The Commerce Department is amending the Export Administration Regulations (EAR) to ease the licensing requirements on controlled exports to our COCOM partners, in addition to nations cooperating with COCOM controls and to reduce reexport licensing requirements.
The new regulations represent a substantial liberalization in export trade controls in high volume export markets. The rules will be issued in interim form and comments will be considered and will be taken into account by the department in developing final regulations.
Intra-COCOM Trade
1- The rule expands eligibility for additional controlled items for export under General License COCOM Trade (GCT). Items that no longer require a validated license for export to COCOM and countries cooperating with COCOM controls now include the full range of semiconductor manufacturing equipment, materials technology, computers and other items controlled for national security purposes.
-- Specifically, the rule makes nine types of goods and technologies eligible for export under General License GCT. Commerce validated licensing will no longer be required on roughly 95 percent of all national security controlled items exported to COCOM members and cooperating countries.
-- Items not eligible for exporting under this General License are limited to only a few critical items: supercomputers, cryptographic equipment, night-vision equipment, high-speed streak cameras, flash discharge x-ray equipment and items controlled for missile non-proliferation reasons.
-- Supercomputers, streak cameras and flash x-ray equipment have applicability in nuclear weapons development.
-- Cryptographic equipment can be utilized for the encryption and decryption of military and intelligence data.
-- Night-vision equipment has a variety of uses in military operations during night or other reduced visibility conditions, and in combat systems requiring enhanced imaging capability.
-- In order to comply with COCOM's understanding on intra-COCOM trade, certain COCOM Munitions List and Atomic Energy List items now eligible for GCT are made ineligible and will require a validated license.
Reexports
-- The rule addresses a major concern of U.S. industry and our allies regarding reexport controls.
-- The rule lifts a substantial burden on foreign customers of U.S. controlled items and recognizes that COCOM and cooperating countries have effective export control systems that meet COCOM standards and therefore exercise appropriate national controls.
-- The rule eliminates reexport controls on most U.S. controlled items reexported from a COCOM or COCOM cooperating countries to non-COCOM countries with two exceptions:
1) Reexport restrictions will continue to apply for items not eligible for General License GCT, plus items controlled for nonproliferation reasons (e.g. missile, nuclear, chemical, biological) and other items subject to foreign policy controls.
2) All reexports to regions and countries, other than COCOM proscribed
countries, on Commerce's nonproliferation lists (Supplements 4, 5 and 6 to
EAR Part 778).