Official says Export Control Reform Goals 'In Sight,' BIS Lists Second-Term Priorities
“Export Control Reform has not stalled…and our goal is in sight” said Assistant Secretary for Political-Military Affairs Andrew Shapiro in his opening remarks at the Bureau of Industry and Security’s annual Update 2012 Conference on Export Controls and Policy. “Come January, we will either have crossed the goal line,” or whoever replaces the officials in the next administration will “dive into the end zone and do a touchdown dance,” he said. BIS Under Secretary Eric Hirschhorn also addressed recent Congressional activity on Export Control Reform (ECR) in his opening remarks, and outlined the Obama administration’s second-term priorities for ECR.
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Referring to the move of items from the U.S. Munitions List to the Commerce Control List, BIS Under Secretary Eric Hirschhorn said “transparency and predictability have been key virtues” of the Export Control Reform rules BIS has issued to date. Such qualities are vital to compliance, Hirschhorn said, because it is difficult for industry to comply if it doesn’t understand the rules.
Working to Ameliorate Amendment that Could Cripple Export Reform; 38(f) Notifications Soon
In a review of recent developments on Capitol Hill, Hirschhorn said Congress recently passed an amendment to restore the President’s authority to determine appropriate export controls for satellites, but this amendment included provisions that could “delay or cripple” the entire ECR effort. “We are working to ameliorate these provisions,” said Hirschhorn.
Also, BIS has held “considerable talks” with Congress, he said, and the State Department plans to send its first 38(f) notification to Congress in late summer or early fall. Other officials confirmed that this first notification will include the July 15, 2011 framework rule, the USML-CCL transition rule, the specially designed rule, and rules to move items to the CCL from USML Categories VIII (aircraft and associated equipment) and XIX (a new category for Gas Turbine Engines).
(See ITT’s Online Archives 11071519 for summary of the July 15 framework rule; 12062031 and 12062103 for parts 1 and 2 of summary of the transition rule, respectively; 12061802 for summary of the revised proposed definition of specially designed; 11110604 for the proposed rule for Category VIII of the USML; and 11120852 for the proposed rule for Category XIX of the USML.)
BIS has also been working with the Census Bureau and CBP to improve ACE, and has been developing “a targeted and multifaceted outreach program to support Export Control Reform,” he said.
Second-Term Priorities for BIS Include Deemed Exports, Systematic Review, Encryption, Etc.
In the event that Obama is reelected, Hirschhorn said, BIS has identified the following second-term projects (which have not yet been reviewed by partner agencies) (not an exhaustive list):
- Finish the systematic review of the CCL
- Complete harmonization of terms between the International Traffic in Arms Regulations, the CCL, and other control lists
- Revisit the Intracompany Transfer (ICT) license exception for deemed exports
- Clarify and make more concise the encryption rule
- Adjust criteria for the Shipments of Limited Value (LVS) license exception for inflation
- Update recordkeeping requirements to account for technological developments
- An examination of rules relating to cloud computing
Military Electronics Rule Hoped for by End of Month; Outreach Planned
Assistant Secretary for Export Administration Kevin Wolf concluded the conference’s opening remarks. Wolf said that BIS hopes to issue its proposed rule on the transfer of military electronics from USML Category XI to the CCL by the end of the month, and noted that this rule is complicated because it is only second to aircraft and engines in its impact on industry. Wolf also said BIS is partnering with non-profits to develop outreach on Export Control Reform for small and medium-sized businesses.