80 FR 29565 - Amendment to the International Traffic in Arms Regulations: Exports and Temporary Imports Made to or on Behalf of a Department or Agency of the U.S. Government; Procedures for Obtaining State Department Authorization To Export Items Subject to the Export Administration Regulations; Revision to the Destination Control Statement; and Other Changes

DEPARTMENT OF STATE

Federal Register Volume 80, Issue 99 (May 22, 2015)

Page Range		29565-29569
FR Document		2015-12295
As part of the President's Export Control Reform (ECR) effort, the Department of State is proposing to amend the International Traffic in Arms Regulations (ITAR) to: clarify regulations pertaining to the export of items subject to the Export Administration Regulations (EAR); revise the licensing exemption for exports made to or on behalf of an agency of the U.S. government; revise the destination control statement in ITAR Sec. 123.9 to harmonize the language with the EAR; and make several minor edits for clarity. The proposed revisions contained in this rule are part of the Department of State's retrospective plan under E.O. 13563.
Federal Register, Volume 80 Issue 99 (Friday, May 22, 2015)
[Federal Register Volume 80, Number 99 (Friday, May 22, 2015)]
[Proposed Rules]
[Pages 29565-29569]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-12295]


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DEPARTMENT OF STATE

22 CFR Parts 120, 123, 124, 125, and 126

RIN 1400-AC88
[Public Notice 9139]


Amendment to the International Traffic in Arms Regulations: 
Exports and Temporary Imports Made to or on Behalf of a Department or 
Agency of the U.S. Government; Procedures for Obtaining State 
Department Authorization To Export Items Subject to the Export 
Administration Regulations; Revision to the Destination Control 
Statement; and Other Changes

AGENCY: Department of State.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: As part of the President's Export Control Reform (ECR) effort, 
the Department of State is proposing to amend the International Traffic 
in Arms Regulations (ITAR) to: clarify regulations pertaining to the 
export of items subject to the Export Administration Regulations (EAR); 
revise the licensing exemption for exports made to or on behalf of an 
agency of the U.S. government; revise the destination control statement 
in ITAR Sec.  123.9 to harmonize the language with the EAR; and make 
several minor edits for clarity. The proposed revisions contained in 
this rule are part of the Department of State's retrospective plan 
under E.O. 13563.

DATES: The Department of State will accept comments on this proposed 
rule until July 6, 2015.

ADDRESSES: Interested parties may submit comments by one of the 
following methods:
     Email: [email protected] with the subject line, 
``ITAR Amendment--To or on behalf of'';
     Internet: At www.regulations.gov, search for this proposed 
rule by using this proposed rule's RIN (1400-AC88).
    Comments received after that date will be considered if feasible, 
but consideration cannot be assured. Those submitting comments should 
not include any personally identifying information they do not desire 
to be made public or information for which a claim of confidentiality 
is asserted because those comments and/or transmittal emails will be 
made available for public inspection and copying after the close of the 
comment period via the Directorate of Defense Trade Controls Web site 
at www.pmddtc.state.gov. Parties who wish to comment anonymously may do 
so by submitting their comments via www.regulations.gov, leaving the 
fields that would identify the commenter blank and including no 
identifying information in the comment itself. Comments submitted via 
www.regulations.gov are immediately available for public inspection.

FOR FURTHER INFORMATION CONTACT: Mr. C. Edward Peartree, Director, 
Office of Defense Trade Controls Policy, Department of State, telephone 
(202) 663-2792; email [email protected]. ATTN: ITAR 
Amendment--To or on behalf of. The Department of State's full 
retrospective plan can be accessed at http://www.state.gov/documents/organization/181028.pdf.

SUPPLEMENTARY INFORMATION: The Department proposes to make the 
following revisions in this rule:
    Items subject to the EAR: This proposed rule adds clarifying 
language to various provisions of the ITAR pertaining to the export of 
items subject to the EAR pursuant to a Department of State 
authorization, when such exports are made in conjunction with items 
subject to the ITAR. These revisions include guidance on the use of 
licensing exemptions for export of such items, as well as clarification 
that items subject to the EAR are not considered defense articles, even 
when exported under a license or other approval (to include exemptions, 
see Sec.  120.20) issued by the Department of State.
    Items exported to or on behalf of an agency of the U.S. government: 
This proposed rule revises the licensing exemption language in ITAR 
Sec.  126.4 to clarify when exports may be made to or on behalf of an 
agency of the U.S. government without a license. Additionally, the 
scope of this exemption is expanded in that it will allow for permanent 
exports, rather than only temporary exports. The Department seeks 
comments from the public on whether the proposed revision adequately 
eliminates ambiguity as to when the exemption may be applied, and 
whether it creates any unintended compliance burden.
    Revision to the Destination Control Statement: This proposed rule 
revises the destination control statement in ITAR Sec.  123.9 to 
harmonize its language with the EAR. This change is being made to 
facilitate the President's Export Control Reform initiative, which has 
transferred thousands of formerly ITAR-controlled defense article parts 
and components, along with other items, to the Commerce Control List in 
the EAR under the jurisdiction of the Department of Commerce.
    This change in jurisdiction for many parts and components, along 
with other items, for military systems has increased the incidence of 
exporters shipping articles subject to both the ITAR and the EAR in the 
same shipment. Both regulations have a mandatory destination control 
statement that must be on the export control documents for shipments 
that include items subject to both sets of regulations. This has caused 
confusion to exporters as to which statement to include on mixed 
shipments, or whether to include both. Harmonizing these statements 
will ease the regulatory burden on exporters.
    Procedures for Obtaining State Department Authorization to Export 
Items Subject to the EAR: This proposed rule revises the ITAR in a 
number of places to clarify how parties may obtain authorization from 
the Department to export or retransfer items subject to the EAR. 
Section 120.5 is revised to clarify that items subject to the EAR may 
be authorized pursuant to an exemption with certain conditions. A new 
paragraph (d) is added to ITAR Sec.  123.9 to clarify the requirements 
for retransferring items subject to the EAR pursuant to a letter of 
General Correspondence. Section 124.16 is revised to clarify that the 
special retransfer authorization of this section may be used for items 
subject to the EAR with certain conditions.

[[Page 29566]]

    Other changes in this rule: The Department proposes to make a 
number of minor edits to the ITAR that will address erroneous or 
outdated reporting requirements. This rule would remove the requirement 
to provide seven paper copies for various export license requests in 
Sec. Sec.  124.7, 124.12, 124.14, 125.2, 125.7 and 126.9, which has not 
been necessary for many years due to the use of electronic license 
submissions, change the identification of the agency responsible for 
permanent import authorizations in Sec.  123.4 from the Department of 
the Treasury to Department of Justice, and impose the Code of Federal 
Regulations paragraph structure on Sec.  124.8. Additionally, the 
Department proposes removing the pilot filing requirement found in 
Sec.  123.13, given that it does not take into account the practices of 
modern airport operations and is no longer necessary.

Regulatory Analysis and Notices

Administrative Procedure Act

    The Department of State is of the opinion that controlling the 
import and export of defense articles and services is a foreign affairs 
function of the United States government and that rules implementing 
this function are exempt from Sec. Sec.  553 (rulemaking) and 554 
(adjudications) of the Administrative Procedure Act (APA). Although the 
Department is of the opinion that this rule is exempt from the 
rulemaking provisions of the APA, the Department is publishing this 
rule with a 45-day provision for public comment and without prejudice 
to its determination that controlling the import and export of defense 
services is a foreign affairs function.

Regulatory Flexibility Act

    Since the Department of State is of the opinion that this proposed 
rule is exempt from the provisions of 5 U.S.C. 553, there is no 
requirement for an analysis under the Regulatory Flexibility Act.

Unfunded Mandates Reform Act of 1995

    This proposed rulemaking does not involve a mandate that will 
result in the expenditure by State, local, and tribal governments, in 
the aggregate, or by the private sector, of $100 million or more in any 
year and it will not significantly or uniquely affect small 
governments. Therefore, no actions were deemed necessary under the 
provisions of the Unfunded Mandates Reform Act of 1995.

Small Business Regulatory Enforcement Fairness Act of 1996

    The Department does not believe this rulemaking is a major rule as 
defined in 5 U.S.C. 804.

Executive Orders 12372 and 13132

    This proposed rulemaking will not have substantial direct effects 
on the States, on the relationship between the national government and 
the States, or on the distribution of power and responsibilities among 
the various levels of government. Therefore, in accordance with 
Executive Order 13132, it is determined that this proposed rulemaking 
does not have sufficient federalism implications to require 
consultations or warrant the preparation of a federalism summary impact 
statement. The regulations implementing Executive Order 12372 regarding 
intergovernmental consultation on Federal programs and activities do 
not apply to this proposed rulemaking.

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess 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, distributed impacts, and equity). These executive orders 
stress the importance of quantifying both costs and benefits, of 
reducing costs, of harmonizing rules, and of promoting flexibility. 
These rules have been designated ``significant regulatory actions,'' 
although not economically significant, under Executive Order 12866. 
Accordingly, this proposed rule has been reviewed by the Office of 
Management and Budget (OMB).

Executive Order 12988

    The Department of State has reviewed this proposed rulemaking in 
light of Executive Order 12988 to eliminate ambiguity, minimize 
litigation, establish clear legal standards, and reduce burden.

Executive Order 13175

    The Department of State has determined that this proposed 
rulemaking will not have tribal implications, will not impose 
substantial direct compliance costs on Indian tribal governments, and 
will not preempt tribal law. Accordingly, the provisions of Executive 
Order 13175 do not apply to this proposed rulemaking.

Paperwork Reduction Act

    This rule does not impose any new reporting or recordkeeping 
requirements subject to the Paperwork Reduction Act, 44 U.S.C. Chapter 
35. This rule removes provisions that previously required the applicant 
to provide seven additional copies for various export license requests. 
The Department believes that there will be little or no practical 
burden reduction since the use of electronic methods of filing has made 
the requirement for ``seven copies'' obsolete.
    The following information collections are affected by this 
rulemaking:
    1. Application/License for Permanent Export of Unclassified Defense 
Articles and Related Unclassified Technical Data, OMB Control No. 1405-
0003;
    2. Application/License for Temporary Import of Unclassified Defense 
Articles, OMB Control No. 1405-0013;
    3. Application/License for the Permanent/Temporary Export or 
Temporary Import of Classified Defense Articles and Classified 
Technical Data, OMB Control No. 1405-0022;
    4. Application/License for Temporary Export of Unclassified Defense 
Articles, OMB Control No. 1405-0023;
    5. Application for Amendment to License for Export or Import of 
Classified or Unclassified Defense Articles and Related Technical Data 
OMB Control No. 1405-0092;
    6. Request for Approval of Manufacturing License Agreements, 
Technical Assistance Agreements, and Other Agreements, OMB Control No. 
1405-0093;
    7. Request to Change End User, End Use and/or Destination of 
Hardware, OMB Control No. 1405-00173; and
    8. Request for Advisory Opinion, OMB Control No. 1405-0174.
    The Department is requesting public comment on its estimate that 
there will be little or no change in the burdens associated with these 
information collections as a result of this rulemaking.
    Date: Comments will be accepted until July 21, 2015.
    Addresses: Interested parties may submit comments within 60 days of 
the date of publication by one of the following methods:
     Email: [email protected], with the subject line 
``AC88 PRA Burden Reduction'';
     Internet: At www.regulations.gov; please search for this 
proposed rule by using this proposed rule's RIN (1400-AC88) and 
indicate that you are commenting on the paperwork burden change in any 
(or all) of the eight information collections identified above.

[[Page 29567]]

List of Subjects

22 CFR Parts 120 and 125

    Arms and munitions, Classified information, Exports.

22 CFR Part 123

    Arms and munitions, Exports, Reporting and recordkeeping 
requirements.

22 CFR Part 124

    Arms and munitions, Exports, Technical assistance.

22 CFR Part 126

    Arms and munitions, Exports.

    Accordingly, for the reasons set forth above, Title 22, Chapter I, 
Subchapter M, parts 120, 123, 124, 125, and 126 are proposed to be 
amended as follows:

PART 120--PURPOSE AND DEFINITIONS

0
1. The authority citation for part 120 continues to read as follows:

    Authority:  Secs. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 
(22 U.S.C. 2752, 2778, 2797); 22 U.S.C. 2794; 22 U.S.C. 2651a; Pub. 
L. 105-261, 112 Stat. 1920; Pub. L. 111-266; Section 1261, Pub. L. 
112-239; E.O. 13637, 78 FR 16129.

0
2. Section 120.5 is amended by revising the section heading and 
paragraph (b) to read as follows:


Sec.  120.5  Relation to regulations of other agencies; export of items 
subject to the EAR.

* * * * *
    (b) A license or other approval (see Sec.  120.20) from the 
Department of State granted in accordance with this subchapter may also 
authorize the export of items subject to the EAR (see Sec.  120.42). 
Items subject to the EAR may be exported pursuant to an exemption (see 
parts 124, 125, and 126 of this subchapter), provided the items subject 
to the EAR are for use in or with defense articles authorized under a 
license or other approval. Separate approval from the Department of 
Commerce is not required for these items when approved for export under 
a Department of State license or other approval. Those items subject to 
the EAR exported pursuant to a Department of State license or other 
approval would remain under the jurisdiction of the Department of 
Commerce for any subsequent transactions. The inclusion of items 
subject to the EAR on a Department of State license or other approval 
does not change the licensing jurisdiction of the items. (See Sec.  
123.1(b) of this subchapter for guidance on identifying items subject 
to the EAR in a license application to the Department of State.)

PART 123--LICENSES FOR THE EXPORT AND TEMPORARY IMPORT OF DEFENSE 
ARTICLES

0
3. The authority citation for part 123 continues to read as follows:

    Authority: Secs. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 (22 
U.S.C. 2752, 2778, 2797); 22 U.S.C. 2753; 22 U.S.C. 2651a; 22 U.S.C. 
2776; Pub. L. 105-261, 112 Stat. 1920; Sec. 1205(a), Pub. L. 107-
228; Section 1261, Pub. L. 112-239; E.O. 13637, 78 FR 16129.

0
4. Section 123.4 is amended by revising paragraph (a)(4) to read as 
follows:


Sec.  123.4  Temporary import license exemptions.

    (a) * * *
    (4) Has been rejected for permanent import by the Department of 
Justice and is being returned to the country from which it was shipped; 
or
* * * * *
0
5. Section 123.9 is amended by revising paragraphs (b)(1) and (2), and 
adding paragraph (d) to read as follows:


Sec.  123.9  Country of ultimate destination and approval of reexports 
or retransfers.

* * * * *
    (b) * * *
    (1) The exporter must incorporate the following information as an 
integral part of the bill of lading, air waybill, or other shipping 
document, and the purchase documentation or invoice whenever defense 
articles are to be exported, retransferred, or reexported pursuant to a 
license or other approval under this subchapter:
    (i) The country of ultimate destination;
    (ii) The end-user;
    (iii) The license or other approval number or exemption citation; 
and
    (iv) The following statement: ``These items are controlled and 
authorized by the U.S. government for export only to the country of 
ultimate destination for use by the end-user herein identified. They 
may not be resold, transferred, or otherwise be disposed of, to any 
other country or to any person other than the authorized end-user or 
consignee(s), either in their original form or after being incorporated 
into other items, without first obtaining approval from the U.S. 
government or as otherwise authorized by U.S. law and regulations.''
    (2) When exporting items subject to the EAR (see Sec. Sec.  120.42 
and 123.1(b) of this subchapter) pursuant to a Department of State 
license or other approval, the U.S. exporter must also provide the end-
user and consignees with the appropriate EAR classification information 
for each item exported pursuant to a U.S. Munitions List ``(x)'' 
paragraph. This includes the Export Control Classification Number 
(ECCN) or EAR99 designation.
* * * * *
    (d) The Directorate of Defense Trade Controls may authorize 
reexport or retransfer of an item subject to the EAR provided that:
    (1) The item was initially exported, reexported or transferred 
pursuant to a Department of State license or other approval;
    (2) The item is for end-use in or with a defense article; and,
    (3) All requirements of paragraph (c) of this section are satisfied 
for the item subject to the EAR, as well as for the associated defense 
article.
* * * * *
0
6. Revise Sec.  123.13 to read as follows:


Sec.  123.13  Domestic aircraft shipments via a foreign country.

    A license is not required for the shipment by air of a defense 
article from one location in the United States to another location in 
the United States via a foreign country.

PART 124--AGREEMENTS, OFF SHORE PROCUREMENT, AND OTHER DEFENSE 
SERVICES

0
7. The authority citation for part 124 continues to read as follows:

    Authority:  Sec. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 (22 
U.S.C. 2752, 2778, 2797); 22 U.S.C. 2651a; 22 U.S.C. 2776; Pub. L. 
105-261; Section 1261, Pub. L. 112-239; E.O. 13637, 78 FR 16129.

0
8. Section 124.7 is amended by designating the introductory text as 
paragraph (a), adding and reserving paragraph (b), and revising 
paragraph (a)(1) to read as follows:


Sec.  124.7  Information required in all manufacturing license 
agreements and technical assistance agreements.

    (a) * * *
    (1) The agreement must describe the defense article to be 
manufactured and all defense articles to be exported, including any 
test and support equipment or advanced materials. They should be 
described by military nomenclature, contract number, National Stock 
Number, nameplate data, or other specific information. Only defense 
articles listed in the agreement will be eligible for export under the 
exemption in Sec.  123.16(b)(1) of this subchapter. * * *
    (b) [Reserved]
0
9. Section 124.8 is amended by designating the introductory text as 
paragraph (a) and adding and reserving paragraph (b), as follows:

[[Page 29568]]

Sec.  124.8  Clauses required both in manufacturing license agreements 
and technical assistance agreements.

* * * * *
    (b) [Reserved]
* * * * *
0
10. Section 124.12 is amended by revising the introductory text of 
paragraph (a) to read as follows:


Sec.  124.12  Required information in letters of transmittal.

    (a) An application for the approval of a manufacturing license or 
technical assistance agreement with a foreign person must be 
accompanied by an explanatory letter. The explanatory letter shall 
contain:
* * * * *
0
11. Section 124.14 is amended by revising the introductory text of 
paragraph (e) to read as follows:


Sec.  124.14  Exports to warehouses or distribution points outside the 
United States.

* * * * *
    (e) Transmittal letters. Requests for approval of warehousing and 
distribution agreements with foreign persons must be made by letter. 
The letter shall contain:
* * * * *
0
12. Section 124.16 is revised to read as follows:


Sec.  124.16  Special retransfer authorizations for unclassified 
defense articles and defense services to member states of NATO and the 
European Union, Australia, Japan, New Zealand, and Switzerland.

    (a) The provisions of Sec.  124.8(a)(5) notwithstanding, the 
Department may approve access to unclassified defense articles and 
items subject to the EAR (see Sec.  120.42 of this subchapter) exported 
in furtherance of or produced as a result of a TAA/MLA, retransfer of 
technical data and defense services, and retransfer of technology 
subject to the EAR and authorized under a TAA/MLA, to individuals who 
are dual national or third-country national employees of the foreign 
signatory or its approved sub-licensees, provided that:
    (1) The transfer is to dual nationals or third-country nationals 
who are bona fide regular employees, directly employed by the foreign 
signatory or approved sub-licensees;
    (2) The individuals are exclusively of countries that are members 
of NATO, the European Union, Australia, Japan, New Zealand, and 
Switzerland;
    (3) Their employer is a signatory to the agreement or has executed 
a Non-Disclosure Agreement; and
    (4) The retransfer takes place completely within the physical 
territories of the countries listed in paragraph (a)(2) of this section 
or the United States.
    (b) Permanent retransfer of hardware is not authorized pursuant to 
paragraph (a) of this section.

PART 125--LICENSES FOR THE EXPORT OF TECHNICAL DATA AND CLASSIFIED 
DEFENSE ARTICLES

0
13. The authority citation for part 126 continues to read as follows:

    Authority:  Secs. 2 and 38, Pub. L. 90-629, 90 Stat. 744 (22 
U.S.C. 2752, 2778); 22 U.S.C. 2651a; E.O. 13637, 78 FR 16129.

0
14. Section 125.2 is amended by revising paragraph (a) to read as 
follows:


Sec.  125.2  Exports of unclassified technical data.

    (a) License. A license (DSP-5) is required for the export of 
unclassified technical data unless the export is exempt from the 
licensing requirements of this subchapter. In the case of a plant 
visit, details of the proposed discussions must be transmitted to the 
Directorate of Defense Trade Controls for an appraisal of the technical 
data.
* * * * *
0
15. Section 125.7 is amended by revising paragraph (b) to read as 
follows:


Sec.  125.7  Procedures for the export of classified technical data and 
other classified defense articles.

* * * * *
    (b) An application for the export of classified technical data or 
other classified defense articles must be accompanied by a completed 
Form DSP-83 (see Sec.  123.10 of this subchapter). All classified 
materials accompanying an application must be transmitted to the 
Directorate of Defense Trade Controls in accordance with the procedures 
contained in the Department of Defense National Industrial Security 
Program Operating Manual (unless such requirements are inconsistent 
with guidance provided by the Directorate of Defense Trade Controls, in 
which case the latter guidance must be followed).

PART 126--GENERAL POLICIES AND PROVISIONS

0
16. The authority citation for part 126 continues to read as follows:

    Authority: Secs. 2, 38, 40, 42, and 71, Pub. L. 90-629, 90 Stat. 
744 (22 U.S.C. 2752, 2778, 2780, 2791, and 2797); 22 U.S.C. 2651a; 
22 U.S.C. 287c; E.O. 12918, 59 FR 28205; 3 CFR, 1994 Comp., p. 899; 
Sec. 1225, Pub. L. 108-375; Sec. 7089, Pub. L. 111-117; Pub. L. 111-
266; Section 7045, Pub. L. 112-74; Section 7046, Pub. L. 112-74; 
E.O. 13637, 78 FR 16129.

0
17. Section 126.4 is revised to read as follows:


Sec.  126.4  Exports and temporary imports made to or on behalf of a 
department or agency of the U.S. government.

    (a) A license is not required for the export or temporary import of 
a defense article or the performance of a defense service, when made:
    (1) To a department or agency of the U.S. government for official 
use. Defense articles exported or temporarily imported under this 
provision may only be provided to a regular employee or contractor 
support personnel of the U.S. government;

    Note 1 to paragraph (a):  Contractor support personnel means 
those U.S. persons who provide administrative, managerial, 
scientific or technical support under contract with a U.S. 
government department or agency within a U.S. government owned or 
operated facility or under the direct supervision of a regular U.S. 
government employee (e.g., Federally Funded Research and Development 
Center or Systems Engineering and Technical Assistance contractors). 
For purposes of this section, private security contractors are not 
considered contractor support personnel, and ``direct supervision'' 
refers to the control over the manner and means in which contractor 
support personnel conduct their day-to-day work activities as well 
as control over the contractor's access to defense articles 
authorized under this paragraph.


    Note 2 to paragraph (a):  Any retransfer, reexport, disposal, or 
change in end-user of a defense article exported pursuant to this 
section must be performed in accordance with Sec.  123.9 of this 
subchapter.

    (2)(i) By, or on behalf of, a department or agency of the U.S. 
government for carrying out any foreign assistance, cooperative 
project, or sales program authorized by law and subject to control by 
the President by other means, provided:
    (A) Items subject to the EAR and controlled for missile technology 
(MT) reasons (see Sec.  742.5 of the EAR (15 CFR 742.5) are not 
authorized for export under this subsection; and
    (B) The United States government performs or directs all aspects of 
the transaction (export, carriage, and delivery abroad) or the export 
is covered by a U.S. government Bill of Lading.
    (ii) This section does not authorize a U.S. government agency to 
act as a transmittal agent on behalf of a private individual or firm, 
either as a convenience or in satisfaction of security requirements.

    Note to paragraph (a)(2):  Approval of a foreign assistance, 
cooperative project, or sales program authorizing a U.S. government 
department and agency to permanently export a defense article 
described on the Missile Technology Control Regime Annex should be 
reviewed by the Missile Technology Export Committee, unless

[[Page 29569]]

authorized by statutory authority providing export authority 
notwithstanding the Arms Export Control Act.

    (b) This section does not authorize any department or agency of the 
U.S. government to make any export that is otherwise prohibited by 
virtue of other administrative provisions or by any statute.
    (c) An Electronic Export Information (EEI) filing, required under 
Sec.  123.22 of this subchapter, and a written statement by the 
exporter certifying that these requirements have been met must be 
presented at the time of export to the appropriate Port Directors of 
U.S. Customs and Border Protection or Department of Defense transmittal 
authority. For any export made pursuant to paragraph (a)(1) of this 
section, the shipment documents (bill of lading, airway bill, or other 
transportation documents) must include the following statement:
    ``For official use by [insert U.S. government department or 
agency]. Property will not enter the trade of the country to which it 
is shipped. No export license required per CFR Title 22, section 126.4. 
U.S. government point of contact: [insert name and telephone number]''.
0
18. Section 126.9 is amended by revising paragraph (a) to read as 
follows:


Sec.  126.9  Advisory opinions and related authorizations.

    (a) Advisory opinion. A person may request information from the 
Directorate of Defense Trade Controls on whether it would likely grant 
a license or other approval for a particular defense article or defense 
service to a particular country. Such information from the Directorate 
of Defense Trade Controls is issued on a case-by-case basis and applies 
only to the particular matters presented to the Directorate of Defense 
Trade Controls. These opinions are not binding on the Department of 
State and may not be used in future matters before the Department. A 
request for an advisory opinion must be made in writing and must 
outline in detail the equipment, its usage, the security classification 
(if any) of the articles or related technical data, and the country or 
countries involved.
* * * * *

 Rose E. Gottemoeller,
 Under Secretary, Arms Control and International Security, Department 
of State.
[FR Doc. 2015-12295 Filed 5-21-15; 8:45 am]
 BILLING CODE 4710-25-P
Federal Register / Vol. 80, No. 99 / Friday, May 22, 2015 / Proposed Rules 29567

List of Subjects PART 123—LICENSES FOR THE pursuant to a U.S. Munitions List ‘‘(x)’’
EXPORT AND TEMPORARY IMPORT paragraph. This includes the Export
22 CFR Parts 120 and 125
OF DEFENSE ARTICLES Control Classification Number (ECCN)
Arms and munitions, Classified or EAR99 designation.
information, Exports. ■ 3. The authority citation for part 123
* * * * *
continues to read as follows:
22 CFR Part 123 (d) The Directorate of Defense Trade
Authority: Secs. 2, 38, and 71, Pub. L. 90– Controls may authorize reexport or
Arms and munitions, Exports, 629, 90 Stat. 744 (22 U.S.C. 2752, 2778,
Reporting and recordkeeping retransfer of an item subject to the EAR
2797); 22 U.S.C. 2753; 22 U.S.C. 2651a; 22
requirements. provided that:
U.S.C. 2776; Pub. L. 105–261, 112 Stat. 1920;
Sec. 1205(a), Pub. L. 107–228; Section 1261, (1) The item was initially exported,
22 CFR Part 124 Pub. L. 112–239; E.O. 13637, 78 FR 16129. reexported or transferred pursuant to a
Arms and munitions, Exports, Department of State license or other
■ 4. Section 123.4 is amended by
Technical assistance. approval;
revising paragraph (a)(4) to read as
(2) The item is for end-use in or with
22 CFR Part 126 follows:
a defense article; and,
Arms and munitions, Exports. § 123.4 Temporary import license (3) All requirements of paragraph (c)
Accordingly, for the reasons set forth exemptions. of this section are satisfied for the item
above, Title 22, Chapter I, Subchapter (a) * * * subject to the EAR, as well as for the
M, parts 120, 123, 124, 125, and 126 are (4) Has been rejected for permanent associated defense article.
proposed to be amended as follows: import by the Department of Justice and * * * * *
is being returned to the country from ■ 6. Revise § 123.13 to read as follows:
PART 120—PURPOSE AND which it was shipped; or
DEFINITIONS § 123.13 Domestic aircraft shipments via a
* * * * * foreign country.
■ 1. The authority citation for part 120 ■ 5. Section 123.9 is amended by
revising paragraphs (b)(1) and (2), and A license is not required for the
continues to read as follows: shipment by air of a defense article from
adding paragraph (d) to read as follows:
Authority: Secs. 2, 38, and 71, Pub. L. 90– one location in the United States to
629, 90 Stat. 744 (22 U.S.C. 2752, 2778, § 123.9 Country of ultimate destination another location in the United States via
2797); 22 U.S.C. 2794; 22 U.S.C. 2651a; Pub. and approval of reexports or retransfers. a foreign country.
L. 105–261, 112 Stat. 1920; Pub. L. 111–266;
Section 1261, Pub. L. 112–239; E.O. 13637,
* * * * *
(b) * * * PART 124—AGREEMENTS, OFF
78 FR 16129. SHORE PROCUREMENT, AND OTHER
(1) The exporter must incorporate the
■ 2. Section 120.5 is amended by DEFENSE SERVICES
following information as an integral part
revising the section heading and
of the bill of lading, air waybill, or other ■ 7. The authority citation for part 124
paragraph (b) to read as follows:
shipping document, and the purchase continues to read as follows:
§ 120.5 Relation to regulations of other documentation or invoice whenever
Authority: Sec. 2, 38, and 71, Pub. L. 90–
agencies; export of items subject to the defense articles are to be exported,
EAR. 629, 90 Stat. 744 (22 U.S.C. 2752, 2778,
retransferred, or reexported pursuant to 2797); 22 U.S.C. 2651a; 22 U.S.C. 2776; Pub.
* * * * * a license or other approval under this L. 105–261; Section 1261, Pub. L. 112–239;
(b) A license or other approval (see subchapter: E.O. 13637, 78 FR 16129.
§ 120.20) from the Department of State (i) The country of ultimate ■ 8. Section 124.7 is amended by
granted in accordance with this destination; designating the introductory text as
subchapter may also authorize the (ii) The end-user; paragraph (a), adding and reserving
export of items subject to the EAR (see (iii) The license or other approval paragraph (b), and revising paragraph
§ 120.42). Items subject to the EAR may number or exemption citation; and (a)(1) to read as follows:
be exported pursuant to an exemption (iv) The following statement: ‘‘These
(see parts 124, 125, and 126 of this items are controlled and authorized by § 124.7 Information required in all
subchapter), provided the items subject the U.S. government for export only to manufacturing license agreements and
to the EAR are for use in or with defense the country of ultimate destination for technical assistance agreements.
articles authorized under a license or use by the end-user herein identified. (a) * * *
other approval. Separate approval from They may not be resold, transferred, or (1) The agreement must describe the
the Department of Commerce is not otherwise be disposed of, to any other defense article to be manufactured and
required for these items when approved country or to any person other than the all defense articles to be exported,
for export under a Department of State authorized end-user or consignee(s), including any test and support
license or other approval. Those items either in their original form or after equipment or advanced materials. They
subject to the EAR exported pursuant to being incorporated into other items, should be described by military
a Department of State license or other without first obtaining approval from nomenclature, contract number,
approval would remain under the the U.S. government or as otherwise National Stock Number, nameplate data,
jurisdiction of the Department of authorized by U.S. law and or other specific information. Only
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Commerce for any subsequent regulations.’’ defense articles listed in the agreement
transactions. The inclusion of items (2) When exporting items subject to will be eligible for export under the
subject to the EAR on a Department of the EAR (see §§ 120.42 and 123.1(b) of exemption in § 123.16(b)(1) of this
State license or other approval does not this subchapter) pursuant to a subchapter. * * *
change the licensing jurisdiction of the Department of State license or other (b) [Reserved]
items. (See § 123.1(b) of this subchapter approval, the U.S. exporter must also ■ 9. Section 124.8 is amended by
for guidance on identifying items provide the end-user and consignees designating the introductory text as
subject to the EAR in a license with the appropriate EAR classification paragraph (a) and adding and reserving
application to the Department of State.) information for each item exported paragraph (b), as follows:

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29568 Federal Register / Vol. 80, No. 99 / Friday, May 22, 2015 / Proposed Rules

§ 124.8 Clauses required both in territories of the countries listed in § 126.4 Exports and temporary imports
manufacturing license agreements and paragraph (a)(2) of this section or the made to or on behalf of a department or
technical assistance agreements. United States. agency of the U.S. government.
* * * * * (b) Permanent retransfer of hardware (a) A license is not required for the
(b) [Reserved] is not authorized pursuant to paragraph export or temporary import of a defense
* * * * * (a) of this section. article or the performance of a defense
■ 10. Section 124.12 is amended by service, when made:
revising the introductory text of PART 125—LICENSES FOR THE (1) To a department or agency of the
EXPORT OF TECHNICAL DATA AND U.S. government for official use.
paragraph (a) to read as follows:
CLASSIFIED DEFENSE ARTICLES Defense articles exported or temporarily
§ 124.12 Required information in letters of
■ 13. The authority citation for part 126 imported under this provision may only
transmittal. be provided to a regular employee or
continues to read as follows:
(a) An application for the approval of contractor support personnel of the U.S.
a manufacturing license or technical Authority: Secs. 2 and 38, Pub. L. 90–629, government;
90 Stat. 744 (22 U.S.C. 2752, 2778); 22 U.S.C.
assistance agreement with a foreign 2651a; E.O. 13637, 78 FR 16129. Note 1 to paragraph (a): Contractor
person must be accompanied by an support personnel means those U.S. persons
■ 14. Section 125.2 is amended by
explanatory letter. The explanatory who provide administrative, managerial,
revising paragraph (a) to read as follows:
letter shall contain: scientific or technical support under contract
* * * * * § 125.2 Exports of unclassified technical with a U.S. government department or
data. agency within a U.S. government owned or
■ 11. Section 124.14 is amended by
operated facility or under the direct
revising the introductory text of (a) License. A license (DSP–5) is
supervision of a regular U.S. government
paragraph (e) to read as follows: required for the export of unclassified employee (e.g., Federally Funded Research
technical data unless the export is and Development Center or Systems
§ 124.14 Exports to warehouses or exempt from the licensing requirements Engineering and Technical Assistance
distribution points outside the United of this subchapter. In the case of a plant contractors). For purposes of this section,
States.
visit, details of the proposed discussions private security contractors are not
* * * * * must be transmitted to the Directorate of considered contractor support personnel, and
(e) Transmittal letters. Requests for Defense Trade Controls for an appraisal ‘‘direct supervision’’ refers to the control over
approval of warehousing and of the technical data. the manner and means in which contractor
distribution agreements with foreign support personnel conduct their day-to-day
* * * * * work activities as well as control over the
persons must be made by letter. The ■ 15. Section 125.7 is amended by
letter shall contain: contractor’s access to defense articles
revising paragraph (b) to read as follows: authorized under this paragraph.
* * * * *
■ 12. Section 124.16 is revised to read § 125.7 Procedures for the export of Note 2 to paragraph (a): Any retransfer,
as follows: classified technical data and other reexport, disposal, or change in end-user of
classified defense articles. a defense article exported pursuant to this
§ 124.16 Special retransfer authorizations * * * * * section must be performed in accordance
for unclassified defense articles and (b) An application for the export of with § 123.9 of this subchapter.
defense services to member states of NATO classified technical data or other
and the European Union, Australia, Japan, (2)(i) By, or on behalf of, a department
classified defense articles must be or agency of the U.S. government for
New Zealand, and Switzerland.
accompanied by a completed Form carrying out any foreign assistance,
(a) The provisions of § 124.8(a)(5) DSP–83 (see § 123.10 of this
notwithstanding, the Department may cooperative project, or sales program
subchapter). All classified materials authorized by law and subject to control
approve access to unclassified defense accompanying an application must be
articles and items subject to the EAR by the President by other means,
transmitted to the Directorate of Defense provided:
(see § 120.42 of this subchapter) Trade Controls in accordance with the (A) Items subject to the EAR and
exported in furtherance of or produced procedures contained in the Department controlled for missile technology (MT)
as a result of a TAA/MLA, retransfer of of Defense National Industrial Security reasons (see § 742.5 of the EAR (15 CFR
technical data and defense services, and Program Operating Manual (unless such 742.5) are not authorized for export
retransfer of technology subject to the requirements are inconsistent with under this subsection; and
EAR and authorized under a TAA/MLA, guidance provided by the Directorate of (B) The United States government
to individuals who are dual national or Defense Trade Controls, in which case performs or directs all aspects of the
third-country national employees of the the latter guidance must be followed). transaction (export, carriage, and
foreign signatory or its approved sub-
delivery abroad) or the export is covered
licensees, provided that: PART 126—GENERAL POLICIES AND by a U.S. government Bill of Lading.
(1) The transfer is to dual nationals or PROVISIONS (ii) This section does not authorize a
third-country nationals who are bona U.S. government agency to act as a
fide regular employees, directly ■ 16. The authority citation for part 126
continues to read as follows: transmittal agent on behalf of a private
employed by the foreign signatory or individual or firm, either as a
approved sub-licensees; Authority: Secs. 2, 38, 40, 42, and 71, Pub.
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L. 90–629, 90 Stat. 744 (22 U.S.C. 2752, 2778, convenience or in satisfaction of
(2) The individuals are exclusively of security requirements.
countries that are members of NATO, 2780, 2791, and 2797); 22 U.S.C. 2651a; 22
U.S.C. 287c; E.O. 12918, 59 FR 28205; 3 CFR, Note to paragraph (a)(2): Approval of a
the European Union, Australia, Japan, 1994 Comp., p. 899; Sec. 1225, Pub. L. 108–
New Zealand, and Switzerland; foreign assistance, cooperative project, or
375; Sec. 7089, Pub. L. 111–117; Pub. L. 111– sales program authorizing a U.S. government
(3) Their employer is a signatory to 266; Section 7045, Pub. L. 112–74; Section department and agency to permanently
the agreement or has executed a Non- 7046, Pub. L. 112–74; E.O. 13637, 78 FR export a defense article described on the
Disclosure Agreement; and 16129. Missile Technology Control Regime Annex
(4) The retransfer takes place ■ 17. Section 126.4 is revised to read as should be reviewed by the Missile
completely within the physical follows: Technology Export Committee, unless

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Document Created: 2015-12-15 15:44:56
Document Modified: 2015-12-15 15:44:56
Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Proposed Rules
Action		Proposed rule.
Dates		The Department of State will accept comments on this proposed rule until July 6, 2015.
Contact		Mr. C. Edward Peartree, Director, Office of Defense Trade Controls Policy, Department of State, telephone (202) 663-2792; email [email protected] ATTN: ITAR Amendment--To or on behalf of. The Department of State's full retrospective plan can be accessed at http://www.state.gov/documents/ organization/181028.pdf.
FR Citation		80 FR 29565
RIN Number		1400-AC88
CFR Citation		22 CFR 120 22 CFR 123 22 CFR 124 22 CFR 125 22 CFR 126
CFR Associated		Arms and Munitions; Classified Information; Exports; Reporting and Recordkeeping Requirements and Technical Assistance