BIS Rescinds Libya's Designation as a State Sponsor of Terrorism & Makes Revisions Applicable to Iraq (Part II - Libya)
The Bureau of Industry and Security (BIS) has issued an interim final rule, effective August 31, 2006, that amends the Export Administration Regulations (EAR) in order to implement the rescission of Libya's designation as a state sponsor of terrorism and to make certain changes regarding the October 2004 rescission of Iraq as a state sponsor of terrorism.
This is Part II of a multi-part series of summaries on the interim final rule and provides additional details on the interim rule's licensing requirement and exception provisions for Libya. See future issue of ITT for BP summary providing additional details on the interim rule's provisions on Iraq.)
According to BIS, the new Libya export licensing policy significantly reduces the level of U.S. government controls over commercial exports to Libya, which is consistent with Libya's removal from the list of Designated State Sponsors of Terrorism. BIS, however, retains restrictions on the export of multilaterally-controlled items and other sensitive items to Libya.
Revised License Requirements for Exports and Reexports to Libya
Items for which export license requirements are generally lifted. Under BIS' rule, items subject to the EAR but not listed on the Commerce Control List (CCL, 15 CFR part 774, i.e., EAR99 items) will generally not be subject to license requirements for export or reexport to Libya except pursuant to the end-user and end-use controls set forth in 15 CFR part 744.
In addition, items controlled only for anti-terrorism (AT) reasons on the CCL will no longer be subject to a licensing requirement for export or reexport to Libya, except for the end-use and end-user requirements noted above.
Also, the de minimis rules applicable to Libya are amended to reflect Libya's removal from Country Group E:1. Reexports of items to Libya from abroad are subject to the EAR only when U.S.-origin controlled content in such items exceeds 25% (instead of the 10% that applies to Country Group E:1 countries).
Items for which export license requirements will be retained. BIS' rule retains license requirements for the export or reexport to Libya of items on the multilateral export control regime lists (the Wassenaar Arrangement, the Nuclear Suppliers' Group, the Australia Group and the Missile Technology Control Regime) and items controlled for Crime Control (CC) or Regional Stability (RS) reasons. These license requirements are set forth in 15 CFR part 742 and are reflected in the relevant columns of the Country Chart in Supplement No. 1 to 15 CFR part 738.
Certain categories of items that are controlled for reasons not included on the Country Chart (e.g., encryption (EI), short supply (SS), and Chemical Weapons (CW)) also require a license for export or reexport to Libya.
Revised Licensing Policy for Libya
BIS states that it will review license applications for exports or reexports to Libya on a case-by-case basis pursuant to applicable licensing policies set forth in 15 CFR parts 742, 744, or elsewhere in the EAR.
Chemical and biological weapons (CB) -License applications for CB-controlled exports and reexports to Libya will be reviewed on a case-by-case basis consistent with the licensing policy set forth in 15 CFR 742.2.
Nuclear nonproliferation (NP) - License applications for NP-controlled exports and reexports to Libya will be reviewed on a case-by-case basis consistent with the licensing policy set forth in 15 CFR 742.3. Applications for exports and reexports to civil-end users and end-uses will generally be approved.
National security (NS) - License applications for NS-controlled exports and reexports to Libya will be reviewed on a case-by-case basis consistent with the licensing policy set forth in 15 CFR 742.4. Applications for exports and reexports to civil end-users and end-uses will generally be approved.
Missile-technology (MT) - License applications for MT-controlled exports and reexports to Libya will be reviewed on a case-by-case basis consistent with the licensing policy set forth in 15 CFR 742.5.
Regional stability (RS) - License applications for RS-controlled exports and reexports to Libya will be reviewed on a case-by-case basis consistent with the licensing policy set forth in 15 CFR 742.6.
Crime control (CC) - License applications for CC-controlled exports and reexports to Libya will be reviewed favorably on a case-by-case basis consistent with the licensing policy set forth in 15 CFR 742.7.
Libya to be an eligible destination for special comprehensive licenses. As a result of the rescission of Libya's designation as a state sponsor of terrorism, Libya will also be an eligible destination for special comprehensive licenses as described in 15 CFR part 752.
License Exceptions Available for Libya
This rule removes Libya from Country Group E:1, found in Supplement 1 to 15 CFR part 740. It adds Libya to Country Group D:1. Libya remains in Country Groups D:2, D:3, and D:4. As a result of Libya's inclusion in Country Groups D:1 through D:4, the following License Exceptions may be available, in whole or in part: CIV, APP, TMP, RPL, GOV, GFT, TSU, BAG, AVS, ENC and KMI. A specific transaction is eligible for a License Exception only if it satisfies all of the terms and conditions of the relevant License Exception and is not excluded by any of the restrictions that apply to all License Exceptions, as set forth in 15 CFR 740.2 (Restrictions on all License Exceptions) and
elsewhere in the EAR.
This rule adds Libya to Computer Tier 3 for exports or reexports of high performance computers under License Exception Computers (APP) in 15 CFR 740.7. Additionally, foreign nationals from Libya are now eligible to receive without a license "development" and "production" technology and source code for computers with an adjusted peak performance (APP) of less than or equal to 0.1 Weighted TeraFLOPS (WT) and "use" technology and source code for computers with an APP of less than or equal to 0.75 WT under License Exception APP subject to the Foreign National Review requirements of 15 CFR 740.7(d)(4).
This rule also removes License Exception USPL (15 CFR 740.19) from the EAR. This License Exception was established to allow for the export or reexport of certain items controlled for AT reasons only to U.S. persons in Libya. With the lifting of AT controls on Libya, BIS states that this License Exception has been rendered irrelevant.
(See ITT's Online Archives or 09/05/06 news, 06090520, for Part I of this multi-part series of summaries.)
- written comments due by October 2, 2006
BIS contact - Joan Roberts (202) 482-4252
BIS interim final rule (FR Pub 08/31/06, D/N 060816218-6218-01) available at http://a257.g.akamaitech.net/7/257/2422/01jan20061800/edocket.access.gpo.gov/2006/pdf/06-7255.pdf