct agencies to assess all costs and
benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, distribute impacts, and equity).
Executive Order 13563 emphasizes the
importance of quantifying both costs
and benefits, of reducing costs, of
harmonizing rules, and of promoting
flexibility. This final rule has been
designated to be a ‘‘significant
regulatory action,’’ although not
economically significant, under section
3(f) of Executive Order 12866.
2. This rule does not contain policies
with federalism implications as that
term is defined under Executive Order
13132.
3. Pursuant to section 1762 of the
Export Control Reform Act of 2018 (50
U.S.C. 4821), this action is exempt from
the Administrative Procedure Act (5
U.S.C. 553) requirements for notice of
proposed rulemaking, opportunity for
public participation, and delay in
effective date.
4. 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. Accordingly, no
regulatory flexibility analysis is required
and none has been prepared.
5. Notwithstanding any other
provision of law, no person may be
required to respond to or 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
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information displays a currently valid
Office of Management and Budget
(OMB) Control Number. This regulation
involves a collection currently approved
by OMB under control number 0694–
0088, Simplified Network Application
Processing System. The collection
includes, among other things, license
applications, and carries a burden
estimate of 42.5 minutes for a manual or
electronic submission for a total burden
estimate of 31,878 hours. BIS expects
the burden hours associated with this
collection to not significantly increase
with the publication of this rule.
Savings Clause
Shipments of items that may no
longer be made under No License
Required (NLR) or license exception as
a result of this action and were on dock
for loading, on lighter, laden aboard an
exporting or transferring carrier, or en
route aboard a carrier to a port of export
or reexport on January 10, 2022,
pursuant to actual orders for export to
Cambodia, reexport to Cambodia, or
transfer (in country) within Cambodia
may proceed to their destination under
the prior authorization.
List of Subjects
Regulations (15 CFR parts 730–774) are
amended as follows:
PART 740—[AMENDED]
1. The authority citation for part 740
continues to read as follows:
■
Authority: 50 U.S.C. 4801–4852; 50 U.S.C.
4601 et seq.; 50 U.S.C. 1701 et seq.; 22 U.S.C.
7201 et seq.; E.O. 13026, 61 FR 58767, 3 CFR,
1996 Comp., p. 228; E.O. 13222, 66 FR 44025,
3 CFR, 2001 Comp., p. 783.
15 CFR Part 740
Administrative practice and
procedure, Exports, Reporting and
recordkeeping requirements.
2. Supplement no. 1 to part 740 is
amended in the Country Group D table
by revising the entry for ‘‘Cambodia’’
and note 1 to the table to read as
follows:
■
15 CFR Part 742
Exports, Terrorism.
15 CFR Part 744
Exports, Reporting and recordkeeping
requirements, Terrorism.
Accordingly, parts 740, 742, and 744
of the Export Administration
Supplement No. 1 to Part 740—Country
Groups
*
*
*
*
*
COUNTRY GROUP D
[D:1]
National
security
Country
*
*
*
Cambodia .............................................................................
*
*
*
*
X
[D:3]
Chemical &
biological
[D:2]
Nuclear
*
........................ ........................
*
*
[D:4]
Missile
technology
*
........................
*
[D:5]
U.S. arms
embargoed
countries 1
*
X
*
1 Note
to Country Group D:5: Countries subject to U.S. arms embargoes are identified by the State Department through notices published in
the Federal Register. The list of arms embargoed destinations in this table is drawn from 22 CFR 126.1 and State Department Federal Register notices related to arms embargoes (compiled and accessible at https://www.pmddtc.state.gov) and will be amended when the State Department publishes subsequent notices. If there are any discrepancies between the list of countries in this table and the countries identified by the
State Department as subject to a U.S. arms embargo (in the Federal Register), the State Department’s list of countries subject to U.S. arms
embargoes shall be controlling.
*
*
*
*
*
PART 742—[AMENDED]
3. The authority citation for part 742
continues to read as follows:
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■
Authority: 50 U.S.C. 4801–4852; 50 U.S.C.
4601 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; Sec. 1503, Pub. L.
108–11, 117 Stat. 559; 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. 13026, 61 FR 58767, 3
CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR
44025, 3 CFR, 2001 Comp., p. 783;
Presidential Determination 2003–23, 68 FR
26459, 3 CFR, 2004 Comp., p. 320; Notice of
November 12, 2020, 85 FR 72897 (November
13, 2020).
4. Section 742.4 is amended by
revising paragraphs (b)(6) and (7) to read
as follows:
■
§ 742.4
*
National security.
*
*
(b) * * *
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(6) The general policy for Laos is to
approve license applications when BIS
determines, on a case-by-case basis, that
the items are for an authorized use in
Laos and are not likely to be diverted to
another country or use contrary to the
national security or foreign policy
controls of the Unied States.
(7)(i) For Burma, Cambodia, the
People’s Republic of China (China), the
Russian Federation, and Venezuela, all
applications will be reviewed to
determine the risk of diversion to a
military end user or military end use.
There is a general policy of approval for
license applications to export, reexport,
or transfer items determined to be for
civil end users for civil end uses. There
is a presumption of denial for license
applications to export, reexport, or
transfer items that would make a
material contribution to the
‘‘development,’’ ‘‘production,’’
maintenance, repair, or operation of
weapons systems, subsystems, and
assemblies, such as, but not limited to,
those described in supplement no. 7 to
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this part, of Burma, Cambodia, China,
the Russian Federation, or Venezuela.
(ii) The following factors are among
those that will be considered in
reviewing license applications
described in paragraph (b)(7)(i) of this
section:
(A) The appropriateness of the export,
reexport, or transfer for the stated end
use;
(B) The significance of the item for the
weapon systems capabilities of the
importing country;
(C) Whether any party is a ‘military
end user’ as defined in § 744.21(g) of the
EAR;
(D) The reliability of the parties to the
transaction, including whether:
(1) An export or reexport license
application has previously been denied;
(2) Any parties are or have been
engaged in unlawful procurement or
diversion activities;
(3) The parties are capable of securely
handling and storing the items; and
(4) End-use checks have been and
may be conducted by BIS or another
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U.S. Government agency on parties to
the transaction;
(E) The involvement of any party to
the transaction in military activities,
including activities involving the
‘‘development,’’ ‘‘production,’’
maintenance, repair, or operation of
weapons systems, subsystems, and
assemblies;
(F) Government strategies and policies
that support the diversion of exports
from their stated civil end use and
redirection towards military end use;
and
(G) The scope and effectiveness of the
export control system in the importing
country.
(iii) The review will also include an
assessment of the impact of a proposed
export of an item on the United States
defense industrial base and the denial of
an application for a license that would
have a significant negative impact, as
defined in section 1756(d)(3) of the
Export Control Reform Act of 2018 (50
U.S.C. 4815(d)(3)), on such defense
industrial base.
*
*
*
*
*
PART 744—[AMENDED]
5. The authority citation for part 744
continues to read as follows:
■
Authority: 50 U.S.C. 4801–4852; 50 U.S.C.
4601 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. 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 September 15, 2021,
86 FR 52069 (September 17, 2021); Notice of
November 10, 2021, 86 FR 62891 (November
12, 2021).
6. Section 744.6 is amended by
revising paragraph (b)(5) to read as
follows:
■
§ 744.6 Restrictions on specific activities
of ‘‘U.S. persons.’’
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*
*
*
*
*
(b) * * *
(5) A ‘military-intelligence end use’ or
a ‘military-intelligence end user,’ as
defined in § 744.22(f), in Burma,
Cambodia, the People’s Republic of
China, Russia, or Venezuela; or a
country listed in Country Groups E:1 or
E:2 (see supplement no. 1 to part 740 of
the EAR).
*
*
*
*
*
■ 7. Section 744.21 is revised to read as
follows:
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§ 744.21 Restrictions on Certain ‘military
end use’ or ‘military end user’ in Burma,
Cambodia, the People’s Republic of China,
the Russian Federation, or Venezuela.
(a) General prohibition. In addition to
the license requirements for items
specified on the Commerce Control List
(CCL) (supplement no. 1 to part 774 of
the EAR), you may not export, reexport,
or transfer (in-country) any item subject
to the EAR listed in supplement no. 2
to this part to Burma, Cambodia, the
People’s Republic of China (China), the
Russian Federation, or Venezuela
without a license if, at the time of the
export, reexport, or transfer (in-country),
you have ‘‘knowledge,’’ as defined in
§ 772.1 of the EAR, that the item is
intended, entirely or in part, for a
‘military end use,’ as defined in
paragraph (f) of this section, or ‘military
end user,’ as defined in paragraph (g) of
this section, in Burma, Cambodia,
China, the Russian Federation, or
Venezuela.
(b) Additional prohibition on those
informed by BIS. BIS may inform you
either individually by specific notice,
through amendment to the EAR
published in the Federal Register, or
through a separate notification
published in the Federal Register, that
a license is required for specific exports,
reexports, or transfers (in-country) of
any item because there is an
unacceptable risk of use in or diversion
to a ‘military end use’ or ‘military end
user’ in Burma, Cambodia, China, the
Russian Federation, or Venezuela.
Specific notice will be given only by, or
at the direction of, the Deputy Assistant
Secretary for Export Administration.
When such notice is provided orally, it
will be followed by written notice
within two working days signed by the
Deputy Assistant Secretary for Export
Administration or the Deputy Assistant
Secretary’s designee. The absence of BIS
notification does not excuse the
exporter from compliance with the
license requirements of paragraph (a) of
this section.
(1) ‘Military End-User’ (MEU) List. BIS
may inform and provide notice to the
public that certain entities are subject to
the additional prohibition described
under this paragraph (b) following a
determination by the End-User Review
Committee (ERC) that a specific entity is
a ‘military end user’ pursuant to this
section and therefore any exports,
reexports, or transfers (in-country) to
that entity represent an unacceptable
risk of use in or diversion to a ‘military
end use’ or ‘military end user’ in Burma,
Cambodia, China, the Russian
Federation, or Venezuela. Such entities
may be added to supplement no. 7 to
this part—‘Military End-User’ (MEU)
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List through Federal Register
notifications published by BIS and will
thus be subject to a license requirement
for exports, reexports, or transfers (incountry) of items specified in
supplement no. 2 to this part. The
listing of entities under supplement no.
7 to this part is not an exhaustive listing
of ‘military end users’ for purposes of
this section. Exporters, reexporters, and
transferors are responsible for
determining whether transactions with
entities not listed on supplement no. 7
to this part are subject to a license
requirement under paragraph (a) of this
section. The process in this paragraph
(b)(1) for placing entities on the MEU
List is only one method BIS may use to
inform exporters, reexporters, and
transferors of license requirements
under this section.
(i) End-User Review Committee (ERC).
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 other modifications to
the MEU List. Decisions by the ERC for
purposes of the MEU List will be made
following the procedures identified in
this section and in supplement no. 5 to
this part—Procedures for End-User
Review Committee Entity List and
‘Military End User’ (MEU) List
Decisions.
(ii) License requirement for parties to
the transaction. The license requirement
for entities listed in supplement no. 7 to
this part applies to the export, reexport,
or transfer (in-country) of any item
subject to the EAR listed in supplement
no. 2 to this part when an entity that is
listed on the MEU List is a party to the
transaction as described in § 748.5(c)
through (f) of the EAR.
(2) Requests for removal from or
modification of ‘Military End-User’
(MEU) List. Any entity listed on the
MEU List may request that its listing be
removed or modified. All such requests,
including reasons therefor, must be in
writing and sent to: Chair, End-User
Review Committee, Bureau of Industry
and Security, U.S. Department of
Commerce, 14th Street and
Pennsylvania Avenue NW, Room 3886,
Washington, DC 20230; or by email at
ERC@bis.doc.gov. In order for an entity
listed on the MEU List to petition BIS
for their removal or modification, as
applicable, the entity must address why
the entity is not a ‘military end user’ for
purposes of this section.
(i) Review. The ERC will review such
requests for removal or modification in
accordance with the procedures set
forth in supplement no. 5 to this part.
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(ii) BIS action. The Deputy Assistant
Secretary for Export Administration will
convey the decision on the request to
the requester in writing. That decision
will be the final agency action on the
request.
(c) License exception. Despite the
prohibitions described in paragraphs (a)
and (b) of this section, you may export,
reexport, or transfer (in-country) items
subject to the EAR under the provisions
of License Exception GOV set forth in
§ 740.11(b)(2)(i) and (ii) of the EAR.
(d) License application procedure.
When submitting a license application
pursuant to this section, you must state
in the ‘‘additional information’’ block of
the application that ‘‘this application is
submitted because of the license
requirement in § 744.21 of the EAR
(Restrictions on a ‘Military End Use’ or
‘Military End User’ in Burma,
Cambodia, the People’s Republic of
China, the Russian Federation, or
Venezuela).’’ In addition, either in the
additional information block of the
application or in an attachment to the
application, you must include all
known information concerning the
‘military end use’ and ‘military end
user(s)’ of the item(s). If you submit an
attachment with your license
application, you must reference the
attachment in the ‘‘additional
information’’ block of the application.
(e) License review standards. (1)
Applications to export, reexport, or
transfer (in-country) items described in
paragraph (a) of this section will be
reviewed with a presumption of denial.
(2) Applications may be reviewed
under chemical and biological weapons,
nuclear nonproliferation, or missile
technology review policies, as set forth
in §§ 742.2(b)(4), 742.3(b)(4), and
742.5(b)(4) of the EAR, if the end use
may involve certain proliferation
activities.
(3) Applications for items requiring a
license for any reason that are destined
to Burma, Cambodia, China, the Russian
Federation, or Venezuela for a ‘military
end use’ or ‘military end user’ also will
be subject to the review policy stated in
paragraph (e)(1) of this section.
(f) Military end use. In this section,
‘military end use’ means: Incorporation
into a military item described on the
U.S. Munitions List (USML) (22 CFR
part 121, International Traffic in Arms
Regulations); incorporation into items
classified under Export Control
Classification Numbers (ECCNs) ending
in ‘‘A018’’ or under ‘‘600 series’’ ECCNs;
or any item that supports or contributes
to the operation, installation,
maintenance, repair, overhaul,
refurbishing, ‘‘development,’’ or
‘‘production,’’ of military items
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described on the USML, or items
classified under ECCNs ending in
‘‘A018’’ or under ‘‘600 series’’ ECCNs.
(g) Military end user. In this section,
the term ‘military end user’ means the
national armed services (army, navy,
marine, air force, or coast guard), as well
as the national guard and national
police, government intelligence or
reconnaissance organizations, or any
person or entity whose actions or
functions are intended to support
‘military end uses’ as defined in
paragraph (f) of this section.
(h) Effects on contracts. Venezuela:
Transactions involving the export,
reexport, or transfer (in country) of
items to or within Venezuela are not
subject to the provisions of this section
if the contracts for such transactions
were signed prior to November 7, 2014.
■ 8. Section 744.22 is revised to read as
follows:
§ 744.22 Restrictions on exports,
reexports, and transfers (in-country) to
certain military-intelligence end uses or end
users.
(a) General prohibition. In addition to
the license requirements for items
specified on the Commerce Control List
(CCL) (supplement no. 1 to part 774 of
the EAR), you may not export, reexport,
or transfer (in-country) any item subject
to the EAR without a license from BIS
if, at the time of the export, reexport, or
transfer (in-country), you have
‘‘knowledge’’ that the item is intended,
entirely or in part, for a ‘militaryintelligence end use’ or a ‘militaryintelligence end user’ in Burma,
Cambodia, the People’s Republic of
China (China), Russia, or Venezuela; or
a country listed in Country Groups E:1
or E:2 (see supplement no. 1 to part 740
of the EAR).
(b) Additional prohibition on those
informed by BIS. BIS may inform you
either individually by specific notice,
through amendment to the EAR
published in the Federal Register, or
through a separate notification
published in the Federal Register, that
a license is required for specific exports,
reexports, or transfers (in-country) of
any item subject to the EAR because
there is an unacceptable risk of use in,
or diversion to, a ‘military-intelligence
end use’ or a ‘military-intelligence end
user’ in Burma, Cambodia, China,
Russia, or Venezuela; or a country listed
in Country Group E:1 or E:2 (see
supplement no. 1 to part 740 of the
EAR).
(c) License exception.
Notwithstanding the prohibitions
described in paragraphs (a) and (b) of
this section, you may export, reexport,
or transfer (in-country) items subject to
PO 00000
Frm 00043
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Sfmt 4700
70019
the EAR under the provision of License
Exception GOV set forth in
§ 740.11(b)(2)(ii) of the EAR.
(d) License application procedure.
When submitting a license application
pursuant to this section, you must state
in the ‘‘additional information’’ block of
the application that ‘‘this application is
submitted because of the license
requirement in § 744.22 of the EAR
(Restrictions on exports, reexports, and
transfers (in-country) to certain militaryintelligence end uses or end users).’’ In
addition, either in the additional
information block of the application or
in an attachment to the application, you
must include all known information
concerning the military-intelligence end
use(s) or end user(s) of the item(s). If
you submit an attachment with your
license application, you must reference
the attachment in the ‘‘additional
information’’ block of the application.
(e) License review policy.
Applications to export, reexport, or
transfer (in-country) items requiring a
license pursuant to paragraph (a) or (b)
of this section will be reviewed with a
presumption of denial.
(f) Definitions. (1) ‘Militaryintelligence end use’ means the
‘‘development,’’ ‘‘production,’’
operation, installation (including on-site
installation), maintenance (checking),
repair, overhaul, or refurbishing of, or
incorporation into, items described on
the U.S. Munitions List (USML) (22 CFR
part 121, International Traffic in Arms
Regulations), or classified under ECCNs
ending in ‘‘A018’’ or under ‘‘600 series’’
ECCNs, which are intended to support
the actions or functions of a ‘militaryintelligence end user,’ as defined in this
section.
(2) ‘Military-intelligence end user’
means any intelligence or
reconnaissance organization of the
armed services (army, navy, marine, air
force, or coast guard); or national guard.
For license requirements applicable to
other government intelligence or
reconnaissance organizations in Burma,
Cambodia, China, Russia, or Venezuela,
see § 744.21. Military-intelligence end
users subject to the license requirements
set forth in this section include, but are
not limited to, the following:
(i) Burma. Office of Chief of Military
Security Affairs (OCMSA) and the
Directorate of Signal.
(ii) Cambodia. General Department of
Research and Intelligence (GDRI).
(iii) Cuba. Directorate of Military
Intelligence (DIM) and Directorate of
Military Counterintelligence (CIM).
(iv) China, People’s Republic of.
Intelligence Bureau of the Joint Staff
Department.
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(v) Iran. Islamic Revolutionary Guard
Corps Intelligence Organization (IRGC–
IO) and Artesh Directorate for
Intelligence (J2).
(vi) Korea, North. Reconnaissance
General Bureau (RGB).
(vii) Russia. Main Intelligence
Directorate (GRU).
(viii) Syria. Military Intelligence
Service.
(ix) Venezuela. General Directorate of
Military Counterintelligence (DGCIM).
■ 9. Supplement No.7 to part 744 is
amended in the table by adding in
alphabetical order an entry for
‘‘CAMBODIA’’ to read as follows:
Supplement No. 7 to Part 744—
’Military End-User’ (MEU) List
*
*
*
*
Country
Federal
Register
citation
Entity
*
*
Cambodia ......
*
*
*
*
*
[Reserved] ... [Reserved]
*
*
*
*
Matthew S. Borman,
Deputy Assistant Secretary for Export
Administration.
[FR Doc. 2021–26633 Filed 12–8–21; 8:45 am]
BILLING CODE 3510–33–P
FEDERAL TRADE COMMISSION
16 CFR Part 313
RIN 3084–AB42
Privacy of Consumer Financial
Information Rule Under the GrammLeach-Bliley Act
Federal Trade Commission.
Final rule.
AGENCY:
ACTION:
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I. Background
A. The Statute and Regulation
The GLBA was enacted in 1999.1 The
GLBA, among other things, requires that
financial institutions provide their
customers with initial and annual
notices regarding their privacy
practices, and allow their customers to
opt out of sharing their information with
certain nonaffiliated third parties.
Rulemaking authority to implement
the GLBA’s privacy provisions was
initially spread among multiple
agencies. The Federal Reserve Board
(‘‘the Fed’’), the Office of Comptroller of
the Currency (‘‘OCC’’), the Federal
Deposit Insurance Corporation
(‘‘FDIC’’), and the Office of Thrift
Supervision (‘‘OTS’’) jointly adopted
final rules to implement the notice and
opt-out requirements of the GLBA in
2000.2 The Commission, the National
Credit Union Administration (‘‘NCUA’’),
the Securities and Exchange
Commission (‘‘SEC’’), and the
Commodity Futures Trading
Commission (‘‘CFTC’’) were part of the
same interagency process, but each
issued their rules separately.3 In 2009,
all those agencies jointly adopted a
model form financial institutions could
use to provide the required initial and
annual privacy disclosures.4
As originally promulgated, the FTC’s
Privacy Rule covered a broad range of
1 Public
The Federal Trade
Commission is amending its Privacy
Rule to revise the rule’s scope, to
modify the rule’s definitions of
‘‘financial institution’’ and ‘‘Federal
functional regulator,’’ and to update the
rule’s annual customer privacy notice
requirement. The amendments also
remove certain examples in the rule that
apply to financial institutions that now
fall outside its scope. This action is
necessary to conform the rule to the
current requirements of the GrammLeach-Bliley Act (‘‘GLBA’’), as amended
by the Dodd-Frank and FAST Acts, and
the Commission’s revisions to the
Safeguards Rule, which are being
announced simultaneously through a
separate document published elsewhere
in this issue of the Federal Register.
SUMMARY:
The amendments are effective
January 10, 2022.
FOR FURTHER INFORMATION CONTACT:
David Lincicum (202–326–2773),
Division of Privacy and Identity
Protection, Bureau of Consumer
Protection, Federal Trade Commission,
600 Pennsylvania Avenue NW,
Washington, DC 20580.
SUPPLEMENTARY INFORMATION:
DATES:
Law 106–102, 113 Stat. 1338 (1999).
Final Rule, 65 FR 35162 (June 1, 2000)
available at https://www.federalregister.gov/
documents/2001/04/27/01-10398/privacy-ofconsumer-financial-information.
3 FTC Final Privacy Rule, 65 FR 33645 (May 24,
2000) available at https://www.federalregister.gov/
documents/2000/05/24/00-12755/privacy-ofconsumer-financial-information; NCUA Final
Privacy Rule, 65 FR 31722 (May 18, 2000) available
at https://www.federalregister.gov/documents/2000/
05/18/00-12014/privacy-of-consumer-financialinformation-requirements-for-insurance; SEC Final
Privacy Rule, 65 FR 40333 (June 29, 2000) available
at https://www.federalregister.gov/documents/2000/
06/29/00-16269/privacy-of-consumer-financialinformation-regulation-s-p; CFTC Final Privacy
Rule, 66 FR 21235 (Apr. 27, 2001) available at
https://www.federalregister.gov/documents/2001/
04/27/01-10398/privacy-of-consumer-financialinformation.
4 Joint Model Form, 74 FR 62889 (Dec. 1, 2009)
available at https://www.federalregister.gov/
documents/2009/12/01/E9-27882/final-modelprivacy-form-under-the-gramm-leach-bliley-act; see
also 16 CFR 313.2, 16 CFR 313.4 through 313.9.
2 Joint
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non-bank financial institutions such as
payday lenders, mortgage brokers, check
cashers, debt collectors, real estate
appraisers, certain motor vehicle
dealers, and remittance transfer
providers. In 2010, the Dodd-Frank Act 5
transferred the majority of GLBA’s
privacy rulemaking authority from the
Fed, NCUA, OCC, OTS, FDIC, and the
Commission (in part) to the Consumer
Financial Protection Bureau (‘‘CFPB’’).
The CFPB then restated the
implementing regulations in Regulation
P, 12 CFR part 1016, in late 2011
(‘‘Regulation P’’).6 However, under
section 1029 of the Dodd-Frank Act, the
Commission retained rulemaking
authority for certain motor vehicle
dealers.7 Thus, in 2012, the Commission
announced it was retaining the
implementing regulations governing
privacy notices for motor vehicle
dealers at 16 CFR part 313.8
Despite the transfer of general
rulemaking authority for the Privacy
Rule to the CFPB, the Commission and
other agencies retain their existing
enforcement authority under the
GLBA.9 In addition, the SEC and CFTC
retain rulemaking authority with respect
to securities and futures-related
companies, respectively.10 Accordingly,
as part of this rulemaking process, the
Commission has consulted and
coordinated, or offered to consult, with
those agencies that have rulemaking
and/or enforcement authority under the
GLBA, including the CFPB, SEC, CFTC,
and the National Association of
Insurance Commissioners (‘‘NAIC’’).11
On December 4, 2015, Congress
amended the GLBA as part of the FAST
Act. This amendment, titled Eliminate
Privacy Notice Confusion,12 added
GLBA subsection 503(f). This subsection
5 Public
Law 111–203, 124 Stat. 1376 (2010).
Final Rule for Regulation P, 76 FR 79025
(Dec. 21, 2011) available at https://
www.federalregister.gov/documents/2011/12/21/
2011-31729/privacy-of-consumer-financialinformation-regulation-p.
7 12 U.S.C. 5519. The FTC retained rulemaking
jurisdiction as to motor vehicle dealers that are
predominantly engaged in the sale and servicing or
the leasing and servicing of motor vehicles,
excluding those dealers that directly extend credit
to consumers and do not routinely assign the
extensions of credit to an unaffiliated third party.
For ease of reference, covered motor vehicle dealers
are referenced herein as ‘‘motor vehicle dealers.’’
8 Rescission of Rules, 77 FR 22200, 22201 (Apr.
13, 2012) available at https://
www.federalregister.gov/documents/2012/04/13/
2012-8748/rescission-of-rules (also rescinding those
regulations for which rulemaking authority was
transferred to the CFPB under the Dodd-Frank Act).
9 15 U.S.C. 6805(a).
10 15 U.S.C. 6804, 6809; 12 U.S.C. 1843(k)(4); 12
CFR 1016.1(b).
11 See 15 U.S.C. 6804(a)(2).
12 Section 75001, Public Law 114–94, 129 Stat.
1312, 1787 (2015).
6 Interim
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]]>Agencies
[Federal Register Volume 86, Number 234 (Thursday, December 9, 2021)]
[Rules and Regulations]
[Pages 70015-70020]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-26633]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
Bureau of Industry and Security
15 CFR Parts 740, 742, and 744
[Docket No. 211201-0249]
RIN 0694-AI65
Revision of Controls for Cambodia Under the Export Administration
Regulations
AGENCY: Bureau of Industry and Security, Commerce.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: In response to deepening Chinese military influence in
Cambodia, which undermines and threatens regional security, as well as
growing corruption and human rights abuses by the Government of
Cambodia, in this final rule, the Bureau of Industry and Security (BIS)
amends the Export Administration Regulations (EAR) to apply more
restrictive treatment to exports and reexports to, and transfers
within, Cambodia of items subject to the EAR. BIS is taking this action
to address recent actions by the Government of Cambodia that are
contrary to the national security and foreign policy interests of the
United States. Further, BIS updates a Country Group designation for
Cambodia under the EAR to reflect the country's identification by the
State Department as subject to a United States arms embargo.
DATES: This rule is effective December 9, 2021.
FOR FURTHER INFORMATION CONTACT: Tracy Patts, Foreign Policy Division,
Office of Nonproliferation and Treaty Compliance, Bureau of Industry
and Security, U.S. Department of Commerce, by email at
[email protected], or by phone at 202-482-4252.
SUPPLEMENTARY INFORMATION:
Background
Cambodia Under the Export Administration Regulations
BIS's current licensing policy for Cambodia dates from 1992, when
the agency amended the EAR in support of the settlement of political
conflict in Cambodia and the lifting of a U.S. trade embargo on
Cambodia. (57 FR 11576, April 6, 1992.) Recent changes in Cambodian
foreign policy, however, undermine regional security as well as U.S.
national security and foreign policy interests, and necessitate a
revision to export controls for Cambodia under the EAR.
In June 2021, during an official visit to Cambodia, Deputy
Secretary of State Wendy Sherman expressed serious concerns about the
People's Republic of China's (PRC or China) military presence and
construction of facilities at Ream Naval Base in Cambodia. Deputy
Secretary Sherman emphasized that an exclusive-use PRC military base in
Cambodia would undermine Cambodian sovereignty, threaten regional
security, and negatively impact U.S.-Cambodia relations. Since then,
the Department of State (State) and the Treasury (Treasury), have taken
action under their respective authorities to address such concerns. In
November 2021, State and Treasury designated two Cambodian military
officials due to their involvement in significant corruption, including
in connection with the Ream Naval Base. At that time, State, Treasury,
and the Department of Commerce also issued an advisory cautioning U.S.
businesses regarding the potential exposure to entities in Cambodia,
such as the Cambodian military, that engage in human rights abuses,
corruption, and other destabilizing conduct.
The United States has determined that expanded Chinese military
influence in Cambodia and corruption and human rights abuses committed
by Cambodian government actors, including the Cambodian military, are
contrary to U.S. national security and foreign policy interests.
Therefore, the U.S. Government is restricting certain exports and
reexports to, and transfers within, Cambodia to ensure that items
subject to the EAR are not available to Cambodia's military and
military-intelligence services without prior review by the U.S.
Government, and is also adding Cambodia to the list of countries
subject to a more stringent review policy for license applications
involving national security-controlled items. In this rule, BIS amends
the EAR to implement more restrictive treatment for Cambodia under the
EAR.
Changes Made by This Rule for Cambodia Under the EAR
BIS is taking this action to address recent actions by the
Government of Cambodia that are contrary to the national security and
foreign policy interests of the United States and threaten regional
security. The rule makes four broad changes to the EAR to reflect BIS's
more restrictive licensing approach to Cambodia. It adds Cambodia to:
(1) The list of countries subject to the licensing policy in Sec.
742.4(b)(7), (2) the list of countries subject to military end use and
end user controls in Sec. 744.21, (3) the list of countries subject to
military intelligence end use and end user controls in Sec. 744.22,
and (4) the list of countries subject to a U.S. arms embargo under
Country Group D:5.
Licensing Policy
This rule adds Cambodia to the list of countries subject to the
licensing policy in Sec. 742.4(b)(7) (NS-controlled items) of the EAR.
The license review policy for NS-controlled items in Sec. 742.4(b)(7)
applies to transactions with the countries listed in Sec. 744.21, and
now applies to Cambodia as well. This rule removes the reference to
Cambodia in the policy described in Sec. 742.4(b)(6), which is
superseded in this rule by the
[[Page 70016]]
policy for Cambodia in paragraph (b)(7)(i).
Section 744.21
This rule adds Cambodia to the countries subject to the `military
end use' and `military end user' (MEU) restrictions in Sec. 744.21 of
the EAR. In addition to the license requirements for items specified on
the Commerce Control List (CCL), Sec. 744.21 prohibits the export,
reexport, or transfer (in-country) without a license of items subject
to the EAR and are listed in supplement no. 2 to part 744--List of
Items Subject to the Military End Use or End User License Requirement
of Sec. 744.21--to Burma, China, the Russian Federation, or Venezuela.
With the publication of this rule, Cambodia is now added to the
countries subject to this license requirement. Such exports, reexports,
or transfers (in-country) require a license if, at the time of the
export, reexport, or transfer (in-country), the exporter, reexporter,
or transferor (in-country) has ``knowledge,'' as defined in Sec. 772.1
of the EAR that the item is intended, entirely or in part, for a
`military end use,' or `military end user,' in Burma, Cambodia, China,
the Russian Federation, or Venezuela. Applications submitted for the
export or reexport to Cambodia, or transfer within Cambodia, of an item
in supplement no. 2 to part 744 under this section will be reviewed
with a presumption of denial.
This rule also adds a reference to Cambodia in supplement no. 7 to
part 744--`Military End User' List but does not add any entities
located in Cambodia to the list of Military End Users (MEU List). The
MEU List notifies the public that certain entities are subject to the
military end-user prohibitions in Sec. 744.21 of the EAR. BIS may add
entities located in Cambodia to the MEU List in the future.
Section 744.22
This rule also adds Cambodia to the countries subject to the
`military-intelligence end use' and `military-intelligence end user'
(MIEU) restrictions in Sec. 744.22 of the EAR. In addition to the
license requirements for items specified on the CCL, Sec. 744.22
prohibits the export, reexport, or transfer (in-country) without a
license of items subject to the EAR to Burma, China, the Russian
Federation, Venezuela, or a country listed in Country Group E:1 or E:2.
With the publication of this rule, Cambodia is now added to the
countries subject to this license requirement. Such exports, reexports,
or transfers (in-country) require a license if, at the time of the
export, reexport, or transfer (in-country), the exporter, reexporter,
or transferor (in-country) has ``knowledge,'' as defined in Sec. 772.1
of the EAR that the item is intended, entirely or in part, for a
`military-intelligence end use,' or `military-intelligence end user,'
in Burma, Cambodia, China, the Russian Federation, Venezuela or the
countries listed in Country Group E:1 or E:2. Applications submitted
for the export or reexport to Cambodia, or transfer within Cambodia, of
an EAR item under this section will be reviewed with a presumption of
denial.
With this amendment to Sec. 744.22 of the EAR, BIS is also
revising Sec. 744.6(b)(5) of the EAR to restrict specific activities
of ``U.S. persons'' in connection with a `military-intelligence end
use' or `military-intelligence end user' in Cambodia.
Country Group D:5
The amendments in this rule are made concurrent with other U.S.
Government actions intended to support the revision of export control
policy toward Cambodia in light of the recent developments in Cambodia.
In particular, the Department of State is amending the International
Traffic in Arms Regulations (ITAR) Sec. 126.1, ``Prohibited Exports,
Imports, and Sales to or from Certain Countries'' to add Cambodia in
the list of countries for which it is the policy of the United States
to deny licenses and other approvals for exports and imports of defense
articles and defense services. This change reflects the policy of the
United States to deny licenses and other approvals for the export and
import of defense articles and defense services destined for or
originating in Cambodia, except as otherwise provided within the ITAR.
BIS harmonizes the arms embargo-related provisions in the EAR with
the regulation of arms embargoes in Sec. 126.1 of the ITAR. The ITAR
list incorporates countries subject to United Nations Security Council
(UNSC) and U.S. arms embargoes. BIS primarily implements such controls
through Country Group D:5 ``U.S. Arms Embargoed Countries,'' in
supplement no. 1 to part 740 of the EAR.
Countries listed in Country Group D:5 are subject to additional
restrictions in the EAR, including on de minimis U.S. content, license
exception availability, and licensing policy for certain items. For
example, license applications for the export or reexport of items
classified under 9x515 or ``600 series'' Export Control Classification
Numbers (ECCNs) to countries in Country Group D:5 are reviewed
consistent with the policies in Sec. 126.1 of the ITAR, as provided in
paragraph (b)(1)(ii) of Sec. 742.4 of the EAR.
Therefore, BIS revises Country Group D to add Cambodia to Country
Group D:5 consistent with the Department of State's amendment adding
Cambodia to ITAR Sec. 126.1 on December 9, 2021.
Export Control Reform Act of 2018
On August 13, 2018, the President signed into law the John S.
McCain National Defense Authorization Act for Fiscal Year 2019, which
included the Export Control Reform Act of 2018 (ECRA) (50 U.S.C. 4801-
4852) that provides the legal basis for BIS's principal authorities and
serves as the authority under which BIS issues this rule.
Rulemaking Requirements
1. Executive Orders 13563 and 12866 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distribute impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, of reducing costs, of harmonizing rules, and of promoting
flexibility. This final rule has been designated to be a ``significant
regulatory action,'' although not economically significant, under
section 3(f) of Executive Order 12866.
2. This rule does not contain policies with federalism implications
as that term is defined under Executive Order 13132.
3. Pursuant to section 1762 of the Export Control Reform Act of
2018 (50 U.S.C. 4821), this action is exempt from the Administrative
Procedure Act (5 U.S.C. 553) requirements for notice of proposed
rulemaking, opportunity for public participation, and delay in
effective date.
4. 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.
Accordingly, no regulatory flexibility analysis is required and none
has been prepared.
5. Notwithstanding any other provision of law, no person may be
required to respond to or 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
[[Page 70017]]
information displays a currently valid Office of Management and Budget
(OMB) Control Number. This regulation involves a collection currently
approved by OMB under control number 0694-0088, Simplified Network
Application Processing System. The collection includes, among other
things, license applications, and carries a burden estimate of 42.5
minutes for a manual or electronic submission for a total burden
estimate of 31,878 hours. BIS expects the burden hours associated with
this collection to not significantly increase with the publication of
this rule.
Savings Clause
Shipments of items that may no longer be made under No License
Required (NLR) or license exception as a result of this action and were
on dock for loading, on lighter, laden aboard an exporting or
transferring carrier, or en route aboard a carrier to a port of export
or reexport on January 10, 2022, pursuant to actual orders for export
to Cambodia, reexport to Cambodia, or transfer (in country) within
Cambodia may proceed to their destination under the prior
authorization.
List of Subjects
15 CFR Part 740
Administrative practice and procedure, Exports, Reporting and
recordkeeping requirements.
15 CFR Part 742
Exports, Terrorism.
15 CFR Part 744
Exports, Reporting and recordkeeping requirements, Terrorism.
Accordingly, parts 740, 742, and 744 of the Export Administration
Regulations (15 CFR parts 730-774) are amended as follows:
PART 740--[AMENDED]
0
1. The authority citation for part 740 continues to read as follows:
Authority: 50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.; 50
U.S.C. 1701 et seq.; 22 U.S.C. 7201 et seq.; E.O. 13026, 61 FR
58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR,
2001 Comp., p. 783.
0
2. Supplement no. 1 to part 740 is amended in the Country Group D table
by revising the entry for ``Cambodia'' and note 1 to the table to read
as follows:
Supplement No. 1 to Part 740--Country Groups
* * * * *
Country Group D
--------------------------------------------------------------------------------------------------------------------------------------------------------
[D:5] U.S. arms
Country [D:1] National [D:2] Nuclear [D:3] Chemical [D:4] Missile embargoed
security & biological technology countries \1\
--------------------------------------------------------------------------------------------------------------------------------------------------------
* * * * * * *
Cambodia........................................................... X ............... ............... ............... X
* * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Note to Country Group D:5: Countries subject to U.S. arms embargoes are identified by the State Department through notices published in the Federal
Register. The list of arms embargoed destinations in this table is drawn from 22 CFR 126.1 and State Department Federal Register notices related to
arms embargoes (compiled and accessible at https://www.pmddtc.state.gov) and will be amended when the State Department publishes subsequent notices.
If there are any discrepancies between the list of countries in this table and the countries identified by the State Department as subject to a U.S.
arms embargo (in the Federal Register), the State Department's list of countries subject to U.S. arms embargoes shall be controlling.
* * * * *
PART 742--[AMENDED]
0
3. The authority citation for part 742 continues to read as follows:
Authority: 50 U.S.C. 4801-4852; 50 U.S.C. 4601 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; Sec. 1503, Pub. L. 108-11, 117
Stat. 559; 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. 13026, 61 FR 58767, 3 CFR,
1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p.
783; Presidential Determination 2003-23, 68 FR 26459, 3 CFR, 2004
Comp., p. 320; Notice of November 12, 2020, 85 FR 72897 (November
13, 2020).
0
4. Section 742.4 is amended by revising paragraphs (b)(6) and (7) to
read as follows:
Sec. 742.4 National security.
* * * * *
(b) * * *
(6) The general policy for Laos is to approve license applications
when BIS determines, on a case-by-case basis, that the items are for an
authorized use in Laos and are not likely to be diverted to another
country or use contrary to the national security or foreign policy
controls of the Unied States.
(7)(i) For Burma, Cambodia, the People's Republic of China (China),
the Russian Federation, and Venezuela, all applications will be
reviewed to determine the risk of diversion to a military end user or
military end use. There is a general policy of approval for license
applications to export, reexport, or transfer items determined to be
for civil end users for civil end uses. There is a presumption of
denial for license applications to export, reexport, or transfer items
that would make a material contribution to the ``development,''
``production,'' maintenance, repair, or operation of weapons systems,
subsystems, and assemblies, such as, but not limited to, those
described in supplement no. 7 to this part, of Burma, Cambodia, China,
the Russian Federation, or Venezuela.
(ii) The following factors are among those that will be considered
in reviewing license applications described in paragraph (b)(7)(i) of
this section:
(A) The appropriateness of the export, reexport, or transfer for
the stated end use;
(B) The significance of the item for the weapon systems
capabilities of the importing country;
(C) Whether any party is a `military end user' as defined in Sec.
744.21(g) of the EAR;
(D) The reliability of the parties to the transaction, including
whether:
(1) An export or reexport license application has previously been
denied;
(2) Any parties are or have been engaged in unlawful procurement or
diversion activities;
(3) The parties are capable of securely handling and storing the
items; and
(4) End-use checks have been and may be conducted by BIS or another
[[Page 70018]]
U.S. Government agency on parties to the transaction;
(E) The involvement of any party to the transaction in military
activities, including activities involving the ``development,''
``production,'' maintenance, repair, or operation of weapons systems,
subsystems, and assemblies;
(F) Government strategies and policies that support the diversion
of exports from their stated civil end use and redirection towards
military end use; and
(G) The scope and effectiveness of the export control system in the
importing country.
(iii) The review will also include an assessment of the impact of a
proposed export of an item on the United States defense industrial base
and the denial of an application for a license that would have a
significant negative impact, as defined in section 1756(d)(3) of the
Export Control Reform Act of 2018 (50 U.S.C. 4815(d)(3)), on such
defense industrial base.
* * * * *
PART 744--[AMENDED]
0
5. The authority citation for part 744 continues to read as follows:
Authority: 50 U.S.C. 4801-4852; 50 U.S.C. 4601 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. 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 September 15, 2021, 86 FR 52069 (September 17, 2021); Notice of
November 10, 2021, 86 FR 62891 (November 12, 2021).
0
6. Section 744.6 is amended by revising paragraph (b)(5) to read as
follows:
Sec. 744.6 Restrictions on specific activities of ``U.S. persons.''
* * * * *
(b) * * *
(5) A `military-intelligence end use' or a `military-intelligence
end user,' as defined in Sec. 744.22(f), in Burma, Cambodia, the
People's Republic of China, Russia, or Venezuela; or a country listed
in Country Groups E:1 or E:2 (see supplement no. 1 to part 740 of the
EAR).
* * * * *
0
7. Section 744.21 is revised to read as follows:
Sec. 744.21 Restrictions on Certain `military end use' or `military
end user' in Burma, Cambodia, the People's Republic of China, the
Russian Federation, or Venezuela.
(a) General prohibition. In addition to the license requirements
for items specified on the Commerce Control List (CCL) (supplement no.
1 to part 774 of the EAR), you may not export, reexport, or transfer
(in-country) any item subject to the EAR listed in supplement no. 2 to
this part to Burma, Cambodia, the People's Republic of China (China),
the Russian Federation, or Venezuela without a license if, at the time
of the export, reexport, or transfer (in-country), you have
``knowledge,'' as defined in Sec. 772.1 of the EAR, that the item is
intended, entirely or in part, for a `military end use,' as defined in
paragraph (f) of this section, or `military end user,' as defined in
paragraph (g) of this section, in Burma, Cambodia, China, the Russian
Federation, or Venezuela.
(b) Additional prohibition on those informed by BIS. BIS may inform
you either individually by specific notice, through amendment to the
EAR published in the Federal Register, or through a separate
notification published in the Federal Register, that a license is
required for specific exports, reexports, or transfers (in-country) of
any item because there is an unacceptable risk of use in or diversion
to a `military end use' or `military end user' in Burma, Cambodia,
China, the Russian Federation, or Venezuela. Specific notice will be
given only by, or at the direction of, the Deputy Assistant Secretary
for Export Administration. When such notice is provided orally, it will
be followed by written notice within two working days signed by the
Deputy Assistant Secretary for Export Administration or the Deputy
Assistant Secretary's designee. The absence of BIS notification does
not excuse the exporter from compliance with the license requirements
of paragraph (a) of this section.
(1) `Military End-User' (MEU) List. BIS may inform and provide
notice to the public that certain entities are subject to the
additional prohibition described under this paragraph (b) following a
determination by the End-User Review Committee (ERC) that a specific
entity is a `military end user' pursuant to this section and therefore
any exports, reexports, or transfers (in-country) to that entity
represent an unacceptable risk of use in or diversion to a `military
end use' or `military end user' in Burma, Cambodia, China, the Russian
Federation, or Venezuela. Such entities may be added to supplement no.
7 to this part--`Military End-User' (MEU) List through Federal Register
notifications published by BIS and will thus be subject to a license
requirement for exports, reexports, or transfers (in-country) of items
specified in supplement no. 2 to this part. The listing of entities
under supplement no. 7 to this part is not an exhaustive listing of
`military end users' for purposes of this section. Exporters,
reexporters, and transferors are responsible for determining whether
transactions with entities not listed on supplement no. 7 to this part
are subject to a license requirement under paragraph (a) of this
section. The process in this paragraph (b)(1) for placing entities on
the MEU List is only one method BIS may use to inform exporters,
reexporters, and transferors of license requirements under this
section.
(i) End-User Review Committee (ERC). 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 other
modifications to the MEU List. Decisions by the ERC for purposes of the
MEU List will be made following the procedures identified in this
section and in supplement no. 5 to this part--Procedures for End-User
Review Committee Entity List and `Military End User' (MEU) List
Decisions.
(ii) License requirement for parties to the transaction. The
license requirement for entities listed in supplement no. 7 to this
part applies to the export, reexport, or transfer (in-country) of any
item subject to the EAR listed in supplement no. 2 to this part when an
entity that is listed on the MEU List is a party to the transaction as
described in Sec. 748.5(c) through (f) of the EAR.
(2) Requests for removal from or modification of `Military End-
User' (MEU) List. Any entity listed on the MEU List may request that
its listing be removed or modified. All such requests, including
reasons therefor, must be in writing and sent to: Chair, End-User
Review Committee, Bureau of Industry and Security, U.S. Department of
Commerce, 14th Street and Pennsylvania Avenue NW, Room 3886,
Washington, DC 20230; or by email at [email protected]. In order for an
entity listed on the MEU List to petition BIS for their removal or
modification, as applicable, the entity must address why the entity is
not a `military end user' for purposes of this section.
(i) Review. The ERC will review such requests for removal or
modification in accordance with the procedures set forth in supplement
no. 5 to this part.
[[Page 70019]]
(ii) BIS action. The Deputy Assistant Secretary for Export
Administration will convey the decision on the request to the requester
in writing. That decision will be the final agency action on the
request.
(c) License exception. Despite the prohibitions described in
paragraphs (a) and (b) of this section, you may export, reexport, or
transfer (in-country) items subject to the EAR under the provisions of
License Exception GOV set forth in Sec. 740.11(b)(2)(i) and (ii) of
the EAR.
(d) License application procedure. When submitting a license
application pursuant to this section, you must state in the
``additional information'' block of the application that ``this
application is submitted because of the license requirement in Sec.
744.21 of the EAR (Restrictions on a `Military End Use' or `Military
End User' in Burma, Cambodia, the People's Republic of China, the
Russian Federation, or Venezuela).'' In addition, either in the
additional information block of the application or in an attachment to
the application, you must include all known information concerning the
`military end use' and `military end user(s)' of the item(s). If you
submit an attachment with your license application, you must reference
the attachment in the ``additional information'' block of the
application.
(e) License review standards. (1) Applications to export, reexport,
or transfer (in-country) items described in paragraph (a) of this
section will be reviewed with a presumption of denial.
(2) Applications may be reviewed under chemical and biological
weapons, nuclear nonproliferation, or missile technology review
policies, as set forth in Sec. Sec. 742.2(b)(4), 742.3(b)(4), and
742.5(b)(4) of the EAR, if the end use may involve certain
proliferation activities.
(3) Applications for items requiring a license for any reason that
are destined to Burma, Cambodia, China, the Russian Federation, or
Venezuela for a `military end use' or `military end user' also will be
subject to the review policy stated in paragraph (e)(1) of this
section.
(f) Military end use. In this section, `military end use' means:
Incorporation into a military item described on the U.S. Munitions List
(USML) (22 CFR part 121, International Traffic in Arms Regulations);
incorporation into items classified under Export Control Classification
Numbers (ECCNs) ending in ``A018'' or under ``600 series'' ECCNs; or
any item that supports or contributes to the operation, installation,
maintenance, repair, overhaul, refurbishing, ``development,'' or
``production,'' of military items described on the USML, or items
classified under ECCNs ending in ``A018'' or under ``600 series''
ECCNs.
(g) Military end user. In this section, the term `military end
user' means the national armed services (army, navy, marine, air force,
or coast guard), as well as the national guard and national police,
government intelligence or reconnaissance organizations, or any person
or entity whose actions or functions are intended to support `military
end uses' as defined in paragraph (f) of this section.
(h) Effects on contracts. Venezuela: Transactions involving the
export, reexport, or transfer (in country) of items to or within
Venezuela are not subject to the provisions of this section if the
contracts for such transactions were signed prior to November 7, 2014.
0
8. Section 744.22 is revised to read as follows:
Sec. 744.22 Restrictions on exports, reexports, and transfers (in-
country) to certain military-intelligence end uses or end users.
(a) General prohibition. In addition to the license requirements
for items specified on the Commerce Control List (CCL) (supplement no.
1 to part 774 of the EAR), you may not export, reexport, or transfer
(in-country) any item subject to the EAR without a license from BIS if,
at the time of the export, reexport, or transfer (in-country), you have
``knowledge'' that the item is intended, entirely or in part, for a
`military-intelligence end use' or a `military-intelligence end user'
in Burma, Cambodia, the People's Republic of China (China), Russia, or
Venezuela; or a country listed in Country Groups E:1 or E:2 (see
supplement no. 1 to part 740 of the EAR).
(b) Additional prohibition on those informed by BIS. BIS may inform
you either individually by specific notice, through amendment to the
EAR published in the Federal Register, or through a separate
notification published in the Federal Register, that a license is
required for specific exports, reexports, or transfers (in-country) of
any item subject to the EAR because there is an unacceptable risk of
use in, or diversion to, a `military-intelligence end use' or a
`military-intelligence end user' in Burma, Cambodia, China, Russia, or
Venezuela; or a country listed in Country Group E:1 or E:2 (see
supplement no. 1 to part 740 of the EAR).
(c) License exception. Notwithstanding the prohibitions described
in paragraphs (a) and (b) of this section, you may export, reexport, or
transfer (in-country) items subject to the EAR under the provision of
License Exception GOV set forth in Sec. 740.11(b)(2)(ii) of the EAR.
(d) License application procedure. When submitting a license
application pursuant to this section, you must state in the
``additional information'' block of the application that ``this
application is submitted because of the license requirement in Sec.
744.22 of the EAR (Restrictions on exports, reexports, and transfers
(in-country) to certain military-intelligence end uses or end users).''
In addition, either in the additional information block of the
application or in an attachment to the application, you must include
all known information concerning the military-intelligence end use(s)
or end user(s) of the item(s). If you submit an attachment with your
license application, you must reference the attachment in the
``additional information'' block of the application.
(e) License review policy. Applications to export, reexport, or
transfer (in-country) items requiring a license pursuant to paragraph
(a) or (b) of this section will be reviewed with a presumption of
denial.
(f) Definitions. (1) `Military-intelligence end use' means the
``development,'' ``production,'' operation, installation (including on-
site installation), maintenance (checking), repair, overhaul, or
refurbishing of, or incorporation into, items described on the U.S.
Munitions List (USML) (22 CFR part 121, International Traffic in Arms
Regulations), or classified under ECCNs ending in ``A018'' or under
``600 series'' ECCNs, which are intended to support the actions or
functions of a `military-intelligence end user,' as defined in this
section.
(2) `Military-intelligence end user' means any intelligence or
reconnaissance organization of the armed services (army, navy, marine,
air force, or coast guard); or national guard. For license requirements
applicable to other government intelligence or reconnaissance
organizations in Burma, Cambodia, China, Russia, or Venezuela, see
Sec. 744.21. Military-intelligence end users subject to the license
requirements set forth in this section include, but are not limited to,
the following:
(i) Burma. Office of Chief of Military Security Affairs (OCMSA) and
the Directorate of Signal.
(ii) Cambodia. General Department of Research and Intelligence
(GDRI).
(iii) Cuba. Directorate of Military Intelligence (DIM) and
Directorate of Military Counterintelligence (CIM).
(iv) China, People's Republic of. Intelligence Bureau of the Joint
Staff Department.
[[Page 70020]]
(v) Iran. Islamic Revolutionary Guard Corps Intelligence
Organization (IRGC-IO) and Artesh Directorate for Intelligence (J2).
(vi) Korea, North. Reconnaissance General Bureau (RGB).
(vii) Russia. Main Intelligence Directorate (GRU).
(viii) Syria. Military Intelligence Service.
(ix) Venezuela. General Directorate of Military Counterintelligence
(DGCIM).
0
9. Supplement No.7 to part 744 is amended in the table by adding in
alphabetical order an entry for ``CAMBODIA'' to read as follows:
Supplement No. 7 to Part 744--'Military End-User' (MEU) List
* * * * *
------------------------------------------------------------------------
Federal Register
Country Entity citation
------------------------------------------------------------------------
* * * * *
Cambodia....................... [Reserved]......... [Reserved]
* * * * *
------------------------------------------------------------------------
Matthew S. Borman,
Deputy Assistant Secretary for Export Administration.
[FR Doc. 2021-26633 Filed 12-8-21; 8:45 am]
BILLING CODE 3510-33-P
