2024-10280. Conforming and Clarifying Changes to the Export Administration Regulations (EAR)

AGENCY:

Bureau of Industry and Security, Department of Commerce.

ACTION:

Final rule.

SUMMARY:

This final rule makes conforming and clarifying changes to the Export Administration Regulations (EAR). These changes include making conforming changes to the EAR to ensure that destination names reflect the current destination names that are recognized by the United States Government, clarifying the removal of certain license requirements for exports, reexports, and transfers (in-country) to and within Australia and the United Kingdom, making a conforming change to reflect that Cyprus is no longer a Country Group D:5 country, and clarifying how Russia and the Russian Federation are referenced for consistency with the designation of Russia as a U.S. Arms Embargoed destinations.

DATES:

This rule is effective May 30, 2024.

FOR FURTHER INFORMATION CONTACT:

For questions on this rule, contact Philip Johnson at [e-mail] or [phone].

SUPPLEMENTARY INFORMATION:

I. Background

BIS is amending the EAR (15 CFR parts 730-774) by making conforming changes to the EAR to ensure that destination names reflect the current destination names that are recognized by the United States Government, by making conforming changes to ensure that the EAR reflects amendments and description of those amendments made pursuant to two recent rules, by making a conforming change to reflect that Cyprus is no longer a Country Group D:5 country, and by clarifying how Russia and the Russian Federation are referenced in the EAR to ensure consistency with the designation of Russia as a U.S. Arms Embargoed destination.

The four sets of changes this final rule makes are described in section II as follows:

A. Conforming changes to the Commerce Country Chart and Country Groups to ensure consistency with destinations names that are recognized by the United States Government;

B. Conforming changes to the Commerce Country Chart entries for Australia and the United Kingdom;

C. Conforming change to reflect Cyprus is no longer a Country Group D:5 country; and

D. Removing obsolete references to Russia and the Russian Federation in provisions that predate the country's addition to Country Group D:5.

II. Regulatory Changes

A. Conforming Changes to the Commerce Country Chart and Country Groups To Ensure Consistency With Destination Names That Are Recognized by the United States Government

This final rule in supplement no. 1 to part 738 (Commerce Country Chart) removes Swaziland from the Commerce Country Chart and replaces it, in alphabetical order, with Eswatini. On April 19, 2018, King Mswati III declared that the country be known as the Kingdom of Eswatini, rather than the Kingdom of Swaziland. BIS makes this change to conform to King Mswati III's declaration, as subsequently formally recognized by the State Department ( see https://www.state.gov/​countries-areas/​eswatini/​). This final rule also removes Macedonia (The Former Yugoslav Republic of) from the Commerce Country Chart and replaces it, in alphabetical order, with North Macedonia. BIS makes this change to the conform to the State Department's formal recognition of the new name in February 2019 ( see https://history.state.gov/​countries/​macedonia). Lastly, this final rule removes Turkey from the Commerce Country Chart and replaces it, in alphabetical order, with Türkiye. BIS makes this change to conform to the State Department's recognition on January 9, 2023 of the new country's new name ( see https://www.state.gov/​countries-areas/​turkey/​). This rule revises only the names of the three countries; the information set forth in each of the three entries otherwise remains the same.

As a conforming change to the changes made to the Commerce Country Chart described above, this final rule removes Swaziland from Country Group B in supplement no. 1 to part 740, Country Groups), and replaces it (in alphabetical order) with Eswatini. Similarly, this rule removes Macedonia (the Former Yugoslav Republic of) from Country Group B and replaces it, in alphabetical order, with North Macedonia.

B. Conforming Changes to Commerce Country Chart Entries for Australia and the United Kingdom

This final rule also revises the Commerce Country Chart entries for Australia and the United Kingdom in supplement no. 1 to part 738 to align with the policy decisions and regulatory changes described and implemented in the August 19, 2024 interim final rule, “Export Control Revisions for Australia, United Kingdom, United States (AUKUS) Enhanced Trilateral Security Partnership” (89 FR 28594, published and effective on April 19, 2024) (April 19 IFR). Specifically, the April 19 IFR removed the license requirements for national security column 1 (NS1), regional stability column 1 (RS1), and missile technology column 1 (MT1) reasons for control for these two countries, as well as the footnote 3 designations for both of these countries, because the license requirements referenced in footnote 3 were no longer applicable.

This rule corrects inadvertent errors in which a subsequent interim final rule, “Revisions of Firearms License Requirements” (89 FR 34680, published on April 30, 2024, and effective on May 30, 2024) (April 30 IFR), erroneously included an “X” under the NS1, RS1, and MT1 reasons for control for Australia and the United Kingdom and also erroneously included the previously-applicable footnote 3 designation for these two countries. This final rule revises the entries for Australia and the United Kingdom by removing the license requirement for NS1, RS1, and MT1, as well as the footnote 3 designation, for consistency with the intended regulatory changes described in the April 19 IFR.

The changes in this final rule described under this section II.B are limited to removing text (as described above) that inadvertently appeared in the two Commerce Country Chart entries. The April 30 IFR correctly removed the footnote 9 designation for Australia and the United Kingdom. The April 30 IFR addressed the license requirement described in footnote 9 for these two destinations by adding an “X” in the crime control column 2 (CC2) reason for control for these two countries.

C. Conforming Change to Reflect the Fact That Cyprus is No Longer a Country Group D:5 Country

The U.S. State Department recently amended § 126.1 of the International Traffic in Arms Regulations (ITAR) (22 CFR parts 120 through 130) to specify that Cyprus's status as a proscribed destination is suspended from October 1, 2023 through September 30, 2024 (see 88 FR 63016). Consistent with this change, Cyprus was effectively removed from Country Group D:5. As set forth in the Note to Country Group D:5 in supplement no. 1 to part 740 of the EAR, if there are any discrepancies between the list of D:5 countries and the countries identified by the Department of State as subject to a U.S. arms embargo, the State Department's list shall be controlling. To avoid confusion on the part of exporters, reexporters, and transferors, this final rule removes Cyprus from D:5. D:5 was the only “X” in the entry for Cyprus under Country Group D, so the entry is no longer needed.

D. Removing, for Clarity, References to Russia and the Russian Federation for Provisions That Also extend to Country Group D:5

The final rule, “Implementation of Sanctions Against Russia Under the Export Administration Regulations (EAR)” (87 FR 12226, published March 3, 2022, and effective February 24, 2022), included amendments to supplement no. 1 to part 740 (Country Groups) of the EAR consistent with the ITAR § 126.1. The March 3 final rule updated the Country Group designation for Russia in supplement no. 1 to part 740 to reflect its identification by the Department of State as a country subject to a United States arms embargo. As noted above, BIS harmonizes the arms embargo-related provisions in the EAR with the Directorate of Defense Trade Control's (DDTC's) regulation of arms embargoes in § 126.1 of the ITAR. Three sections of the EAR, which predated the March 18, 2021 ( see86 FR 14802) addition of Russia to § 126.1 under the ITAR, continued to separately identify Russia or the Russian Federation from Country Group D:5. These references are unnecessary due to the fact that Russia was subsequently added to Country Group D:5. Specifically, this final rule revises § 734.18(a)(5)(iv); § 740.9(a) introductory text (the fourth and seventh sentences) and paragraph (b)(5)(ii); and § 758.10, Note 1 to paragraph (b)(1), by removing references to Russia or the Russian Federation when the same sentence also refers to Country Group D:5. In the case of § 740.9(b)(5)(ii), the broader exclusion under paragraph (b)(5)(i) means the narrow exclusion under (b)(5)(ii) should not include Russia, which is subject to the broader exclusion as a Country Group D:5 country.

Export Control Reform Act of 2018

On August 13, 2018, the President signed into law the John S. McCain National Defense Authorization Act for Fiscal Year 2019, which included the Export Control Reform Act of 2018 (ECRA), 50 U.S.C. 4801-4852. ECRA, as amended, provides the legal basis for BIS's principal authorities and serves as the authority under which BIS issues this rule.

Rulemaking Requirements

1. BIS has examined the impact of this rule as required by Executive Orders 12866, 13563, and 14094. Pursuant to E.O. 12866, as amended by E.O. 14094, this final rule has not been determined to be a “significant regulatory action.”

2. Notwithstanding any other provision of law, no person is required to respond to or be subject to a penalty for failure to comply with a collection of information, subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) (PRA), unless that collection of information displays a currently valid Office of Management and Budget (OMB) Control Number. This regulation involves an information collection approved by OMB under control number 0694-0088, Simplified Network Application Processing System. BIS does not anticipate a change to the burden hours associated with this collection as a result of this rule. Information regarding the collection, including all supporting materials, can be accessed at https://www.reginfo.gov/​public/​do/​PRAMain.

3. This rule does not contain policies with federalism implications as that term is defined under Executive Order 13132.

4. Pursuant to Section 1762 of ECRA (50 U.S.C. 4821), this action is exempt from the Administrative Procedure Act (APA) (5 U.S.C. 553) requirements for notice of proposed rulemaking, opportunity for public participation and delay in effective date. Additionally, this rule is exempt from the ordinary rulemaking requirements of the APA pursuant to 5 U.S.C. 553(a)(1) as a military or foreign affairs function of the United States Government.

5. Because neither the APA nor any other law requires that notice of proposed rulemaking and an opportunity for public comment be given for this rule, the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) are not applicable. Accordingly, no Final Regulatory Flexibility Analysis is required, and none has been prepared.

List of Subjects

15 CFR Part 734

• Administrative practice and procedure
• Exports
• Inventions and patents
• Research
• Science and technology

15 CFR Part 738

• Administrative practice and procedure
• Exports
• Reporting and recordkeeping requirements

15 CFR Part 740

• Administrative practice and procedure
• Exports
• Reporting and recordkeeping requirements

15 CFR Part 758

• Administrative practice and procedure
• Exports
• Reporting and recordkeeping requirements

• Exports
• Reporting and recordkeeping requirements

Accordingly, parts 734, 738, 740, and 758 of the Export Administration Regulations (15 CFR parts 730-774) are amended as follows:

PART 734—SCOPE OF THE EXPORT ADMINISTRATION REGULATIONS

1. The authority citation for 15 CFR part 734 is revised to read as follows:

Authority: 50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.;50 U.S.C. 1701 et seq.;E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13020, 61 FR 54079, 3 CFR, 1996 Comp., p. 219; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13637, 78 FR 16129, 3 CFR, 2014 Comp., p. 223; Notice of November 1, 2023, 88 FR 75475 (November 3, 2023).

2. Section 734.18(a)(5) is amended by revising paragraph (a)(5)(iv) to read as follows:

§ 734.18

Activities that are not exports, reexports, or transfers.

(a) * * *

(5) * * *

(iv) Not intentionally stored in a country listed in Country Group D:5 ( see supplement no. 1 to part 740 of the EAR).

Note 1 to paragraph (a)(5)(iv):

Data in-transit via the internet is not deemed to be stored.

* * * * *

PART 738—COMMERCE CONTROL LIST OVERVIEW AND THE COUNTRY CHART

3. The authority citation for 15 CFR part 738 continues to read as follows:

Authority: 50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.;50 U.S.C. 1701 et seq.;10 U.S.C. 8720; 10 U.S.C. 8730(e); 22 U.S.C. 287c; 22 U.S.C. 2151 note; 22 U.S.C. 3201 et seq.;22 U.S.C. 6004; 42 U.S.C. 2139a; 15 U.S.C. 1824; 50 U.S.C. 4305; 22 U.S.C. 7201 et seq.;22 U.S.C. 7210; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783.

4. Supplement no. 1 to part 738 is amended by:

a. Revising the entry for “Australia”;

b. Adding an entry for “Eswatini” in alphabetical order;

c. Removing the entries for “Macedonia (The Former Yugoslav Republic of)”;

d. Adding an entry for “North Macedonia” in alphabetical order;

e. Removing the entry for “Swaziland”;

f. Removing the entry for “Turkey”; and

g. Adding an entry for “Türkiye” in alphabetical order.

h. Revising the entry for the “United Kingdom”;

The additions and revisions read as follows:

Supplement No. 1 to Part 738—Commerce Country Chart

* * * * *

Countries	Chemical & biological weapons			Nuclear nonproliferation		National security		Missile tech	Regional stability		Firearms convention	Crime control			Anti- terrorism
	CB 1	CB 2	CB 3	NP 1	NP 2	NS 1	NS 2	MT 1	RS 1	RS 2	FC 1	CC 1	CC 2	CC 3	AT 1	AT 2
*         *         *         *         *         *         *
Australia	X												X
*         *         *         *         *         *         *
Eswatini	X	X		X		X	X	X	X	X		X	X	X
*         *         *         *         *         *         *
North Macedonia	X	X		X		X	X	X	X	X		X	X	X
*         *         *         *         *         *         *
Türkiye	X					X		X	X				X
*         *         *         *         *         *         *
United Kingdom	X												X
*         *         *         *         *         *         *

* * * * *

PART 740—LICENSE EXCEPTIONS

5. The authority citation for 15 CFR part 740 continues to read as follows:

Authority: 50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.;50 U.S.C. 1701 et seq.;22 U.S.C. 7201 et seq.;E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783.

6. Section 740.9 is amended by:

a. Removing “Russia,” in the fourth and seventh sentences of paragraph (a) introductory text wherever it appears; and

b. Removing “Russia,” in paragraph (b)(5)(ii) wherever it appears.

7. Supplement no. 1 to part 740 is amended by:

a. In the “Country Group A” and “Country Group B” tables, removing the entry for “Turkey” and adding an entry for “Türkiye” in alphabetical order;

b. In the “Country Group B” table:

i. Adding an entry for “Eswatini” in alphabetical order;

i. Removing the entry for “Macedonia, The Former Yugoslav Republic of”, and adding an entry for “North Macedonia” in alphabetical order;

ii. Removing the entry for “Swaziland”; and

c. In the “Country Group D” table, removing the entry for Cyprus.

The additions and revisions read as follows:

Supplement No. 1 to Part 740—Commerce Country Chart

Country Group A

Country	[A:1] Wassenaar participating states 1	[A:2] Missile technology control regime 2	[A:3] Australia group	[A:4] Nuclear suppliers group 3	[A:5]	[A:6]
*         *         *         *         *         *         *
Türkiye	X	X	X	X	X
*         *         *         *         *         *         *
*         *         *         *         *         *         *
1  Country Group A:1 is a list of the Wassenaar Arrangement Participating States, except for Malta, Russia and Ukraine.
2 Country Group A:2 is a list of the Missile Technology Control Regime countries, except for Russia.
3 Country Group A:4 is a list of the Nuclear Suppliers Group countries, except for the People's Republic of China (PRC), Russia, and Belarus.

* * * * *

Country Group B—Countries

* * * * *

Eswatini

* * * * *

North Macedonia

* * * * *

Türkiye

* * * * *

PART 758—EXPORT CLEARANCE REQUIREMENTS AND AUTHORITIES

8. The authority citation for 15 CFR part 758 continues to read as follows:

Authority: 50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.;50 U.S.C. 1701 et seq.;E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783.

9. Section 758.10 is amended by removing “Russia,” in Note 1 to paragraph (b)(1) wherever it appears.

Thea D. Rozman Kendler,

Assistant Secretary for Export Administration.