SUPPLEMENTARY INFORMATION:

The preamble to this temporary final rule consists of four sections:

I. Legal Authorities

II. Provisions of the Temporary Final Rule

III. Request for Comment

IV. Rulemaking Requirements

I. Legal Authorities

BIS administers the DPAS regulation which implements the priorities and allocations authority under Title I of the DPA (50 U.S.C. 4501, et seq.), with respect to all materials, services, and facilities, including construction materials, not delegated to other ( printed page 50702) Secretaries under Executive Order (“E.O.”) 13603. These materials, services, and facilities are referred to as “industrial resources.”

On July 30, 2026, the President issued DPA Determination on Recoverable CMMs. Under DPA Determination on Recoverable CMMs, the President found that certain recoverable CMMs are scarce and critical materials essential to the national defense. The President stated that the inadequate supply of CMMs poses an increasing risk to our national defense and security, and it is imperative that the United States take immediate action to secure the supply of recoverable CMMs. Accordingly, pursuant to section 101 of the DPA, the President found that recoverable CMMs meet the criteria specified in section 101(b) of the DPA (50 U.S.C. 4511(b)). With these findings, the President authorized the Secretary of Commerce (“Secretary”) to use the Secretary's delegated authority under E.O. 13603 of March 12, 2012 (National Defense Resources Preparedness) to implement this determination by taking all appropriate action under section 101 of the DPA.

II. Provisions of the Temporary Final Rule

BIS has determined that sales by U.S. persons of certain scarce materials identified in DPA Determination on Recoverable CMMs shall be allocated to U.S. persons through an Allocation Order, which are described in pursuant to Subpart F of Part 700 (DPAS). Consistent with section 709(b)(2) of the DPA (50 U.S.C. 4559(b)(2)), this Allocation Order and associated necessary conforming revisions to the DPAS regulations are published as a temporary final rule because BIS has determined that urgent and compelling circumstances make compliance with prior notice and opportunity for public comment impracticable. This temporary rule is necessary to immediately secure the supply of certain recoverable CMMs to ensure an adequate supply of these materials deemed essential to the national defense, as required by the President under DPA Determination on Recoverable CMMs.

Specifically, BIS is publishing this temporary final rule to implement a Directive Allocation Order, as described in § 700.33 (Types of allocation orders) in the DPAS. The industrial resources specified in the Directive Allocation Order may not be exported from the United States without explicit authorization by BIS. This Directive Allocation Order and the associated regulatory revisions in this temporary final rule expire one year from its effective date, unless adjusted or extended by BIS prior to the expiration date in a Federal Register publication.

A. Regulatory Revisions

BIS is revising § 700.34 of the DPAS to add new paragraph (d), to include a provision to issue allocation orders through a temporary final rule in the Federal Register . In addition, BIS is adding new supplement no. 1 to part 700 to issue a Directive Allocation Order pursuant to new paragraph § 700.34(d). The new supplement includes:

• Information regarding scope and definition of terms that apply solely to the Directive Allocation Order issued by publication of this temporary final rule (and not to other provisions within the DPAS);
• Adjustment and exceptions requirements for this Directive Allocation Order issued by a temporary final rule;
• Additional compliance guidance; and
• A table that identifies the scarce and critical materials deemed essential to national defense under DPA Determination on Recoverable CMMs, identified by 10-digit Schedule B codes and accompanying description. The table includes the monthly domestic sales requirement percentage, as well as effective date and expiration date of this Directive Allocation Order.

The provisions in the supplement apply solely to the Directive Allocation Order and do not apply to other official actions taken pursuant to the DPAS. Additionally, BIS is making conforming changes to §§ 700.8 (Definitions) and 700.80 (Adjustments or exceptions) to include reference to supplement no. 1 to part 700 and the specific provisions that are exclusively required for allocation orders issued through a temporary final rule in the Federal Register in new supplement no. 1 to part 700.

B. Directive Allocation Order Requirements for Black Mass and Tungsten Waste and Scrap

U.S. persons engaged in the sale of materials described and identified by Schedule B codes listed in Table 1 of this supplement are required to comply with this order, in accordance with the provisions of the Defense Priorities and Allocations System regulation (15 CFR part 700).

As of August 27, 2026, U.S. persons engaged in the sale of `black mass' and tungsten waste and scrap, must allocate 100 percent of monthly sales to U.S. persons, as specified in new supplement no. 1 to part 700 of the DPAS. For purposes of this Directive Allocation Order, “black mass” means any shredded lithium-ion battery scrap that contains cathode material (which may include lithium, cobalt, nickel and manganese), anode material (graphite, silicon) or other residual battery cell materials.

Accordingly, starting August 27, 2026, U.S. persons engaged in the sale of black mass (Schedule B codes 8549.13.00.00, 8549.14.00.00, and 8549.19.00.00) and tungsten waste and scrap (Schedule B code 8101.97.00.00) must allocate 100 percent of monthly sales to U.S. persons (referred to as a “domestic sales requirement”), unless an exception or adjustment is granted by BIS, as described in Section II.C of this temporary final rule. The domestic sales requirement for electrical and electronic waste and scrap: waste and scrap of primary cells, primary batteries and electric accumulators; spent primary cells, spent primary batteries and spent electric accumulators: sorted by chemical type and not containing lead, cadmium or mercury (Schedule B code 8549.13.00.00); electrical and electronic waste and scrap: waste and scrap of primary cells, primary batteries and electric accumulators; spent primary cells, spent primary batteries and spent electric accumulators: unsorted and not containing lead, cadmium or mercury (Schedule B code 8549.14.00.00); and electrical and electronic waste and scrap: waste and scrap of primary cells, primary batteries and electric accumulators; spent primary cells, spent primary batteries and spent electric accumulators: other (Schedule B code 8549.19.00.00) are limited to materials that meet the definition of “black mass”, as defined in supplement no. 1 to part 700. Materials under these Schedule B codes that do not meet this definition of “black mass” are not subject to this Directive Allocation Order.

Therefore, starting August 27, 2026, “black mass” (Schedule B codes 8549.13.00.00, 8549.14.00.00, and 8549.19.00.00) and tungsten waste and scrap (Schedule B code 8101.97.00.00) must remain physically located within the United States, unless otherwise authorized by BIS. U.S. persons must continue to fill DPAS rated orders for covered black mass and tungsten waste and scrap from U.S. persons in accordance with the DPAS regulations. In accordance with new Supplement no. 1 to part 700(c), implemented through this temporary final rule, BIS may grant exceptions or adjustments on a case-by-case basis to allow sales to non-U.S. persons, notwithstanding the domestic sales requirement. ( printed page 50703)

C. Authorizations for Adjustments and Exceptions

While Subpart K of the DPAS describes the Adjustments, Exceptions and Appeals process, U.S. persons who are subject to the domestic sales requirement for “black mass” and tungsten waste and scrap must submit a request for an adjustment or exception, following the process described in new supplement no. 1 to part 700(c). BIS may authorize both company-specific and generally applicable adjustments or exceptions from the sale requirement at its discretion, consistent with the determination that the restrictions covered by this rule are necessary or appropriate to promote the national defense. In addition, BIS may authorize interim relief— i.e., a DPAS temporary license—while a request is pending. A DPAS temporary license or other type of approval which provides authorization from BIS for an adjustment or exception to this Directive Allocation Order is neither equivalent to nor replaces licenses or other authorizations to export, reexport, or transfer (in-country) commodities, technology, or software pursuant to the Export Administration Regulations (15 CFR parts 730-774). Persons granted a DPAS license or DPAS temporary license under the Directive Allocation Order must otherwise adhere to U.S. export control regulations.

BIS will consider granting adjustments, exceptions, or interim relief for this Directive Allocation Order for the following scenarios, among others:

• The domestic sales requirement results in an undue or exceptional hardship on that person not suffered generally by others in similar situations and circumstances.
• The consequence of complying with the domestic sales requirement is contrary to the intent of the DPA or this part—for example, because it would reduce the domestic supply of CMMs.
• A U.S. person plans to sell black mass and tungsten waste and scrap to a person located outside the United States for processing or refining, and then the processed/refined material will be returned to the United States.
• Compliance with the domestic sales requirement will result in irreparable harm to a U.S. person who is subject to the order.
• Additional time is needed to comply with the domestic sales requirements.

Requests for adjustments and exceptions must be made in writing and provided to BIS via DPASAllocations@bis.doc.gov. Each request for adjustment or exception must contain a complete statement of all the facts and circumstances related to the domestic sales requirement from which relief is sought, and a full and precise statement of the reasons why relief should be provided; and relevant supporting documents or data to support the request.

The submission of a request for adjustment or exception shall not relieve any person from the obligation of complying with the domestic sales requirement while the request is being considered, unless such interim relief is granted in writing. BIS intends to respond to requests for adjustment of or exceptions to compliance with the domestic sales requirement within 14 days of the date of receipt. An appeal for a decision under this section may be made in accordance with 15 CFR 700.81. For more information regarding adjustments and exception requests, please refer to 15 CFR 700.80.

D. Compliance and Procedures

Compliance provisions in Subpart J of the DPAS continue to apply. U.S. persons are required to comply with allocation orders and the terms of any adjustment or exception authorizations granted, in accordance with 15 CFR 700.35. Further, in accordance with 15 CFR 700.90, section 707 of the DPA (50 U.S.C. 4557), and to the fullest extent consistent with applicable law, a person shall not be held liable for damages or penalties for any act or failure to act resulting directly or indirectly from compliance with the DPAS regulation, or this Directive Allocation Order, notwithstanding that such provision or action shall subsequently be declared invalid by judicial or other competent authority.

If a U.S. person is unable to comply fully with the required action(s) specified in an allocation order, the U.S. person must notify BIS immediately in writing, explain the extent to which compliance is possible, and give the reasons why full compliance is not possible. Written notification must be provided to BIS via DPASAllocations@bis.doc.gov. If notification is given verbally to BIS via 202-482-3634, written or electronic confirmation must be provided to BIS within one working day via DPASAllocations@bis.doc.gov. Such notification does not release the U.S. person from complying with the order to the fullest extent possible, until the U.S. person is notified by BIS that the order has been changed or cancelled.

BIS will implement this temporary final rule with the cooperation and assistance of other U.S. Government agencies, including U.S. Customs and Border Protection (CBP). Any covered materials intended for export may be detained by CBP while BIS conducts its review of the shipment. BIS will review the shipment and provide notification as soon as possible regarding the disposition of the covered materials under this Directive Allocation Order, provided that any goods that have been detained by CBP and are subsequently made subject to a DPAS rated order will be consigned to BIS pending further distribution or agency direction. BIS may provide additional guidance regarding the application of any exemptions to this temporary final rule, as appropriate.

BIS may conduct investigations and issue requests for information as may be necessary for the enforcement of the Act, the DPAS regulations, and this Directive Allocation Order. See15 CFR 700.71; see also section 705 of the Act, 50 U.S.C. 4555. BIS may also seek an injunction or other order in accordance with 15 CFR 700.74(b). See also section 706 of the Act, 50 U.S.C. 4556. In addition to an injunction, failure to comply fully with this temporary final rule is punishable in accordance with 15 CFR 700.74(a). See also sections 103 and 705 of the Act, 50 U.S.C. 4513 and 4555.

At any point in time, and to the extent consistent with United States policy, BIS may determine that additional materials identified in DPA Determination on Recoverable CMMs be subject to an allocation order. BIS may add additional materials to this Directive Allocation Order and will provide notification of this decision through publication in the Federal Register .

III. Request for Comments

While this temporary final rule is effective on publication, BIS requests comments on whether any additional sales requirements are necessary or appropriate to promote the national defense. In addition, BIS also welcomes comments on the framework of the temporary regulatory provisions added to the DPAS.

IV. 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, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of ( printed page 50704) quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This temporary final rule has been determined to be a “significant regulatory action,” although not economically significant, under section 3(f) of Executive Order 12866. This temporary final rule is exempt from Executive Order 14192 because it is being issued with respect to a national security function of the United States.

2. This rule does not contain policies with Federalism implications as that term is defined in Executive Order 13132.

3. This rule is exempt from the Administrative Procedures Act (APA) ( See5 U.S.C. 553) and is published as a temporary rule with immediate effective date. Agency rulemaking is generally governed by the agency rulemaking provisions of the APA and such provisions generally require that, unless the rule falls within one of a number of enumerated exceptions, or unless another statute exempts the rulemaking from the requirements of the APA, BIS must publish a notice of proposed rulemaking in the Federal Register that provides interested persons an opportunity to submit written data, views, or arguments, prior to finalization of regulatory requirements.

Pursuant to section 709(a) of the Act, 50 U.S.C. 4559(a), this rule is exempt from the rulemaking provisions of the APA, sections 5 U.S.C. 551-559. While section 709(b)(1) of the Act, 50 U.S.C. 4559(b)(1) requires agencies to promulgate regulations under that section by providing notice and opportunity for public comment “consistent with section 553(b)”, section 709(b)(2) directs agencies to waive the requirements of 5 U.S.C. 553(b) if (A) the officer authorized to issue the regulation finds that urgent and compelling circumstances make compliance with such requirements impracticable; (B) the regulation is issued on a temporary basis; and (C) the publication of such temporary regulation is accompanied by the finding made under subparagraph (A) (and a brief statement of the reasons for such finding) and an opportunity for public comment is provided for not less than 30 days before any regulation becomes final. Based on the findings in DPA Determination on Recoverable CMMs, which already have been summarized in this document, the Under Secretary for Industry and Security has determined “that urgent and compelling circumstances make compliance” with the notice and comment requirements of section 709(b)(1) of the Act, 50 U.S.C. 4559(b)(1), “impracticable.” An opportunity for public comment is being provided now for a period of 90 days, which shall ensure that a minimum 30-day public comment period is provided before any provisions of this temporary final rule “become final,” i.e. without an expiration date, pursuant to section 709(b)(2)(C) of the Act, 50 U.S.C. 4559(b)(2)(C).

America's inadequate supply of CMMs poses an increasing risk to our national defense and security. The United States relies heavily on imports of certain CMMs commodities from foreign sources, and this reliance threatens serious, sustained supply chain disruptions. It is imperative that the United States take immediate action to secure the supply of recoverable CMMs by allocating a percentage of sales of specific recoverable CMMs to U.S. persons.

The measures described in this rule are being issued on a temporary basis. This temporary rule will cease to be in effect on August 27, 2027.

4. Because a notice of proposed rulemaking and an opportunity for public comment are not required to be given for this rule under the APA (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. The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) provides that an agency generally cannot conduct or sponsor a collection of information, and no person is required to respond to nor be subject to a penalty for failure to comply with a collection of information, unless that collection has obtained Office of Management and Budget (OMB) approval and displays a currently valid OMB Control Number.

On July 30, 2026, the President issued a Presidential Determination titled “Presidential Determination Pursuant to Section 101 of the Defense Production Act of 1950, as Amended, on Recoverable Critical Minerals and Materials” (“DPA Determination on Recoverable CMMs”). Under DPA Determination on Recoverable CMMs, the President found that recoverable critical minerals and materials (CMMs) are scarce and critical materials essential to the national defense, meeting the criteria specified in section 101(b) of the DPA (50 U.S.C. 4501, et seq.). Per DPA Determination on Recoverable CMMs, the President found that America's inadequate supply of CMMs poses an increasing risk to our national defense and security and directed the Secretary to take immediate action to secure the supply of recoverable CMMs.

BIS cannot reasonably comply with the normal PRA clearance process as a delay in BIS's ability to begin immediate information collection from companies engaged in the sale of recoverable CMMs to ensure a continued and adequate supply of these items, which are scarce and critical materials essential to the national defense. The Department has determined the following conditions have been met:

a. The collection of information is needed prior to the expiration of time periods normally associated with a routine submission for review under the provisions of the Paperwork Reduction Act in view of DPA Determination on Recoverable CMMs, www.whitehouse.gov/​presidential-actions/​2026/​07/​presidential-determination-pursuant-to-section-101-of-the-defense-production-act-of-1950-as-amended-on-recoverable-critical-minerals-and-materials/​.

b. The collection of information is essential to the mission of the Department, in particular to promote the national defense; and to allocate materials, services, and facilities in such a manner, upon such conditions, and to such extent as the President shall deem necessary or appropriate to promote the national defense, as defined in the DPA.

c. Public harm is reasonably likely to result if BIS were to follow the normal clearance procedures before issuing this information collection. A delay in BIS's ability to begin immediate information collection from companies engaged in the sale of recoverable CMMs will lead to increased scarcity of these materials through additional exports, posing an imminent threat to U.S. military readiness and critical infrastructure sectors. BIS is required to issue official actions under the DPAS regulation and collect certain critical information from companies engaged in the sale of recoverable CMMs to effectuate DPA Determination on Recoverable CMMs and ensure compliance with the DPAS regulation and the official actions issued, as described in sections 700.80, 700.81, and 700.91 of the DPAS regulation. These collection requirements may include buyer information, the applicable material and Schedule B code, quantity of material, and value of the sale. BIS may issue additional allocation orders as required to meet the objectives of DPA Determination on Recoverable CMMs.

For the reasons stated above, BIS has requested, and OMB has granted, a new information collection for this rule under OMB control number 0694-0148 ( printed page 50705) with the title Directive Allocation Orders under the Defense Priorities and Allocations System in Response to Presidential Determination on Recoverable Critical Minerals and Materials. All materials for the currently approved collection can be accessed at www.reginfo.gov. Separately, BIS will be publishing a 60 day notice to take comment on the emergency collection.

For the reasons set forth in the preamble, part 700 of subchapter A of 15 CFR chapter VII is amended as follows:

91 FR 50701