BIS Amends EAR to Remove Limitations on Ability to Revoke Licenses Without Notice
The Bureau of Industry and Security has issued a final rule, effective March 2, 2011, to amend the Export Administration Regulations (EAR) by revising the Application Processing, Issuance, and Denial provisions concerning BIS's authority to revise, suspend or revoke licenses.
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Authority to Revoke/Revise Without Notice No Longer Linked to Known Violations
In this final rule, BIS revises the first sentence in paragraph (a) of 15 CFR 750.8 (revocation or suspension of licenses) to read as follows (deleted text denoted by strikethrough):
All licenses for exports or reexports are subject to revision, suspension, or revocation, in whole or in part, without notice whenever it is known that the EAR have been violated or that a violation is about to occur.
Change Harmonizes Licensing Authority with License Exception Rules
BIS states that this change will harmonize 15 CFR 750.8(a), concerning licenses, with an analogous provision in 15 CFR 740.2(b) regarding the revision, suspension or revocation of license exceptions under the EAR.
(15 CFR 740.2(b) states all License Exceptions are subject to revision, suspension, or revocation, in whole or in part, without notice. It may be necessary for BIS to stop a shipment or an export transaction at any stage of its progress, e.g., in order to prevent an unauthorized export or reexport. If a shipment is already en route, it may be further necessary to order the return or unloading of the shipment at any port of call.)
Allows BIS to Stop a Shipment or Export Transaction for Foreign Policy Interests
As a result of this change, the ability of the U.S. to revise, revoke, or suspend a license without notice is not limited to instances when it is known that the EAR have been violated or a violation is about to occur, but also to prevent licensed export transactions in which the U.S. may subsequently have an interest, including a foreign policy interest.
(BIS characterizes this final rule as a clarification. However, BIS also states the final rule has been determined to be significant for the purposes of Executive Order 12866 -- Regulatory Planning and Review. According to the EO, “significant regulatory action" means any regulatory action that is likely to result in a rule that may: (1) have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive order.)
BIS contact- Sheila Quarterman (202) 482-2440 or rpd2@bis.doc.gov
(FR Pub 03/07/11, D/N 110224164-1168-02)