09.09.2011

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Updates

The U.S. Bureau of Industry and Security ("BIS") has issued a request for public comments regarding the effect of extending current foreign policy-based export controls for another year.  76 Federal Register 54,426 (Sept. 1, 2011).

Pursuant to Section 6 of the Export Administration Act of 1979, as amended, the Export Administration Regulations ("EAR") include certain foreign policy-based export controls. Such controls require an annual extension, including a review by BIS, a request for public comment and a related report to Congress.

U.S. foreign policy-based export controls apply to a variety of items, persons and activities through the EAR's Commerce Control List, end-user and end-use controls, as well as embargoes and other special controls. Examples include:

  • Certain general purpose microprocessors for "military end-uses" and "military end-users." (§ 744.17)

  • Encryption items. (§ 742.15)

  • Crime control and detection items. (§ 742.7)

  • Certain sanctioned entities. (§ 744.20)

  • Certain cameras used by military end-users or incorporated into a military commodity. (§ 744.9)

  • Hot section technology for the development, production, or overhaul of commercial aircraft engines, components and systems. (§ 742.14)

Criteria used by BIS to determine whether to extend foreign policy-based export controls include, among others:

      • The likelihood that such controls will achieve their intended foreign policy purposes in light of other factors, such as foreign availability of the applicable item.

      • Whether such objectives can be achieved through negotiation or other means.

      • Whether the reaction of other countries would render the controls ineffective in meeting the foreign policy goal or be counterproductive to U.S. foreign policy interests.

      • The benefits to U.S. foreign policy objectives when compared with the effect on U.S. exports and competitiveness in international markets.

      BIS indicated several areas in which it is interested in receiving information on the economic impact of foreign policy-based controls including sales of U.S. products to other countries (those not subject to sanctions), controls maintained by U.S. trade partners including licensing policies and practices, and the effect of such controls on overall trade at the industrial sector level.

      In light of all the recent changes (including proposed rules) in U.S. export controls resulting from the President's Export Control Reform Initiative announced in 2009, this request provides a good opportunity to voice any concerns you may have with regard to foreign policy-based controls and their impact on your business and/or industry sector. Comments must be received by BIS by October 3, 2011.

      © 2011 Perkins Coie LLP


       

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