Congressional Record: September 4, 2001 (Senate)
Page S9018-S9065
EXPORT ADMINISTRATION ACT OF 2001
The PRESIDING OFFICER. Under the previous order, the Senate will now
begin consideration of S. 149, which the clerk will report.
The legislative clerk read as follows:
A bill (S. 149) to provide authority to control exports and
for other purposes.
The Senate proceeded to consider the bill, which had been reported
from the Committee on Banking, Housing, and Urban Affairs, with an
amendment to strike all after the enacting clause and insert in lieu
thereof the following:
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Export
Administration Act of 2001''.
(b) Table of Contents.--The table of contents of this Act
is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
TITLE I--GENERAL AUTHORITY
Sec. 101. Commerce Control List.
Sec. 102. Delegation of authority.
Sec. 103. Public information; consultation requirements.
[[Page S9019]]
Sec. 104. Right of export.
Sec. 105. Export control advisory committees.
Sec. 106. President's Technology Export Council.
Sec. 107. Prohibition on charging fees.
TITLE II--NATIONAL SECURITY EXPORT CONTROLS
Subtitle A--Authority and Procedures
Sec. 201. Authority for national security export controls.
Sec. 202. National Security Control List.
Sec. 203. Country tiers.
Sec. 204. Incorporated parts and components.
Sec. 205. Petition process for modifying export status.
Subtitle B--Foreign Availability and Mass-Market Status
Sec. 211. Determination of foreign availability and mass-market status.
Sec. 212. Presidential set-aside of foreign availability status
determination.
Sec. 213. Presidential set-aside of mass-market status determination.
Sec. 214. Office of Technology Evaluation.
TITLE III--FOREIGN POLICY EXPORT CONTROLS
Sec. 301. Authority for foreign policy export controls.
Sec. 302. Procedures for imposing controls.
Sec. 303. Criteria for foreign policy export controls.
Sec. 304. Presidential report before imposition of control.
Sec. 305. Imposition of controls.
Sec. 306. Deferral authority.
Sec. 307. Review, renewal, and termination.
Sec. 308. Termination of controls under this title.
Sec. 309. Compliance with international obligations.
Sec. 310. Designation of countries supporting international terrorism.
Sec. 311. Crime control instruments.
TITLE IV--PROCEDURES FOR EXPORT LICENSES AND INTERAGENCY DISPUTE
RESOLUTION
Sec. 401. Export license procedures.
Sec. 402. Interagency dispute resolution process.
TITLE V--INTERNATIONAL ARRANGEMENTS; FOREIGN BOYCOTTS; SANCTIONS; AND
ENFORCEMENT
Sec. 501. International arrangements.
Sec. 502. Foreign boycotts.
Sec. 503. Penalties.
Sec. 504. Missile proliferation control violations.
Sec. 505. Chemical and biological weapons proliferation sanctions.
Sec. 506. Enforcement.
Sec. 507. Administrative procedure.
TITLE VI--EXPORT CONTROL AUTHORITY AND REGULATIONS
Sec. 601. Export control authority and regulations.
Sec. 602. Confidentiality of information.
TITLE VII--MISCELLANEOUS PROVISIONS
Sec. 701. Annual report.
Sec. 702. Technical and conforming amendments.
Sec. 703. Savings provisions.
SEC. 2. DEFINITIONS.
In this Act:
(1) Affiliate.--The term ``affiliate'' includes both
governmental entities and commercial entities that are
controlled in fact by the government of a country.
(2) Control or controlled.--The terms ``control'' and
``controlled'' mean any requirement, condition,
authorization, or prohibition on the export or reexport of an
item.
(3) Control list.--The term ``Control List'' means the
Commerce Control List established under section 101.
(4) Controlled country.--The term ``controlled country''
means a country with respect to which exports are controlled
under section 201 or 301.
(5) Controlled item.--The term ``controlled item'' means an
item the export of which is controlled under this Act.
(6) Country.--The term ``country'' means a sovereign
country or an autonomous customs territory.
(7) Country supporting international terrorism.--The term
``country supporting international terrorism'' means a
country designated by the Secretary of State pursuant to
section 310.
(8) Department.--The term ``Department'' means the
Department of Commerce.
(9) Export.--
(A) The term ``export'' means--
(i) an actual shipment, transfer, or transmission of an
item out of the United States;
(ii) a transfer to any person of an item either within the
United States or outside of the United States with the
knowledge or intent that the item will be shipped,
transferred, or transmitted to an unauthorized recipient
outside the United States; or
(iii) a transfer of an item in the United States to an
embassy or affiliate of a country, which shall be considered
an export to that country.
(B) The term includes a reexport.
(10) Foreign availability status.--The term ``foreign
availability status'' means the status described in section
211(d)(1).
(11) Foreign person.--The term ``foreign person'' means--
(A) an individual who is not--
(i) a United States citizen;
(ii) an alien lawfully admitted for permanent residence to
the United States; or
(iii) a protected individual as defined in section
274B(a)(3) of the Immigration and Nationality Act. (8 U.S.C.
1324b(a)(3));
(B) any corporation, partnership, business association,
society, trust, organization, or other nongovernmental entity
created or organized under the laws of a foreign country or
that has its principal place of business outside the United
States; and
(C) any governmental entity of a foreign country.
(12) Item.--
(A) In general.--The term ``item'' means any good,
technology, or service.
(B) Other definitions.--In this paragraph:
(i) Good.--The term ``good'' means any article, natural or
manmade substance, material, supply or manufactured product,
including inspection and test equipment, including source
code, and excluding technical data.
(ii) Technology.--The term ``technology'' means specific
information that is necessary for the development,
production, or use of an item, and takes the form of
technical data or technical assistance.
(iii) Service.--The term ``service'' means any act of
assistance, help or aid.
(13) Mass-market status.--The term ``mass-market status''
means the status described in section 211(d)(2).
(14) Multilateral export control regime.--The term
``multilateral export control regime'' means an international
agreement or arrangement among two or more countries,
including the United States, a purpose of which is to
coordinate national export control policies of its members
regarding certain tems. The term includes regimes such as the
Australia Group, the Wassenaar Arrangement, the Missile
Technology Control Regime (MTCR), and the Nuclear Suppliers'
Group Dual Use Arrangement.
(15) National security control list.--The term ``National
Security Control List'' means the list established under
section 202(a).
(16) Person.--The term ``person'' includes--
(A) any individual, or partnership, corporation, business
association, society, trust, organization, or any other group
created or organized under the laws of a country; and
(B) any government, or any governmental entity, including
any governmental entity operating as a business enterprise.
(17) Reexport.--The term ``reexport'' means the shipment,
transfer, transshipment, or diversion of items from one
foreign country to another.
(18) Secretary.--The term ``Secretary'' means the Secretary
of Commerce.
(19) United states.--The term ``United States'' means the
States of the United States, the District of Columbia, and
any commonwealth, territory, dependency, or possession of the
United States, and includes the outer Continental Shelf, as
defined in section 2(a) of the Outer Continental Shelf Lands
Act (42 U.S.C. 1331(a)).
(20) United states person.--The term ``United States
person'' means--
(A) any United States citizen, resident, or national (other
than an individual resident outside the United States who is
employed by a person other than a United States person);
(B) any domestic concern (including any permanent domestic
establishment of any foreign concern); and
(C) any foreign subsidiary or affiliate (including any
permanent foreign establishment) of any domestic concern
which is controlled in fact by such domestic concern, as
determined under regulations prescribed by the President.
TITLE I--GENERAL AUTHORITY
SEC. 101. COMMERCE CONTROL LIST.
(a) In General.--Under such conditions as the Secretary may
impose, consistent with the provisions of this Act, the
Secretary--
(1) shall establish and maintain a Commerce Control List
(in this Act referred to as the ``Control List'') consisting
of items the export of which are subject to licensing or
other authorization or requirement; and
(2) may require any type of license, or other
authorization, including recordkeeping and reporting,
appropriate to the effective and efficient implementation of
this Act with respect to the export of an item on the Control
List or otherwise subject to control under title II or III of
this Act.
(b) Types of License or Other Authorization.--The types of
license or other authorization referred to in subsection
(a)(2) include the following:
(1) Specific exports.--A license that authorizes a specific
export.
(2) Multiple exports.--A license that authorizes multiple
exports in lieu of a license for each export.
(3) Notification in lieu of license.-- A notification in
lieu of a license that authorizes a specific export or
multiple exports subject to the condition that the exporter
file with the Department advance notification of the intent
to export in accordance with regulations prescribed by the
Secretary.
(4) License exception.--Authority to export an item on the
Control List without prior license or notification in lieu of
a license.
(c) After-Market Service and Replacement Parts.--A license
to export an item under this Act shall not be required for an
exporter to provide after-market service or replacement parts
in order to replace on a one-for-one basis parts that were in
an item that was lawfully exported from the United States,
unless--
(1) the Secretary determines that such license is required
to export such parts; or
(2) the after-market service or replacement parts would
materially enhance the capability of an item which was the
basis for the item being controlled.
(d) Incidental Technology.--A license or other
authorization to export an item under this Act includes
authorization to export technology related to the item, if
the level of the technology does not exceed the minimum
necessary to install, repair, maintain, inspect, operate, or
use the item.
(e) Regulations.--The Secretary may prescribe such
regulations as are necessary to carry out the provisions of
this Act.
[[Page S9020]]
SEC. 102. DELEGATION OF AUTHORITY.
(a) In General.--Except as provided in subsection (b) and
subject to the provisions of this Act, the President may
delegate the power, authority, and discretion conferred upon
the President by this Act to such departments, agencies, and
officials of the Government as the President considers
appropriate.
(b) Exceptions.--
(1) Delegation to appointees confirmed by senate.--No
authority delegated to the President under this Act may be
delegated by the President to, or exercised by, any official
of any department or agency the head of which is not
appointed by the President, by and with the advice and
consent of the Senate.
(2) Other limitations.--The President may not delegate or
transfer the President's power, authority, or discretion to
overrule or modify any recommendation or decision made by the
Secretary, the Secretary of Defense, or the Secretary of
State under this Act.
SEC. 103. PUBLIC INFORMATION; CONSULTATION REQUIREMENTS.
(a) Public Information.--The Secretary shall keep the
public fully informed of changes in export control policy and
procedures instituted in conformity with this Act.
(b) Consultation With Persons Affected.--The Secretary
shall consult regularly with representatives of a broad
spectrum of enterprises, labor organizations, and citizens
interested in or affected by export controls in order to
obtain their views on United States export control policy and
the foreign availability or mass-market status of controlled
items.
SEC. 104. RIGHT OF EXPORT.
No license or other authorization to export may be required
under this Act, or under regulations issued under this Act,
except to carry out the provisions of this Act.
SEC. 105. EXPORT CONTROL ADVISORY COMMITTEES.
(a) Appointment.--Upon the Secretary's own initiative or
upon the written request of representatives of a substantial
segment of any industry which produces any items subject to
export controls under this Act or being considered for such
controls, the Secretary may appoint export control advisory
committees with respect to any such items. Each such
committee shall consist of representatives of United States
industry and Government officials, including officials from
the Departments of Commerce, Defense, and State, and other
appropriate departments and agencies of the Government. The
Secretary shall permit the widest possible participation by
the business community on the export control advisory
committees.
(b) Functions.--
(1) In general.--Export control advisory committees
appointed under subsection (a) shall advise and assist the
Secretary, and any other department, agency, or official of
the Government carrying out functions under this Act, on
actions (including all aspects of controls imposed or
proposed) designed to carry out the provisions of this Act
concerning the items with respect to which such export
control advisory committees were appointed.
(2) Other consultations.--Nothing in paragraph (1) shall
prevent the United States Government from consulting, at any
time, with any person representing an industry or the general
public, regardless of whether such person is a member of an
export control advisory committee. Members of the public
shall be given a reasonable opportunity, pursuant to
regulations prescribed by the Secretary, to present
information to such committees.
(c) Reimbursement of Expenses.--Upon the request of any
member of any export control advisory committee appointed
under subsection (a), the Secretary may, if the Secretary
determines it to be appropriate, reimburse such member for
travel, subsistence, and other necessary expenses incurred by
such member in connection with the duties of such member.
(d) Chairperson.--Each export control advisory committee
appointed under subsection (a) shall elect a chairperson, and
shall meet at least every 3 months at the call of the
chairperson, unless the chairperson determines, in
consultation with the other members of the committee, that
such a meeting is not necessary to achieve the purposes of
this section. Each such committee shall be terminated after a
period of 2 years, unless extended by the Secretary for
additional periods of 2 years each. The Secretary shall
consult with each such committee on such termination or
extension of that committee.
(e) Access to Information.--To facilitate the work of the
export control advisory committees appointed under subsection
(a), the Secretary, in conjunction with other departments and
agencies participating in the administration of this Act,
shall disclose to each such committee adequate information,
consistent with national security and intelligence sources
and methods, pertaining to the reasons for the export
controls which are in effect or contemplated for the items or
policies for which that committee furnishes advice.
Information provided by the export control advisory
committees shall not be subject to disclosure under section
552 of title 5, United States Code, and such information
shall not be published or disclosed unless the Secretary
determines that the withholding thereof is contrary to the
national interest.
SEC. 106. PRESIDENT'S TECHNOLOGY EXPORT COUNCIL.
The President may establish a President's Technology Export
Council to advise the President on the implementation,
operation, and effectiveness of this Act.
SEC. 107. PROHIBITION ON CHARGING FEES.
No fee may be charged in connection with the submission or
processing of an application for an export license under this
Act.
TITLE II--NATIONAL SECURITY EXPORT CONTROLS
Subtitle A--Authority and Procedures
SEC. 201. AUTHORITY FOR NATIONAL SECURITY EXPORT CONTROLS.
(a) Authority.--
(1) In general.--In order to carry out the purposes set
forth in subsection (b), the President may, in accordance
with the provisions of this Act, prohibit, curtail, or
require a license, or other authorization for the export of
any item subject to the jurisdiction of the United States or
exported by any person subject to the jurisdiction of the
United States. The President may also require recordkeeping
and reporting with respect to the export of such item.
(2) Exercise of authority.--The authority contained in this
subsection shall be exercised by the Secretary, in
consultation with the Secretary of Defense, the intelligence
agencies, and such other departments and agencies as the
Secretary considers appropriate.
(b) Purposes.--The purposes of national security export
controls are the following:
(1) To restrict the export of items that would contribute
to the military potential of countries so as to prove
detrimental to the national security of the United States,
its allies or countries sharing common strategic objectives
with the United States.
(2) To stem the proliferation of weapons of mass
destruction, and the means to deliver them, and other
significant military capabilities by--
(A) leading international efforts to control the
proliferation of chemical and biological weapons, nuclear
explosive devices, missile delivery systems, key-enabling
technologies, and other significant military capabilities;
(B) controlling involvement of United States persons in,
and contributions by United States persons to, foreign
programs intended to develop weapons of mass destruction,
missiles, and other significant military capabilities, and
the means to design, test, develop, produce, stockpile, or
use them; and
(C) implementing international treaties or other agreements
or arrangements concerning controls on exports of designated
items, reports on the production, processing, consumption,
and exports and imports of such items, and compliance with
verification programs.
(3) To deter acts of international terrorism.
(c) End Use and End User Controls.--Notwithstanding any
other provision of this title, controls may be imposed, based
on the end use or end user, on the export of any item, that
could contribute to the proliferation of weapons of mass
destruction or the means to deliver them.
(d) Enhanced Controls.--
(1) In general.--Notwithstanding any other provisions of
this title, the President may determine that applying the
provisions of section 204 or 211 with respect to an item on
the National Security Control List would constitute a
significant threat to the national security of the United
States and that such item requires enhanced control. If the
President determines that enhanced control should apply to
such item, the item may be excluded from the provisions of
section 204, section 211, or both, until such time as the
President shall determine that such enhanced control should
no longer apply to such item. The President may not delegate
the authority provided for in this subsection.
(2) Report to congress.--The President shall promptly
report any determination described in paragraph (1), along
with the specific reasons for the determination, to the
Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on International Relations of the
House of Representatives.
SEC. 202. NATIONAL SECURITY CONTROL LIST.
(a) Establishment of List.--
(1) Establishment.--The Secretary shall establish and
maintain a National Security Control List as part of the
Control List.
(2) Contents.--The National Security Control List shall be
composed of a list of items the export of which is controlled
for national security purposes under this title.
(3) Identification of items for national security control
list.--The Secretary, with the concurrence of the Secretary
of Defense and in consultation with the head of any other
department or agency of the United States that the Secretary
considers appropriate, shall identify the items to be
included on the National Security Control List provided that
the National Security Control List shall, on the date of
enactment of this Act, include all of the items on the
Commerce Control List controlled on the day before the date
of enactment of this Act to protect the national security of
the United States, to prevent the proliferation of weapons of
mass destruction and the means to deliver them, and to deter
acts of international terrorism. The Secretary shall review
on a continuing basis and, with the concurrence of the
Secretary of Defense and in consultation with the head of any
other department or agency of the United States that the
Secretary considers appropriate, adjust the National Security
Control List to add items that require control under this
section and to remove items that no longer warrant control
under this section.
(b) Risk Assessment.--
(1) Requirement.--In establishing and maintaining the
National Security Control List, the risk factors set forth in
paragraph (2) shall be considered, weighing national security
concerns and economic costs.
(2) Risk factors.--The risk factors referred to in
paragraph (1), with respect to each item, are as follows:
(A) The characteristics of the item.
(B) The threat, if any, to the United States or the
national security interest of the United States from the
misuse or diversion of such item.
(C) The effectiveness of controlling the item for national
security purposes of the United States, taking into account
mass-market status, foreign availability, and other relevant
factors.
[[Page S9021]]
(D) The threat to the national security interests of the
United States if the item is not controlled.
(E) Any other appropriate risk factors.
(c) Report on Control List.--Not later than 90 days after
the date of enactment of this Act, the Secretary shall submit
a report to Congress which lists all items on the Commerce
Control List controlled on the day before the date of
enactment of this Act to protect the national security of the
United States, to prevent the proliferation of weapons of
mass destruction and the means to deliver them, and to deter
acts of international terrorism, not included on the National
Security Control List pursuant to the provisions of this Act.
SEC. 203. COUNTRY TIERS.
(a) In General.--
(1) Establishment and assignment.--In administering export
controls for national security purposes under this title, the
President shall, not later than 120 days after the date of
enactment of this Act--
(A) establish and maintain a country tiering system in
accordance with subsection (b); and
(B) based on the assessments required under subsection (c),
assign each country to an appropriate tier for each item or
group of items the export of which is controlled for national
security purposes under this title.
(2) Consultation.--The establishment and assignment of
country tiers under this section shall be made after
consultation with the Secretary, the Secretary of Defense,
the Secretary of State, the intelligence agencies, and such
other departments and agencies as the President considers
appropriate.
(3) Redetermination and review of assignments.--The
President may redetermine the assignment of a country to a
particular tier at any time and shall review and, as the
President considers appropriate, reassign country tiers on an
on-going basis. The Secretary shall provide notice of any
such reassignment to the Committee on Banking, Housing, and
Urban Affairs of the Senate and the Committee on
International Relations of the House of Representatives.
(4) Effective date of tier assignment.-- An assignment of a
country to a particular tier shall take effect on the date on
which notice of the assignment is published in the Federal
Register.
(b) Tiers.--
(1) In general.--The President shall establish a country
tiering system consisting of not less than 3 tiers for
purposes of this section.
(2) Range.--Countries that represent the lowest risk of
diversion or misuse of an item on the National Security
Control List shall be assigned to the lowest tier. Countries
that represent the highest risk of diversion or misuse of an
item on the National Security Control List shall be assigned
to the highest tier.
(3) Other countries.--Countries that fall between the
lowest and highest risk to the national security interest of
the United States with respect to the risk of diversion or
misuse of an item on the National Security Control List shall
be assigned to a tier other than the lowest or highest tier,
based on the assessments required under subsection (c).
(c) Assessments.--The President shall make an assessment of
each country in assigning a country tier taking into
consideration risk factors including the following:
(1) The present and potential relationship of the country
with the United States.
(2) The present and potential relationship of the country
with countries friendly to the United States and with
countries hostile to the United States.
(3) The country's capabilities regarding chemical,
biological, and nuclear weapons and the country's membership
in, and level of compliance with, relevant multilateral
export control regimes.
(4) The country's capabilities regarding missile systems
and the country's membership in, and level of compliance
with, relevant multilateral export control regimes.
(5) Whether the country, if a NATO or major non-NATO ally
with whom the United States has entered into a free trade
agreement as of January 1, 1986, controls exports in
accordance with the criteria and standards of a multilateral
export control regime as defined in section 2(14) pursuant to
an international agreement to which the United States is a
party.
(6) The country's other military capabilities and the
potential threat posed by the country to the United States or
its allies.
(7) The effectiveness of the country's export control
system.
(8) The level of the country's cooperation with United
States export control enforcement and other efforts.
(9) The risk of export diversion by the country to a higher
tier country.
(10) The designation of the country as a country supporting
international terrorism under section 310.
(d) Tier Application.--The country tiering system shall be
used in the determination of license requirements pursuant to
section 201(a)(1).
SEC. 204. INCORPORATED PARTS AND COMPONENTS.
(a) Export of Items Containing Controlled Parts and
Components.--Controls may not be imposed under this title or
any other provision of law on an item solely because the item
contains parts or components subject to export controls under
this title, if the parts or components--
(1) are essential to the functioning of the item,
(2) are customarily included in sales of the item in
countries other than controlled countries, and
(3) comprise 25 percent or less of the total value of the
item,
unless the item itself, if exported, would by virtue of the
functional characteristics of the item as a whole make
a significant contribution to the military or
proliferation potential of a controlled country or end
user which would prove detrimental to the national
security of the United States, or unless failure to
control the item would be contrary to the provisions of
section 201(c), section 201(d), or section 309 of this
Act.
(b) Reexports of Foreign-Made Items Incorporating United
States Controlled Content.--
(1) In general.--No authority or permission may be required
under this title to reexport to a country an item that is
produced in a country other than the United States and
incorporates parts or components that are subject to the
jurisdiction of the United States, if the value of the
controlled United States content of the item produced in such
other country is 25 percent or less of the total value of the
item; except that in the case of reexports of an item to a
country designated as a country supporting international
terrorism pursuant to section 310, controls may be maintained
if the value of the controlled United States content is more
than 10 percent of the total value of the item.
(2) Definition of controlled united states content.--For
purposes of this paragraph, the term ``controlled United
States content'' of an item means those parts or components
that--
(A) are subject to the jurisdiction of the United States;
(B) are incorporated into the item; and
(C) would, at the time of the reexport, require a license
under this title if exported from the United States to a
country to which the item is to be reexported.
SEC. 205. PETITION PROCESS FOR MODIFYING EXPORT STATUS.
(a) Establishment.--The Secretary shall establish a process
for interested persons to petition the Secretary to change
the status of an item on the National Security Control List.
(b) Evaluations and Determinations.--Evaluations and
determinations with respect to a petition filed pursuant to
this section shall be made in accordance with section 202.
Subtitle B--Foreign Availability and Mass-Market Status
SEC. 211. DETERMINATION OF FOREIGN AVAILABILITY AND MASS-
MARKET STATUS.
(a) In General.--The Secretary shall--
(1) on a continuing basis,
(2) upon a request from the Office of Technology
Evaluation, or
(3) upon receipt of a petition filed by an interested
party,
review and determine the foreign availability and the mass-
market status of any item the export of which is controlled
under this title.
(b) Petition and Consultation.--
(1) In general.--The Secretary shall establish a process
for an interested party to petition the Secretary for a
determination that an item has a foreign availability or
mass-market status. In evaluating and making a determination
with respect to a petition filed under this section, the
Secretary shall consult with the Secretary of Defense,
Secretary of State, and other appropriate Government agencies
and with the Office of Technology Evaluation (established
pursuant to section 214).
(2) Time for making determination.--The Secretary shall,
within 6 months after receiving a petition described in
subsection (a)(3), determine whether the item that is the
subject of the petition has foreign availability or mass-
market status and shall notify the petitioner of the
determination.
(c) Result of Determination.--In any case in which the
Secretary determines, in accordance with procedures and
criteria which the Secretary shall by regulation establish,
that an item described in subsection (a) has--
(1) a foreign availability status, or
(2) a mass-market status,
the Secretary shall notify the President (and other
appropriate departments and agencies) and publish the notice
of the determination in the Federal Register. The Secretary's
determination shall become final 30 days after the date the
notice is published, the item shall be removed from the
National Security Control List, and a license or other
authorization shall not be required under this title with
respect to the item, unless the President makes a
determination described in section 212 or 213, or takes
action under section 309, with respect to the item in that
30-day period.
(d) Criteria for Determining Foreign Availability and Mass-
Market Status.--
(1) Foreign availability status.--The Secretary shall
determine that an item has foreign availability status under
this subtitle, if the item (or a substantially identical or
directly competitive item)--
(A) is available to controlled countries from sources
outside the United States, including countries that
participate with the United States in multilateral export
controls;
(B) can be acquired at a price that is not excessive when
compared to the price at which a controlled country could
acquire such item from sources within the United States in
the absence of export controls; and
(C) is available in sufficient quantity so that the
requirement of a license or other authorization with respect
to the export of such item is or would be ineffective.
(2) Mass-market status.--
(A) In general.--In determining whether an item has mass-
market status under this subtitle, the Secretary shall
consider the following criteria with respect to the item (or
a substantially identical or directly competitive item):
(i) The production and availability for sale in a large
volume to multiple potential purchasers.
(ii) The widespread distribution through normal commercial
channels, such as retail stores, direct marketing catalogues,
electronic commerce, and other channels.
(iii) The conduciveness to shipment and delivery by
generally accepted commercial means of transport.
[[Page S9022]]
(iv) The use for the item's normal intended purpose without
substantial and specialized service provided by the
manufacturer, distributor, or other third party.
(B) Determination by secretary.--If the Secretary finds
that the item (or a substantially identical or directly
competitive item) meets the criteria set forth in
subparagraph (A), the Secretary shall determine that the item
has mass-market status.
(3) Special rules.--For purposes of this subtitle--
(A) Substantially identical item.--The determination of
whether an item in relation to another item is a
substantially identical item shall include a fair assessment
of end-uses, the properties, nature, and quality of the item.
(B) Directly competitive item.--
(i) In general.--The determination of whether an item in
relation to another item is a directly competitive item shall
include a fair assessment of whether the item, although not
substantially identical in its intrinsic or inherent
characteristics, is substantially equivalent for commercial
purposes and may be adapted for substantially the same uses.
(ii) Exception.--An item is not directly competitive with a
controlled item if the item is substantially inferior to the
controlled item with respect to characteristics that resulted
in the export of the item being controlled.
SEC. 212. PRESIDENTIAL SET-ASIDE OF FOREIGN AVAILABILITY
STATUS DETERMINATION.
(a) Criteria for Presidential Set-Aside.--
(1) General criteria.--
(A) In general.--If the President determines that--
(i) decontrolling or failing to control an item constitutes
a threat to the national security of the United States, and
export controls on the item would advance the national
security interests of the United States,
(ii) there is a high probability that the foreign
availability of an item will be eliminated through
international negotiations within a reasonable period of time
taking into account the characteristics of the item, or
(iii) United States controls on the item have been imposed
under section 309,
the President may set aside the Secretary's determination of
foreign availability status with respect to the item.
(B) Nondelegation.--The President may not delegate the
authority provided for in this paragraph.
(2) Report to congress.--The President shall promptly--
(A) report any set-aside determination described in
paragraph (1), along with the specific reasons for the
determination, to the Committee on Banking, Housing, and
Urban Affairs of the Senate and the Committee on
International Relations of the House of Representatives; and
(B) publish the determination in the Federal Register.
(b) Presidential Action in Case of Set-Aside.--
(1) In general.--
(A) Negotiations.--In any case in which export controls are
maintained on an item because the President has made a
determination under subsection (a), the President shall
actively pursue negotiations with the governments of the
appropriate foreign countries for the purpose of eliminating
such availability.
(B) Report to congress.--Not later than the date the
President begins negotiations, the President shall notify in
writing the Committee on Banking, Housing, and Urban Affairs
of the Senate and the Committee on International Relations of
the House of Representatives that the President has begun
such negotiations and why the President believes it is
important to the national security that export controls on
the item involved be maintained.
(2) Periodic review of determination.--The President shall
review a determination described in subsection (a) at least
every 6 months. Promptly after each review is completed, the
Secretary shall submit to the committees of Congress referred
to in paragraph (1)(B) a report on the results of the review,
together with the status of international negotiations to
eliminate the foreign availability of the item.
(3) Expiration of presidential set-aside.--A determination
by the President described in subsection (a)(1)(A) (i) or
(ii) shall cease to apply with respect to an item on the
earlier of--
(A) the date that is 6 months after the date on which the
determination is made under subsection (a), if the President
has not commenced international negotiations to eliminate the
foreign availability of the item within that 6-month period;
(B) the date on which the negotiations described in
paragraph (1) have terminated without achieving an agreement
to eliminate foreign availability;
(C) the date on which the President determines that there
is not a high probability of eliminating foreign availability
of the item through negotiation; or
(D) the date that is 18 months after the date on which the
determination described in subsection (a)(1)(A) (i) or (ii)
is made if the President has been unable to achieve an
agreement to eliminate foreign availability within that 18-
month period.
(4) Action on expiration of presidential set-aside.--Upon
the expiration of a Presidential set-aside under paragraph
(3) with respect to an item, the Secretary shall not require
a license or other authorization to export the item.
SEC. 213. PRESIDENTIAL SET-ASIDE OF MASS-MARKET STATUS
DETERMINATION.
(a) Criteria for Presidential Set-Aside.--
(1) General criteria.--If the President determines that--
(A)(i) decontrolling or failing to control an item
constitutes a serious threat to the national security of the
United States, and
(ii) export controls on the item would advance the national
security interests of the United States, or
(B) United States controls on the item have been imposed
under section 309,
the President may set aside the Secretary's determination of
mass-market status with respect to the item.
(2) Nondelegation.--The President may not delegate the
authority provided for in this subsection.
(b) Presidential Action in Case of Set-Aside.--
(1) In general.--In any case in which export controls are
maintained on an item because the President has made a
determination under subsection (a), the President shall
promptly report the determination, along with the specific
reasons for the determination, to the Committee on Banking,
Housing, and Urban Affairs of the Senate and the Committee on
International Relations of the House of Representatives, and
shall publish notice of the determination in the Federal
Register not later than 30 days after the Secretary publishes
notice of the Secretary's determination that an item has
mass-market status.
(2) Periodic review of determination.--The President shall
review a determination made under subsection (a) at least
every 6 months. Promptly after each review is completed, the
Secretary shall submit a report on the results of the review
to the Committee on Banking, Housing, and Urban Affairs of
the Senate and the Committee on International Relations of
the House of Representatives.
SEC. 214. OFFICE OF TECHNOLOGY EVALUATION.
(a) In General.--
(1) Establishment of office.--The Secretary shall establish
in the Department of Commerce an Office of Technology
Evaluation (in this section referred to as the ``Office''),
which shall be under the direction of the Secretary. The
Office shall be responsible for gathering, coordinating, and
analyzing all the necessary information in order for the
Secretary to make determinations of foreign availability and
mass-market status under this Act.
(2) Staff.--
(A) In general.--The Secretary shall ensure that the Office
include persons to carry out the responsibilities set forth
in subsection (b) of this section that have training,
expertise, and experience in--
(i) economic analysis;
(ii) the defense industrial base;
(iii) technological developments; and
(iv) national security and foreign policy export controls.
(B) Detailees.--In addition to employees of the Department
of Commerce, the Secretary may accept on nonreimbursable
detail to the Office, employees of the Departments of
Defense, State, and Energy and other departments and agencies
as appropriate.
(b) Responsibilities.--The Office shall be responsible
for--
(1) conducting foreign availability assessments to
determine whether a controlled item is available to
controlled countries and whether requiring a license, or
denial of a license for the export of such item, is or would
be ineffective;
(2) conducting mass-market assessments to determine whether
a controlled item is available to controlled countries
because of the mass-market status of the item;
(3) monitoring and evaluating worldwide technological
developments in industry sectors critical to the national
security interests of the United States to determine foreign
availability and mass-market status of controlled items;
(4) monitoring and evaluating multilateral export control
regimes and foreign government export control policies and
practices that affect the national security interests of the
United States;
(5) conducting assessments of United States industrial
sectors critical to the United States defense industrial base
and how the sectors are affected by technological
developments, technology transfers, and foreign competition;
and
(6) conducting assessments of the impact of United States
export control policies on--
(A) United States industrial sectors critical to the
national security interests of the United States; and
(B) the United States economy in general.
(c) Reports to Congress.--The Secretary shall make
available to the Committee on International Relations of the
House of Representatives and the Committee on Banking,
Housing, and Urban Affairs of the Senate as part of the
Secretary's annual report required under section 701
information on the operations of the Office, and on
improvements in the Government's ability to assess foreign
availability and mass-market status, during the fiscal year
preceding the report, including information on the training
of personnel, and the use of Commercial Service Officers of
the United States and Foreign Commercial Service to assist in
making determinations. The information shall also include a
description of determinations made under this Act during the
preceding fiscal year that foreign availability or mass-
market status did or did not exist (as the case may be),
together with an explanation of the determinations.
(d) Sharing of Information.--Each department or agency of
the United States, including any intelligence agency, and all
contractors with any such department or agency, shall,
consistent with the need to protect intelligence sources
and methods, furnish information to the Office concerning
foreign availability and the mass-market status of items
subject to export controls under this Act.
TITLE III--FOREIGN POLICY EXPORT CONTROLS
SEC. 301. AUTHORITY FOR FOREIGN POLICY EXPORT CONTROLS.
(a) Authority.--
[[Page S9023]]
(1) In general.--In order to carry out the purposes set
forth in subsection (b), the President may, in accordance
with the provisions of this Act, prohibit, curtail, or
require a license, other authorization, recordkeeping, or
reporting for the export of any item subject to the
jurisdiction of the United States or exported by any person
subject to the jurisdiction of the United States.
(2) Exercise of authority.--The authority contained in this
subsection shall be exercised by the Secretary, in
consultation with the Secretary of State and such other
departments and agencies as the Secretary considers
appropriate.
(b) Purposes.--The purposes of foreign policy export
controls are the following:
(1) To promote the foreign policy objectives of the United
States, consistent with the purposes of this section and the
provisions of this Act.
(2) To promote international peace, stability, and respect
for fundamental human rights.
(3) To use export controls to deter and punish acts of
international terrorism and to encourage other countries to
take immediate steps to prevent the use of their territories
or resources to aid, encourage, or give sanctuary to those
persons involved in directing, supporting, or participating
in acts of international terrorism.
(c) Foreign Products.--No authority or permission may be
required under this title to reexport to a country an item
that is produced in a country other than the United States
and incorporates parts or components that are subject to the
jurisdiction of the United States, except that in the case of
reexports of an item to a country designated as a country
supporting international terrorism pursuant to section 310,
controls may be maintained if the value of the controlled
United States content is more than 10 percent of the value of
the item.
(d) Contract Sanctity.--
(1) In general.--The President may not prohibit the export
of any item under this title if that item is to be exported--
(A) in performance of a binding contract, agreement, or
other contractual commitment entered into before the date on
which the President reports to Congress the President's
intention to impose controls on that item under this title;
or
(B) under a license or other authorization issued under
this Act before the earlier of the date on which the control
is initially imposed or the date on which the President
reports to Congress the President's intention to impose
controls under this title.
(2) Exception.--The prohibition contained in paragraph (1)
shall not apply in any case in which the President determines
and certifies to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on International
Relations of the House of Representatives that--
(A) there is a serious threat to a foreign policy interest
of the United States;
(B) the prohibition of exports under each binding contract,
agreement, commitment, license, or authorization will be
instrumental in remedying the situation posing the serious
threat; and
(C) the export controls will be in effect only as long as
the serious threat exists.
SEC. 302. PROCEDURES FOR IMPOSING CONTROLS.
(a) Notice.--
(1) Intent to impose foreign policy export control.--Except
as provided in section 306, not later than 45 days before
imposing or implementing an export control under this title,
the President shall publish in the Federal Register--
(A) a notice of intent to do so; and
(B) provide for a period of not less than 30 days for any
interested person to submit comments on the export control
proposed under this title.
(2) Purposes of notice.--The purposes of the notice are--
(A) to provide an opportunity for the formulation of an
effective export control policy under this title that
advances United States economic and foreign policy interests;
and
(B) to provide an opportunity for negotiations to achieve
the purposes set forth in section 301(b).
(b) Negotiations.--During the 45-day period that begins on
the date of notice described in subsection (a), the President
may negotiate with the government of the foreign country
against which the export control is proposed in order to
resolve the reasons underlying the proposed export control.
(c) Consultation.--
(1) Requirement.--The President shall consult with the
Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on International Relations of the
House of Representatives regarding any export control
proposed under this title and the efforts to achieve or
increase multilateral cooperation on the issues or problems
underlying the proposed export control.
(2) Classified consultation.--The consultations described
in paragraph (1) may be conducted on a classified basis if
the Secretary considers it necessary.
SEC. 303. CRITERIA FOR FOREIGN POLICY EXPORT CONTROLS.
Each export control imposed by the President under this
title shall--
(1) have clearly stated and specific United States foreign
policy objectives;
(2) have objective standards for evaluating the success or
failure of the export control;
(3) include an assessment by the President that--
(A) the export control is likely to achieve such objectives
and the expected time for achieving the objectives; and
(B) the achievement of the objectives of the export control
outweighs any potential costs of the export control to other
United States economic, foreign policy, humanitarian, or
national security interests;
(4) be targeted narrowly; and
(5) seek to minimize any adverse impact on the humanitarian
activities of United States and foreign nongovernmental
organizations in the country subject to the export control.
SEC. 304. PRESIDENTIAL REPORT BEFORE IMPOSITION OF CONTROL.
(a) Requirement.--Before imposing an export control under
this title, the President shall submit to the Committee on
Banking, Housing, and Urban Affairs of the Senate and the
Committee on International Relations of the House of
Representatives a report on the proposed export control. The
report may be provided on a classified basis if the Secretary
considers it necessary.
(b) Content.--The report shall contain a description and
assessment of each of the criteria described in section 303.
In addition, the report shall contain a description and
assessment of--
(1) any diplomatic and other steps that the United States
has taken to accomplish the intended objective of the
proposed export control;
(2) unilateral export controls imposed, and other measures
taken, by other countries to achieve the intended objective
of the proposed export control;
(3) the likelihood of multilateral adoption of comparable
export controls;
(4) alternative measures to promote the same objectives and
the likelihood of their potential success;
(5) any United States obligations under international trade
agreements, treaties, or other international arrangements,
with which the proposed export control may conflict;
(6) the likelihood that the proposed export control could
lead to retaliation against United States interests;
(7) the likely economic impact of the proposed export
control on the United States economy, United States
international trade and investment, and United States
agricultural interests, commercial interests, and employment;
and
(8) a conclusion that the probable achievement of the
objectives of the proposed export control outweighs any
likely costs to United States economic, foreign policy,
humanitarian, or national security interests, including any
potential harm to the United States agricultural and business
firms and to the international reputation of the United
States as a reliable supplier of goods, services, or
technology.
SEC. 305. IMPOSITION OF CONTROLS.
The President may impose an export control under this title
after the submission of the report required under section 304
and publication in the Federal Register of a notice of the
imposition of the export control .
SEC. 306. DEFERRAL AUTHORITY.
(a) Authority.--The President may defer compliance with any
requirement contained in section 302(a), 304, or 305 in the
case of a proposed export control if--
(1) the President determines that a deferral of compliance
with the requirement is in the national interest of the
United States; and
(2) the requirement is satisfied not later than 60 days
after the date on which the export control is imposed under
this title.
(b) Termination of Control.--An export control with respect
to which a deferral has been made under subsection (a) shall
terminate 60 days after the date the export control is
imposed unless all requirements have been satisfied before
the expiration of the 60-day period.
SEC. 307. REVIEW, RENEWAL, AND TERMINATION.
(a) Renewal and Termination.--
(1) In general.--Any export control imposed under this
title shall terminate on March 31 of each renewal year unless
the President renews the export control on or before such
date. For purposes of this section, the term ``renewal year''
means 2003 and every 2 years thereafter.
(2) Exception.--This section shall not apply to an export
control imposed under this title that--
(A) is required by law;
(B) is targeted against any country designated as a country
supporting international terrorism pursuant to section 310;
or
(C) has been in effect for less than 1 year as of February
1 of a renewal year.
(b) Review.--
(1) In general.--Not later than February 1 of each renewal
year, the President shall review all export controls in
effect under this title.
(2) Consultation.--
(A) Requirement.--Before completing a review under
paragraph (1), the President shall consult with the Committee
on Banking, Housing, and Urban Affairs of the Senate and the
Committee on International Relations of the House of
Representative regarding each export control that is being
reviewed.
(B) Classified consultation.--The consultations may be
conducted on a classified basis if the Secretary considers it
necessary.
(3) Public comment.--In conducting the review of each
export control under paragraph (1), the President shall
provide a period of not less than 30 days for any interested
person to submit comments on renewal of the export control.
The President shall publish notice of the opportunity for
public comment in the Federal Register not less than 45 days
before the review is required to be completed.
(c) Report to Congress.--
(1) Requirement.--Before renewing an export control imposed
under this title, the President shall submit to the
committees of Congress referred to in subsection (b)(2)(A) a
report on each export control that the President intends to
renew.
(2) Form and content of report.--The report may be provided
on a classified basis if the Secretary considers it
necessary. Each report shall contain the following:
(A) A clearly stated explanation of the specific United
States foreign policy objective that the existing export
control was intended to achieve.
[[Page S9024]]
(B) An assessment of--
(i) the extent to which the existing export control
achieved its objectives before renewal based on the objective
criteria established for evaluating the export control; and
(ii) the reasons why the existing export control has failed
to fully achieve its objectives and, if renewed, how the
export control will achieve that objective before the next
renewal year.
(C) An updated description and assessment of--
(i) each of the criteria described in section 303, and
(ii) each matter required to be reported under section
304(b) (1) through (8).
(3) Renewal of export control.--The President may renew an
export control under this title after submission of the
report described in paragraph (2) and publication of notice
of renewal in the Federal Register.
SEC. 308. TERMINATION OF CONTROLS UNDER THIS TITLE.
(a) In General.--Notwithstanding any other provision of
law, the President--
(1) shall terminate any export control imposed under this
title if the President determines that the control has
substantially achieved the objective for which it was
imposed; and
(2) may terminate at any time any export control imposed
under this title that is not required by law.
(b) Exception.--Paragraphs (1) and (2) of subsection (a) do
not apply to any export control imposed pursuant to section
310.
(c) Effective Date of Termination.--The termination of an
export control pursuant to this section shall take effect on
the date notice of the termination is published in the
Federal Register.
SEC. 309. COMPLIANCE WITH INTERNATIONAL OBLIGATIONS.
Notwithstanding any other provision of this Act setting
forth limitations on authority to control exports and except
as provided in section 304, the President may impose controls
on exports to a particular country or countries--
(1) of items listed on the control list of a multilateral
export control regime, as defined in section 2(14); or
(2) in order to fulfill obligations or commitments of the
United States under resolutions of the United Nations and
under treaties, or other international agreements and
arrangements, to which the United States is a party.
SEC. 310. DESIGNATION OF COUNTRIES SUPPORTING INTERNATIONAL
TERRORISM.
(a) License Required.--Notwithstanding any other provision
of this Act setting forth limitations on the authority to
control exports, a license shall be required for the export
of any item to a country if the Secretary of State has
determined that--
(1) the government of such country has repeatedly provided
support for acts of international terrorism; and
(2) the export of the item could make a significant
contribution to the military potential of such country,
including its military logistics capability, or could enhance
the ability of such country to support acts of international
terrorism.
(b) Notification.--The Secretary and the Secretary of State
shall notify the Committee on International Relations of the
House of Representatives and the Committee on Banking,
Housing, and Urban Affairs and the Committee on Foreign
Relations of the Senate at least 30 days before issuing any
license required by subsection (a).
(c) Determinations Regarding Repeated Support.--Each
determination of the Secretary of State under subsection
(a)(1), including each determination in effect on the date of
the enactment of the Antiterrorism and Arms Export
Amendments Act of 1989, shall be published in the Federal
Register.
(d) Limitations on Rescinding Determination.--A
determination made by the Secretary of State under subsection
(a)(1) may not be rescinded unless the President submits to
the Speaker of the House of Representatives and the Chairman
of the Committee on Banking, Housing, and Urban Affairs and
the Chairman of the Committee on Foreign Relations of the
Senate--
(1) before the proposed rescission would take effect, a
report certifying that--
(A) there has been a fundamental change in the leadership
and policies of the government of the country concerned;
(B) that government is not supporting acts of international
terrorism; and
(C) that government has provided assurances that it will
not support acts of international terrorism in the future; or
(2) at least 45 days before the proposed rescission would
take effect, a report justifying the rescission and
certifying that--
(A) the government concerned has not provided any support
for international terrorism during the preceding 6-month
period; and
(B) the government concerned has provided assurances that
it will not support acts of international terrorism in the
future.
(e) Information To Be Included in Notification.--The
Secretary and the Secretary of State shall include in the
notification required by subsection (b)--
(1) a detailed description of the item to be offered,
including a brief description of the capabilities of any item
for which a license to export is sought;
(2) the reasons why the foreign country or international
organization to which the export or transfer is proposed to
be made needs the item which is the subject of such export or
transfer and a description of the manner in which such
country or organization intends to use the item;
(3) the reasons why the proposed export or transfer is in
the national interest of the United States;
(4) an analysis of the impact of the proposed export or
transfer on the military capabilities of the foreign country
or international organization to which such export or
transfer would be made;
(5) an analysis of the manner in which the proposed export
would affect the relative military strengths of countries in
the region to which the item which is the subject of such
export would be delivered and whether other countries in the
region have comparable kinds and amounts of the item; and
(6) an analysis of the impact of the proposed export or
transfer on the United States relations with the countries in
the region to which the item which is the subject of such
export would be delivered.
SEC. 311. CRIME CONTROL INSTRUMENTS.
(a) In General.--Crime control and detection instruments
and equipment shall be approved for export by the Secretary
only pursuant to an individual export license.
Notwithstanding any other provision of this Act--
(1) any determination by the Secretary of what goods or
technology shall be included on the list established pursuant
to this subsection as a result of the export restrictions
imposed by this section shall be made with the concurrence of
the Secretary of State, and
(2) any determination by the Secretary to approve or deny
an export license application to export crime control or
detection instruments or equipment shall be made in
concurrence with the recommendations of the Secretary of
State submitted to the Secretary with respect to the
application pursuant to section 401 of this Act,
except that, if the Secretary does not agree with the
Secretary of State with respect to any determination under
paragraph (1) or (2), the matter shall be referred to the
President for resolution.
(b) Exception.--The provisions of this section shall not
apply with respect to exports to countries that are members
of the North Atlantic Treaty Organization or to Japan,
Australia, or New Zealand, or to such other countries as the
President shall designate consistent with the purposes of
this section and section 502B of the Foreign Assistance Act
of 1961 (22 U.S.C. 2304).
TITLE IV--PROCEDURES FOR EXPORT LICENSES AND INTERAGENCY DISPUTE
RESOLUTION
SEC. 401. EXPORT LICENSE PROCEDURES.
(a) Responsibility of the Secretary.--
(1) In general.--All applications for a license or other
authorization to export a controlled item shall be filed in
such manner and include such information as the Secretary
may, by regulation, prescribe.
(2) Procedures.--In guidance and regulations that implement
this section, the Secretary shall describe the procedures
required by this section, the responsibilities of the
Secretary and of other departments and agencies in reviewing
applications, the rights of the applicant, and other relevant
matters affecting the review of license applications.
(3) Calculation of processing times.--In calculating the
processing times set forth in this title, the Secretary shall
use calendar days, except that if the final day for a
required action falls on a weekend or holiday, that action
shall be taken no later than the following business day.
(4) Criteria for evaluating applications.--In determining
whether to grant an application to export a controlled item
under this Act, the following criteria shall be considered:
(A) The characteristics of the controlled item.
(B) The threat to--
(i) the national security interests of the United States
from items controlled under title II of this Act; or
(ii) the foreign policy of the United States from items
controlled under title III of this Act.
(C) The country tier designation of the country to which a
controlled item is to be exported pursuant to section 203.
(D) The risk of export diversion or misuse by--
(i) the exporter;
(ii) the method of export;
(iii) the end-user;
(iv) the country where the end-user is located; and
(v) the end-use.
(E) Risk mitigating factors including, but not limited to--
(i) changing the characteristics of the controlled item;
(ii) after-market monitoring by the exporter; and
(iii) post-shipment verification.
(b) Initial Screening.--
(1) Upon receipt of application.--Upon receipt of an export
license application, the Secretary shall enter and maintain
in the records of the Department information regarding the
receipt and status of the application.
(2) Initial procedures.--
(A) In general.--Not later than 9 days after receiving any
license application, the Secretary shall--
(i) contact the applicant if the application is improperly
completed or if additional information is required, and hold
the application for a reasonable time while the applicant
provides the necessary corrections or information, and such
time shall not be included in calculating the time periods
prescribed in this title;
(ii) refer the application, through the use of a common
data base or other means, and all information submitted by
the applicant, and all necessary recommendations and analyses
by the Secretary to the Secretary of Defense, the Secretary
of State, and the heads of and other departments and agencies
the Secretary considers appropriate;
(iii) ensure that the classification stated on the
application for the export items is correct; and
(iv) return the application if a license is not required.
[[Page S9025]]
(B) Referral not required.--In the event that the head of a
department or agency determines that certain types of
applications need not be referred to the department or
agency, such department or agency head shall notify the
Secretary of the specific types of such applications that the
department or agency does not wish to review.
(3) Withdrawal of application.--An applicant may, by
written notice to the Secretary, withdraw an application at
any time before final action.
(c) Action by Other Departments and Agencies.--
(1) Referral to other agencies.--The Secretary shall
promptly refer a license application to the departments and
agencies under subsection (b) to make recommendations and
provide information to the Secretary.
(2) Responsibility of referral departments and agencies.--
The Secretary of Defense, the Secretary of State, and the
heads of other reviewing departments and agencies shall take
all necessary actions in a prompt and responsible manner on
an application. Each department or agency reviewing an
application under this section shall establish and maintain
records properly identifying and monitoring the status of the
matter referred to the department or agency.
(3) Additional information requests.--Each department or
agency to which a license application is referred shall
specify to the Secretary any information that is not in the
application that would be required for the department or
agency to make a determination with respect to the
application, and the Secretary shall promptly request such
information from the applicant. The time that may elapse
between the date the information is requested by that
department or agency and the date the information is received
by that department or agency shall not be included in
calculating the time periods prescribed in this title.
(4) Time period for action by referral departments and
agencies.--Within 30 days after the Secretary refers an
application under this section, each department or agency to
which an application has been referred shall provide the
Secretary with a recommendation either to approve the license
or to deny the license. A recommendation that the Secretary
deny a license shall include a statement of reasons for the
recommendation that are consistent with the provisions of
this title, and shall cite both the specific statutory and
regulatory basis for the recommendation. A department or
agency that fails to provide a recommendation in accordance
with this paragraph within that 30-day period shall be deemed
to have no objection to the decision of the Secretary on the
application.
(d) Action by the Secretary.--Not later than 30 days after
the date the application is referred, the Secretary shall--
(1) if there is agreement among the referral departments
and agencies to issue or deny the license--
(A) issue the license and ensure all appropriate personnel
in the Department (including the Office of Export
Enforcement) are notified of all approved license
applications; or
(B) notify the applicant of the intention to deny the
license; or
(2) if there is no agreement among the referral departments
and agencies, notify the applicant that the application is
subject to the interagency dispute resolution process
provided for in section 402.
(e) Consequences of Application Denial.--
(1) In general.--If a determination is made to deny a
license, the applicant shall be informed in writing,
consistent with the protection of intelligence information
sources and methods, by the Secretary of--
(A) the determination;
(B) the specific statutory and regulatory bases for the
proposed denial;
(C) what, if any, modifications to, or restrictions on, the
items for which the license was sought would allow such
export to be compatible with export controls imposed under
this Act, and which officer or employee of the Department
would be in a position to discuss modifications or
restrictions with the applicant and the specific statutory
and regulatory bases for imposing such modifications or
restrictions;
(D) to the extent consistent with the national security and
foreign policy interests of the United States, the specific
considerations that led to the determination to deny the
application; and
(E) the availability of appeal procedures.
(2) Period for applicant to respond.--The applicant shall
have 20 days from the date of the notice of intent to deny
the application to respond in a manner that addresses and
corrects the reasons for the denial. If the applicant does
not adequately address or correct the reasons for denial or
does not respond, the license shall be denied. If the
applicant does address or correct the reasons for denial, the
application shall be considered in a timely manner.
(f) Appeals and Other Actions by Applicant.--
(1) In general.--The Secretary shall establish appropriate
procedures for an applicant to appeal to the Secretary the
denial of an application or other administrative action under
this Act. In any case in which the Secretary proposes to
reverse the decision with respect to the application, the
appeal under this subsection shall be handled in accordance
with the interagency dispute resolution process provided for
in section 402(b)(3).
(2) Enforcement of time limits.--
(A) In general.--In any case in which an action prescribed
in this section is not taken on an application within the
time period established by this section (except in the case
of a time period extended under subsection (g) of which the
applicant is notified), the applicant may file a petition
with the Secretary requesting compliance with the
requirements of this section. When such petition is filed,
the Secretary shall take immediate steps to correct the
situation giving rise to the petition and shall immediately
notify the applicant of such steps.
(B) Bringing court action.--If, within 20 days after a
petition is filed under subparagraph (A), the processing of
the application has not been brought into conformity with the
requirements of this section, or the processing of the
application has been brought into conformity with such
requirements but the Secretary has not so notified the
applicant, the applicant may bring an action in an
appropriate United States district court for an order
requiring compliance with the time periods required by this
section.
(g) Exceptions From Required Time Periods.--The following
actions related to processing an application shall not be
included in calculating the time periods prescribed in this
section:
(1) Agreement of the applicant.--Delays upon which the
Secretary and the applicant mutually agree.
(2) Prelicense checks.--A prelicense check (for a period
not to exceed 60 days) that may be required to establish the
identity and reliability of the recipient of items controlled
under this Act, if--
(A) the need for the prelicense check is determined by the
Secretary or by another department or agency in any case in
which the request for the prelicense check is made by such
department or agency;
(B) the request for the prelicense check is initiated by
the Secretary within 5 days after the determination that the
prelicense check is required; and
(C) the analysis of the result of the prelicense check is
completed by the Secretary within 5 days.
(3) Requests for government-to-government assurances.--Any
request by the Secretary or another department or agency for
government-to-government assurances of suitable end-uses of
items approved for export, when failure to obtain such
assurances would result in rejection of the application, if--
(A) the request for such assurances is sent to the
Secretary of State within 5 days after the determination that
the assurances are required;
(B) the Secretary of State initiates the request of the
relevant government within 10 days thereafter; and
(C) the license is issued within 5 days after the Secretary
receives the requested assurances.
(4) Exception.--Whenever a prelicense check described in
paragraph (2) or assurances described in paragraph (3) are
not requested within the time periods set forth therein, then
the time expended for such prelicense check or assurances
shall be included in calculating the time periods established
by this section.
(5) Multilateral review.--Multilateral review of a license
application to the extent that such multilateral review is
required by a relevant multilateral regime.
(6) Congressional notification.--Such time as is required
for mandatory congressional notifications under this Act.
(7) Consultations.--Consultation with foreign governments,
if such consultation is provided for by a relevant
multilateral regime as a precondition for approving a
license.
(h) Classification Requests and Other Inquiries.--
(1) Classification requests.--In any case in which the
Secretary receives a written request asking for the proper
classification of an item on the Control List or the
applicability of licensing requirements under this title, the
Secretary shall promptly notify the Secretary of Defense and
the head of any department or agency the Secretary considers
appropriate. The Secretary shall, within 14 days after
receiving the request, inform the person making the
request of the proper classification.
(2) Other inquiries.--In any case in which the Secretary
receives a written request for information under this Act,
the Secretary shall, within 30 days after receiving the
request, reply with that information to the person making the
request.
SEC. 402. INTERAGENCY DISPUTE RESOLUTION PROCESS.
(a) In General.--All license applications on which
agreement cannot be reached shall be referred to the
interagency dispute resolution process for decision.
(b) Interagency Dispute Resolution Process.--
(1) Initial resolution.--The Secretary shall establish,
select the chairperson of, and determine procedures for an
interagency committee to review initially all license
applications described in subsection (a) with respect to
which the Secretary and any of the referral departments and
agencies are not in agreement. The chairperson shall consider
the positions of all the referral departments and agencies
(which shall be included in the minutes described in
subsection (c)(2)) and make a decision on the license
application, including appropriate revisions or conditions
thereto.
(2) Intelligence community.--The analytic product of the
intelligence community should be fully considered with
respect to any proposed license under this title.
(3) Further resolution.--The President shall establish
additional levels for review or appeal of any matter that
cannot be resolved pursuant to the process described in
paragraph (1). Each such review shall--
(A) provide for decision-making based on the majority vote
of the participating departments and agencies;
(B) provide that a department or agency that fails to take
a timely position, citing the specific statutory and
regulatory bases for a position, shall be deemed to have no
objection to the pending decision;
(C) provide that any decision of an interagency committee
established under paragraph
[[Page S9026]]
(1) or interagency dispute resolution process established
under this paragraph may be escalated to the next higher
level of review at the request of an official appointed by
the President, by and with the advice of the Senate, or an
officer properly acting in such capacity, of a department or
agency that participated in the interagency committee or
dispute resolution process that made the decision; and
(D) ensure that matters are resolved or referred to the
President not later than 90 days after the date the completed
license application is referred by the Secretary.
(c) Final Action.--
(1) In general.--Once a final decision is made under
subsection (b), the Secretary shall promptly--
(A) issue the license and ensure that all appropriate
personnel in the Department (including the Office of Export
Enforcement) are notified of all approved license
applications; or
(B) notify the applicant of the intention to deny the
application.
(2) Minutes.--The interagency committee and each level of
the interagency dispute resolution process shall keep
reasonably detailed minutes of all meetings. On each matter
before the interagency committee or before any other level of
the interagency dispute resolution process in which members
disagree, each member shall clearly state the reasons for the
member's position and the reasons shall be entered in the
minutes.
TITLE V--INTERNATIONAL ARRANGEMENTS; FOREIGN BOYCOTTS; SANCTIONS; AND
ENFORCEMENT
SEC. 501. INTERNATIONAL ARRANGEMENTS.
(a) Multilateral Export Control Regimes.--
(1) Policy.--It is the policy of the United States to seek
multilateral arrangements that support the national security
objectives of the United States (as described in title II)
and that establish fairer and more predictable competitive
opportunities for United States exporters.
(2) Participation in existing regimes.--Congress encourages
the United States to continue its active participation in and
to strengthen existing multilateral export control regimes.
(3) Participation in new regimes.--It is the policy of the
United States to participate in additional multilateral
export control regimes if such participation would serve the
national security interests of the United States.
(b) Annual Report on Multilateral Export Control Regimes.--
Not later than February 1 of each year, the President shall
submit to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on International
Relations of the House of Representatives a report evaluating
the effectiveness of each multilateral export control regime,
including an assessment of the steps undertaken pursuant to
subsections (c) and (d). The report, or any part of this
report, may be submitted in classified form to the extent the
President considers necessary.
(c) Standards for Multilateral Export Control Regimes.--The
President shall take steps to establish the following
features in any multilateral export control regime in which
the United States is participating or may participate:
(1) Full membership.--All supplier countries are members of
the regime, and the policies and activities of the members
are consistent with the objectives and membership criteria of
the multilateral export control regime.
(2) Effective enforcement and compliance.--The regime
promotes enforcement and compliance with the regime's rules
and guidelines.
(3) Public understanding.--The regime makes an effort to
enhance public understanding of the purpose and procedures of
the multilateral export control regime.
(4) Effective implementation procedures.--The multilateral
export control regime has procedures for the uniform and
consistent interpretation and implementation of its rules and
guidelines.
(5) Enhanced cooperation with regime nonmembers.--There is
agreement among the members of the multilateral export
control regime to--
(A) cooperate with governments outside the regime to
restrict the export of items controlled by such regime; and
(B) establish an ongoing mechanism in the regime to
coordinate planning and implementation of export control
measures related to such cooperation.
(6) Periodic high-level meetings.--There are regular
periodic meetings of high-level representatives of the
governments of members of the multilateral export control
regime for the purpose of coordinating export control
policies and issuing policy guidance to members of the
regime.
(7) Common list of controlled items.--There is agreement on
a common list of items controlled by the multilateral export
control regime.
(8) Regular updates of common list.--There is a procedure
for removing items from the list of controlled items when the
control of such items no longer serves the objectives of the
members of the multilateral export control regime.
(9) Treatment of certain countries.--There is agreement to
prevent the export or diversion of the most sensitive items
to countries whose activities are threatening to the national
security of the United States or its allies.
(10) Harmonization of license approval procedures.--There
is harmonization among the members of the regime of their
national export license approval procedures, practices, and
standards.
(11) Undercutting.--There is a limit with respect to when
members of a multilateral export control regime--
(A) grant export licenses for any item that is
substantially identical to or directly competitive with an
item controlled pursuant to the regime, where the United
States has denied an export license for such item, or
(B) approve exports to a particular end user to which the
United States has denied export license for a similar item.
(d) Standards for National Export Control Systems.--The
President shall take steps to attain the cooperation of
members of each regime in implementing effective national
export control systems containing the following features:
(1) Export control law.--Enforcement authority, civil and
criminal penalties, and statutes of limitations are
sufficient to deter potential violations and punish violators
under the member's export control law.
(2) License approval process.--The system for evaluating
export license applications includes sufficient technical
expertise to assess the licensing status of exports and
ensure the reliability of end users.
(3) Enforcement.--The enforcement mechanism provides
authority for trained enforcement officers to investigate and
prevent illegal exports.
(4) Documentation.--There is a system of export control
documentation and verification with respect to controlled
items.
(5) Information.--There are procedures for the coordination
and exchange of information concerning licensing, end users,
and enforcement with other members of the multilateral export
control regime.
(6) Resources.--The member has devoted adequate resources
to administer effectively the authorities, systems,
mechanisms, and procedures described in paragraphs (1)
through (5).
(e) Objectives Regarding Multilateral Export Control
Regimes.--The President shall seek to achieve the following
objectives with regard to multilateral export control
regimes:
(1) Strengthen existing regimes.--Strengthen existing
multilateral export control regimes--
(A) by creating a requirement to share information about
export license applications among members before a member
approves an export license; and
(B) harmonizing national export license approval procedures
and practices, including the elimination of undercutting.
(2) Review and update.--Review and update multilateral
regime export control lists with other members, taking into
account--
(A) national security concerns;
(B) the controllability of items; and
(C) the costs and benefits of controls.
(3) Encourage compliance by nonmembers.--Encourage
nonmembers of the multilateral export control regime--
(A) to strengthen their national export control regimes and
improve enforcement;
(B) to adhere to the appropriate multilateral export
control regime; and
(C) not to undermine an existing multilateral export
control regime by exporting controlled items in a manner
inconsistent with the guidelines of the regime.
(f) Transparency of Multilateral Export Control Regimes.--
(1) Publication of information on each existing regime.--
Not later than 120 days after the date of enactment of this
Act, the Secretary shall, for each multilateral export
control regime, to the extent that it is not inconsistent
with the arrangements of that regime (in the judgment of the
Secretary of State) or with the national interest, publish in
the Federal Register and post on the Department of Commerce
website the following information with respect to the regime:
(A) The purposes of the regime.
(B) The members of the regime.
(C) The export licensing policy of the regime.
(D) The items that are subject to export controls under the
regime, together with all public notes, understandings, and
other aspects of the agreement of the regime, and all changes
thereto.
(E) Any countries, end uses, or end users that are subject
to the export controls of the regime.
(F) Rules of interpretation.
(G) Major policy actions.
(H) The rules and procedures of the regime for establishing
and modifying any matter described in subparagraphs (A)
through (G) and for reviewing export license applications.
(2) New regimes.--Not later than 60 days after the United
States joins or organizes a new multilateral export control
regime, the Secretary shall, to the extent that it is not
inconsistent with arrangements under the regime (in the
judgment of the Secretary of State) or with the national
interest, publish in the Federal Register and post on the
Department of Commerce website the information described in
subparagraphs (A) through (H) of paragraph (1) with respect
to the regime.
(3) Publication of changes.--Not later than 60 days after a
multilateral export control regime adopts any change in the
information published under this subsection, the Secretary
shall, to the extent not inconsistent with the arrangements
under the regime or the national interest, publish such
changes in the Federal Register and post such changes on the
Department of Commerce website.
(g) Support of Other Countries' Export Control Systems.--
The Secretary is encouraged to continue to--
(1) participate in training of, and provide training to,
officials of other countries on the principles and procedures
for implementing effective export controls; and
(2) participate in any such training provided by other
departments and agencies of the United States.
SEC. 502. FOREIGN BOYCOTTS.
(a) Purposes.--The purposes of this section are as follows:
(1) To counteract restrictive trade practices or boycotts
fostered or imposed by foreign countries
[[Page S9027]]
against other countries friendly to the United States or
against any United States person.
(2) To encourage and, in specified cases, require United
States persons engaged in the export of items to refuse to
take actions, including furnishing information or entering
into or implementing agreements, which have the effect of
furthering or supporting the restrictive trade practices or
boycotts fostered or imposed by any foreign country against a
country friendly to the United States or against any United
States person.
(b) Prohibitions and Exceptions.--
(1) Prohibitions.--In order to carry out the purposes set
forth in subsection (a), the President shall issue
regulations prohibiting any United States person, with
respect to that person's activities in the interstate or
foreign commerce of the United States, from taking or
knowingly agreeing to take any of the following actions with
intent to comply with, further, or support any boycott
fostered or imposed by a foreign country against a country
that is friendly to the United States and is not itself the
object of any form of boycott pursuant to United States
law or regulation:
(A) Refusing, or requiring any other person to refuse, to
do business with or in the boycotted country, with any
business concern organized under the laws of the boycotted
country, with any national or resident of the boycotted
country, or with any other person, pursuant to an agreement
with, or requirement of, or a request from or on behalf of
the boycotting country (subject to the condition that the
intent required to be associated with such an act in order to
constitute a violation of the prohibition is not indicated
solely by the mere absence of a business relationship with or
in the boycotted country, with any business concern organized
under the laws of the boycotted country, with any national or
resident of the boycotted country, or with any other person).
(B) Refusing, or requiring any other person to refuse, to
employ or otherwise discriminate against any United States
person on the basis of the race, religion, sex, or national
origin of that person or of any owner, officer, director, or
employee of such person.
(C) Furnishing information with respect to the race,
religion, sex, or national origin of any United States person
or of any owner, officer, director, or employee of such
person.
(D) Furnishing information (other than furnishing normal
business information in a commercial context, as defined by
the Secretary) about whether any person has, has had, or
proposes to have any business relationship (including a
relationship by way of sale, purchase, legal or commercial
representation, shipping or other transport, insurance,
investment, or supply) with or in the boycotted country, with
any business concern organized under the laws of the
boycotted country, with any national or resident of the
boycotted country, or with any other person that is known or
believed to be restricted from having any business
relationship with or in the boycotting country.
(E) Furnishing information about whether any person is a
member of, has made a contribution to, or is otherwise
associated with or involved in the activities of any
charitable or fraternal organization which supports the
boycotted country.
(F) Paying, honoring, confirming, or otherwise implementing
a letter of credit which contains any condition or
requirement the compliance with which is prohibited by
regulations issued pursuant to this paragraph, and no United
States person shall, as a result of the application of this
paragraph, be obligated to pay or otherwise honor or
implement such letter of credit.
(2) Exceptions.--Regulations issued pursuant to paragraph
(1) shall provide exceptions for--
(A) compliance, or agreement to comply, with requirements--
(i) prohibiting the import of items from the boycotted
country or items produced or provided, by any business
concern organized under the laws of the boycotted country or
by nationals or residents of the boycotted country; or
(ii) prohibiting the shipment of items to the boycotting
country on a carrier of the boycotted country or by a route
other than that prescribed by the boycotting country or the
recipient of the shipment;
(B) compliance, or agreement to comply, with import and
shipping document requirements with respect to the country of
origin, the name of the carrier and route of shipment, the
name of the supplier of the shipment, or the name of the
provider of other services, except that, for purposes of
applying any exception under this subparagraph, no
information knowingly furnished or conveyed in response to
such requirements may be stated in negative, blacklisting, or
similar exclusionary terms, other than with respect to
carriers or route of shipment as may be permitted by such
regulations in order to comply with precautionary
requirements protecting against war risks and confiscation;
(C) compliance, or agreement to comply, in the normal
course of business with the unilateral and specific selection
by a boycotting country, or a national or resident thereof,
or carriers, insurers, suppliers of services to be performed
within the boycotting country, or specific items which, in
the normal course of business, are identifiable by source
when imported into the boycotting country;
(D) compliance, or agreement to comply, with export
requirements of the boycotting country relating to shipment
or transshipment of exports to the boycotted country, to any
business concern of or organized under the laws of the
boycotted country, or to any national or resident of the
boycotted country;
(E) compliance by an individual, or agreement by an
individual to comply, with the immigration or passport
requirements of any country with respect to such individual
or any member of such individual's family or with requests
for information regarding requirements of employment of such
individual within the boycotting country; and
(F) compliance by a United States person resident in a
foreign country, or agreement by such a person to comply,
with the laws of the country with respect to the person's
activities exclusively therein, and such regulations may
contain exceptions for such resident complying with the laws
or regulations of the foreign country governing imports into
such country of trademarked, trade-named, or similarly
specifically identifiable products, or components of
products for such person's own use, including the
performance of contractual services within that country.
(3) Limitation on exceptions.--Regulations issued pursuant
to paragraphs (2)(C) and (2)(F) shall not provide exceptions
from paragraphs (1)(B) and (1)(C).
(4) Antitrust and civil rights laws not affected.--Nothing
in this subsection may be construed to supersede or limit the
operation of the antitrust or civil rights laws of the United
States.
(5) Evasion.--This section applies to any transaction or
activity undertaken by or through a United States person or
any other person with intent to evade the provisions of this
section or the regulations issued pursuant to this
subsection. The regulations issued pursuant to this section
shall expressly provide that the exceptions set forth in
paragraph (2) do not permit activities or agreements
(expressed or implied by a course of conduct, including a
pattern of responses) that are otherwise prohibited, pursuant
to the intent of such exceptions.
(c) Additional Regulations and Reports.--
(1) Regulations.--In addition to the regulations issued
pursuant to subsection (b), regulations issued pursuant to
title III shall implement the purposes set forth in
subsection (a).
(2) Reports by united states persons.--The regulations
shall require that any United States person receiving a
request to furnish information, enter into or implement an
agreement, or take any other action referred to in
subsection (a) shall report that request to the Secretary,
together with any other information concerning the request
that the Secretary determines appropriate. The person
shall also submit to the Secretary a statement regarding
whether the person intends to comply, and whether the
person has complied, with the request. Any report filed
pursuant to this paragraph shall be made available
promptly for public inspection and copying, except that
information regarding the quantity, description, and value
of any item to which such report relates may be treated as
confidential if the Secretary determines that disclosure
of that information would place the United States person
involved at a competitive disadvantage. The Secretary
shall periodically transmit summaries of the information
contained in the reports to the Secretary of State for
such action as the Secretary of State, in consultation
with the Secretary, considers appropriate to carry out the
purposes set forth in subsection (a).
(d) Preemption.--The provisions of this section and the
regulations issued under this section shall preempt any law,
rule, or regulation that--
(1) is a law, rule, or regulation of any of the several
States or the District of Columbia, or any of the territories
or possessions of the United States, or of any governmental
subdivision thereof; and
(2) pertains to participation in, compliance with,
implementation of, or the furnishing of information regarding
restrictive trade practices or boycotts fostered or imposed
by foreign countries against other countries.
SEC. 503. PENALTIES.
(a) Criminal Penalties.--
(1) Violations by an individual.--Any individual who
willfully violates, conspires to violate, or attempts to
violate any provision of this Act or any regulation, license,
or order issued under this Act shall be fined up to 10 times
the value of the exports involved or $1,000,000, whichever is
greater, imprisoned for not more than 10 years, or both, for
each violation.
(2) Violations by a person other than an individual.--Any
person other than an individual who willfully violates,
conspires to violate, or attempts to violate any provision of
this Act or any regulation, license, or order issued under
this Act shall be fined up to 10 times the value of the
exports involved or $5,000,000, whichever is greater, for
each violation.
(b) Forfeiture of Property Interest and Proceeds.--
(1) Forfeiture.--Any person who is convicted under
paragraph (1) or (2) of subsection (a) shall, in addition to
any other penalty, forfeit to the United States--
(A) any of that person's security or other interest in,
claim against, or property or contractual rights of any kind
in the tangible items that were the subject of the violation;
(B) any of that person's security or other interest in,
claim against, or property or contractual rights of any kind
in the tangible property that was used in the export or
attempt to export that was the subject of the violation; and
(C) any of that person's property constituting, or derived
from, any proceeds obtained directly or indirectly as a
result of the violation.
(2) Procedures.--The procedures in any forfeiture under
this subsection, and the duties and authority of the courts
of the United States and the Attorney General with respect to
any forfeiture action under this subsection, or with respect
to any property that may be subject to forfeiture under this
subsection, shall be governed by the provisions of chapter 46
of title 18, United States Code (relating to criminal
forfeiture), to the same extent as property subject to
forfeiture under that chapter.
(c) Civil Penalties; Administrative Sanctions.--
[[Page S9028]]
(1) Civil penalties.--The Secretary may impose a civil
penalty of up to $500,000 for each violation of a provision
of this Act or any regulation, license, or order issued under
this Act. A civil penalty under this paragraph may be in
addition to, or in lieu of, any other liability or penalty
which may be imposed for such a violation.
(2) Denial of export privileges.--The Secretary may deny
the export privileges of any person, including the suspension
or revocation of the authority of such person to export or
receive United States-origin items subject to this Act, for a
violation of a provision of this Act or any regulation,
license, or order issued under this Act.
(3) Exclusion from practice.--The Secretary may exclude any
person acting as an attorney, accountant, consultant, freight
forwarder, or in any other representative capacity from
participating before the Department with respect to a license
application or any other matter under this Act.
(d) Payment of Civil Penalties.--
(1) Payment as condition of further export privileges.--The
payment of a civil penalty imposed under subsection (c) may
be made a condition for the granting, restoration, or
continuing validity of any export license, permission, or
privilege granted or to be granted to the person upon whom
such penalty is imposed. The period for which the payment of
a penalty may be made such a condition may not exceed 1 year
after the date on which the payment is due.
(2) Deferral or suspension.--
(A) In general.--The payment of a civil penalty imposed
under subsection (c) may be deferred or suspended in whole or
in part for a period no longer than any probation period
(which may exceed 1 year) that may be imposed upon the person
on whom the penalty is imposed.
(B) No bar to collection of penalty.--A deferral or
suspension under subparagraph (A) shall not operate as a bar
to the collection of the penalty concerned in the event that
the conditions of the suspension, deferral, or probation are
not fulfilled.
(3) Treatment of payments.--Any amount paid in satisfaction
of a civil penalty imposed under subsection (c) shall be
covered into the Treasury as miscellaneous receipts.
(e) Refunds.--
(1) Authority.--
(A) In general.--The Secretary may, in the Secretary's
discretion, refund any civil penalty imposed under subsection
(c) on the ground of a material error of fact or law in
imposition of the penalty.
(B) Limitation.--A civil penalty may not be refunded under
subparagraph (A) later than 2 years after payment of the
penalty.
(2) Prohibition on actions for refund.--Notwithstanding
section 1346(a) of title 28, United States Code, no action
for the refund of any civil penalty referred to in paragraph
(1) may be maintained in any court.
(f) Effect of Other Convictions.--
(1) Denial of export privileges.--Any person convicted of a
violation of--
(A) a provision of this Act or the Export Administration
Act of 1979,
(B) a provision of the International Emergency Economic
Powers Act (50 U.S.C. 1701 et seq.),
(C) section 793, 794, or 798 of title 18, United States
Code,
(D) section 4(b) of the Internal Security Act of 1950 (50
U.S.C. 783(b)),
(E) section 38 of the Arms Export Control Act (22 U.S.C.
2778),
(F) section 16 of the Trading with the Enemy Act (50 U.S.C.
App. 16),
(G) any regulation, license, or order issued under any
provision of law listed in subparagraph (A), (B), (C), (D),
(E), or (F),
(H) section 371 or 1001 of title 18, United States Code, if
in connection with the export of controlled items under this
Act or any regulation, license, or order issued under the
International Emergency Economic Powers Act, or the export of
items controlled under the Arms Export Control Act,
(I) section 175 of title 18, United States Code,
(J) a provision of the Atomic Energy Act (42 U.S.C. 201 et
seq.),
(K) section 831 of title 18, United States Code, or
(L) section 2332a of title 18, United States Code,
may, at the discretion of the Secretary, be denied export
privileges under this Act for a period not to exceed 10 years
from the date of the conviction. The Secretary may also
revoke any export license under this Act in which such person
had an interest at the time of the conviction.
(2) Related persons.--The Secretary may exercise the
authority under paragraph (1) with respect to any person
related through affiliation, ownership, control, or position
of responsibility to a person convicted of any violation of a
law set forth in paragraph (1) upon a showing of such
relationship with the convicted person. The Secretary shall
make such showing only after providing notice and opportunity
for a hearing.
(g) Statute of Limitations.--
(1) In general.--Except as provided in paragraph (2), a
proceeding in which a civil penalty or other administrative
sanction (other than a temporary denial order) is sought
under subsection (c) may not be instituted more than 5 years
after the later of the date of the alleged violation or the
date of discovery of the alleged violation.
(2) Exception.--
(A) Tolling.--In any case in which a criminal indictment
alleging a violation under subsection (a) is returned within
the time limits prescribed by law for the institution of such
action, the limitation under paragraph (1) for bringing a
proceeding to impose a civil penalty or other administrative
sanction under this section shall, upon the return of the
criminal indictment, be tolled against all persons named as a
defendant.
(B) Duration.--The tolling of the limitation with respect
to a defendant under subparagraph (A) as a result of a
criminal indictment shall continue for a period of 6 months
from the date on which the conviction of the defendant
becomes final, the indictment against the defendant is
dismissed, or the criminal action has concluded.
(h) Violations Defined by Regulation.--Nothing in this
section shall limit the authority of the Secretary to define
by regulation violations under this Act.
(i) Construction.--Nothing in subsection (c), (d), (e),
(f), or (g) limits--
(1) the availability of other administrative or judicial
remedies with respect to a violation of a provision of this
Act, or any regulation, order, or license issued under this
Act;
(2) the authority to compromise and settle administrative
proceedings brought with respect to any such violation; or
(3) the authority to compromise, remit, or mitigate
seizures and forfeitures pursuant to section 1(b) of title VI
of the Act of June 15, 1917 (22 U.S.C. 401(b)).
SEC. 504. MISSILE PROLIFERATION CONTROL VIOLATIONS.
(a) Violations by United States Persons.--
(1) Sanctions.--
(A) In general.--If the President determines that a United
States person knowingly--
(i) exports, transfers, or otherwise engages in the trade
of any item on the MTCR Annex, in violation of the provisions
of section 38 (22 U.S.C. 2778) or chapter 7 of the Arms
Export Control Act, title II or III of this Act, or any
regulations or orders issued under any such provisions,
(ii) conspires to or attempts to engage in such export,
transfer, or trade, or
(iii) facilitates such export, transfer, or trade by any
other person,
then the President shall impose the applicable sanctions
described in subparagraph (B).
(B) Sanctions described.--The sanctions which apply to a
United States person under subparagraph (A) are the
following:
(i) If the item on the MTCR Annex involved in the export,
transfer, or trade is missile equipment or technology within
category II of the MTCR Annex, then the President shall deny
to such United States person, for a period of 2 years,
licenses for the transfer of missile equipment or technology
controlled under this Act.
(ii) If the item on the MTCR Annex involved in the export,
transfer, or trade is missile equipment or technology within
category I of the MTCR Annex, then the President shall deny
to such United States person, for a period of not less than 2
years, all licenses for items the export of which is
controlled under this Act.
(2) Discretionary sanctions.--In the case of any
determination referred to in paragraph (1), the Secretary may
pursue any other appropriate penalties under section 503.
(3) Waiver.--The President may waive the imposition of
sanctions under paragraph (1) on a person with respect to an
item if the President certifies to Congress that--
(A) the item is essential to the national security of the
United States; and
(B) such person is a sole source supplier of the item, the
item is not available from any alternative reliable supplier,
and the need for the item cannot be met in a timely manner by
improved manufacturing processes or technological
developments.
(b) Transfers of Missile Equipment or Technology by Foreign
Persons.--
(1) Sanctions.--
(A) In general.--Subject to paragraphs (3) through (7), if
the President determines that a foreign person, after the
date of enactment of this section, knowingly--
(i) exports, transfers, or otherwise engages in the trade
of any MTCR equipment or technology that contributes to the
design, development, or production of missiles in a country
that is not an MTCR adherent and would be, if it were United
States-origin equipment or technology, subject to the
jurisdiction of the United States under this Act,
(ii) conspires to or attempts to engage in such export,
transfer, or trade, or
(iii) facilitates such export, transfer, or trade by any
other person,
or if the President has made a determination with respect to
a foreign person under section 73(a) of the Arms Export
Control Act, then the President shall impose on that foreign
person the applicable sanctions under subparagraph (B).
(B) Sanctions described.--The sanctions which apply to a
foreign person under subparagraph (A) are the following:
(i) If the item involved in the export, transfer, or trade
is within category II of the MTCR Annex, then the President
shall deny, for a period of 2 years, licenses for the
transfer to such foreign person of missile equipment or
technology the export of which is controlled under this Act.
(ii) If the item involved in the export, transfer, or trade
is within category I of the MTCR Annex, then the President
shall deny, for a period of not less than 2 years, licenses
for the transfer to such foreign person of items the export
of which is controlled under this Act.
(iii) If, in addition to actions taken under clauses (i)
and (ii), the President determines that the export, transfer,
or trade has substantially contributed to the design,
development, or production of missiles in a country that is
not an MTCR adherent, then the President shall prohibit, for
a period of not less than 2 years, the importation into the
United States of products produced by that foreign person.
[[Page S9029]]
(2) Inapplicability with respect to mtcr adherents.--
Paragraph (1) does not apply with respect to--
(A) any export, transfer, or trading activity that is
authorized by the laws of an MTCR adherent, if such
authorization is not obtained by misrepresentation or fraud;
or
(B) any export, transfer, or trade of an item to an end
user in a country that is an MTCR adherent.
(3) Effect of enforcement actions by mtcr adherents.--
Sanctions set forth in paragraph (1) may not be imposed under
this subsection on a person with respect to acts described in
such paragraph or, if such sanctions are in effect against a
person on account of such acts, such sanctions shall be
terminated, if an MTCR adherent is taking judicial or other
enforcement action against that person with respect to such
acts, or that person has been found by the government of an
MTCR adherent to be innocent of wrongdoing with respect to
such acts.
(4) Advisory opinions.--The Secretary, in consultation with
the Secretary of State and the Secretary of Defense, may,
upon the request of any person, issue an advisory opinion to
that person as to whether a proposed activity by that person
would subject that person to sanctions under this subsection.
Any person who relies in good faith on such an advisory
opinion which states that the proposed activity would not
subject a person to such sanctions, and any person who
thereafter engages in such activity, may not be made
subject to such sanctions on account of such activity.
(5) Waiver and report to congress.--
(A) Waiver.--In any case other than one in which an
advisory opinion has been issued under paragraph (4) stating
that a proposed activity would not subject a person to
sanctions under this subsection, the President may waive the
application of paragraph (1) to a foreign person if the
President determines that such waiver is essential to the
national security of the United States.
(B) Report to congress.--In the event that the President
decides to apply the waiver described in subparagraph (A),
the President shall so notify Congress not less than 20
working days before issuing the waiver. Such notification
shall include a report fully articulating the rationale and
circumstances which led the President to apply the waiver.
(6) Additional waiver.--The President may waive the
imposition of sanctions under paragraph (1) on a person with
respect to a product or service if the President certifies
to the Congress that--
(A) the product or service is essential to the national
security of the United States; and
(B) such person is a sole source supplier of the product or
service, the product or service is not available from any
alternative reliable supplier, and the need for the product
or service cannot be met in a timely manner by improved
manufacturing processes or technological developments.
(7) Exceptions.--The President shall not apply the sanction
under this subsection prohibiting the importation of the
products of a foreign person--
(A) in the case of procurement of defense articles or
defense services--
(i) under existing contracts or subcontracts, including the
exercise of options for production quantities to satisfy
requirements essential to the national security of the United
States;
(ii) if the President determines that the person to which
the sanctions would be applied is a sole source supplier of
the defense articles and services, that the defense articles
or services are essential to the national security of the
United States, and that alternative sources are not readily
or reasonably available; or
(iii) if the President determines that such articles or
services are essential to the national security of the United
States under defense coproduction agreements or NATO Programs
of Cooperation;
(B) to products or services provided under contracts
entered into before the date on which the President publishes
his intention to impose the sanctions; or
(C) to--
(i) spare parts,
(ii) component parts, but not finished products, essential
to United States products or production,
(iii) routine services and maintenance of products, to the
extent that alternative sources are not readily or reasonably
available, or
(iv) information and techno