BIS Updates Regs on EAR De Minimis Provisions, Certain ECCN Controls, Etc.

The Bureau of Industry and Security has issued a final rule, effective June 4, 2010, which clarifies language concerning the de minimis provisions of the Export Administration Regulations and nuclear proliferation controls for certain turning machines, among other things.

Highlights of EAR Clarifying Amendments

The highlights of EAR amendments made by BIS’ final rule are as follows:

De minimis language. BIS’ final rule removes 15 CFR 734.3(b)(4), which states that foreign made items that have less than the de minimis percentage of controlled U.S. content are not subject to the EAR.

BIS is removing this section because it could be erroneously read as applying the de minimis exclusion to foreign made items that are located in the U.S. (Pursuant to 15 CFR 734.3(a)(1), all items, regardless of level of foreign content, are subject to the EAR if they are physically located in the U.S.)

Turning machine NP controls. BIS’ rule revises Export Control Classification Number 2B001, for numerically controlled machine tools for turning that have both a positioning accuracy better than 6 µm along any linear axis, and two or more axes that can be controlled simultaneously for contouring control, to state that the NP reason for control does not apply to “turning machines under 2B001.a with a capacity no greater than 35 mm diameter.”

(Prior to publication of this rule, ECCN 2B001 stated that the reason for NP control does not apply to “turning machines under 2B001.a with a capacity equal to or less than 35 mm diameter.”)

STELA updates. BIS’ rule updates references to the System for Tracking Export License Applications (STELA) in 15 CFR 740.5(d)(2), 740.7(d)(4)(ii) and 740.18(c)(5) to the Web address, and removes all references to the telephone system, as BIS has phased out the telephone version of STELA. (See ITT’s Online Archives or 03/31/10 news, 10033135, for BP summary.

Removal of general order restrictions. BIS’ final rule removes and reserves 15 CFR 744.15, which covered restrictions on exports and reexports involving persons named in general orders, as no such general orders exist, with the removal of General Order Number 3. (See ITT’s Online Archives or 09/23/08 news, 08092325, for BP summary of BIS’ removal of General Order No. 3 addition of the listed persons to the Entity List.)

(See BIS’ final rule for complete regulatory amendments, including the removal of obsolete cross references and regulatory provisions, correction of a typographical error regarding calculating adjusted peak performance, etc.)

BIS contact -- William Arvin (202) 482-2440

(D/N 0907271167-91198-01)