Where Industry and Security Intersect
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The Commerce Department's amendments to the Export Administration Regulations implementing the Trade Sanctions and Export Enhancement Act of 2000 (TSRA) allow a wide range of food and agricultural exports to Cuba. BIS created a new License Exception, Agricultural Commodities (AGR), to authorize exports and certain reexports of eligible agricultural commodities that are classified as EAR99 (i.e., not listed on the Commerce Control List), to Cuba, subject to certain criteria and restrictions. TSRA expands the pool of eligible recipients in Cuba to include both government and non-government entities, as long as the end-users do not support international terrorism.
Dry fertilizers containing less than 15% ammonium nitrate by weight are eligible for License Exception AGR. Dry fertilizers containing 15% or more ammonium nitrate will be controlled under a new ECCN (Export Control Classification Number), 1C997, and are not eligible for License Exception AGR. Liquid fertilizers are eligible for AGR regardless of the concentration of ammonium nitrate. Pesticides and herbicides are not eligible for export or reexport under License Exception AGR, nor are exports or reexports of medicines and medical devices to Cuba. Medical items remain subject to the 1992 Cuban Democracy Act and require a standard license for export to Cuba. These include vaccines and immunotoxins that are classified on the CCL under ECCN 1C991.
The Treasury Department's Office of Foreign Assets Control (OFAC) implements TSRA as it relates to exports to Iran, Libya, and Sudan of agricultural commodities, medicines and medical devices.
The Bureau of Industry and Security evaluates items in applications submitted to OFAC to determine whether the item is controlled on the Commerce Control List (CCL). Therefore, exporters should include technical specifications in their applications related to the control parameters on the CCL for the category of item they intend to export. For example, an exporter interested in exporting chemicals should be aware that some chemicals and chemical mixtures are controlled on the CCL, and should supply sufficient information to identify the chemicals to be exported. We encourage exporters to include the Chemical Abstract Service (C.A.S.) Registry numbers, if they exist. Exporters should also provide information related to the form, composition, and the percentage concentration of each component of a mixture to total 100%, so that BIS may classify the chemicals accurately and in a timely manner. The same need for specific details applies to vaccines and medical kits containing biological toxins, some of which are controlled on the CCL. Certain vaccines and immunotoxins are classified under ECCN 1C991. If you do not submit the information we need, we will not be able to classify your item.
Individual components of equipment controlled under 2B350 are not controlled under 2B350 and do not require an export license to most destinations. However, Section 764.2(h) of the EAR prohibits exporters from engaging in transactions (such as disassembling equipment and exporting it as separate parts) with the intent to evade export controls. Also, impellers that are subject to the EAR are subject to the end-use restrictions described in Part 744.
Export control jurisdiction is determined by the nature of the primary use (civilian or military) of the item being exported. Since these kits are designed to destroy chemical and biological agents that are controlled pursuant to the International Traffic in Arms Regulations, exporters should contact the Department of State's Office of Defense Trade Controls for export authorization. However, certain incinerators designed to destroy chemical warfare agents or chemical weapons precursors controlled by ECCN 1C350 are controlled on the CCL under ECCN 2B350. Also, technology for the disposal of dual-use precursors or microbiological materials controlled under ECCNs 1C350-1C354 are controlled under ECCN 1E351.
When the item you seek to export is a chemical, you must provide the Chemical Abstract Service (C.A.S.) Registry numbers, if it exists. You should also provide information related to the form, composition, and concentrations of individual components in a mixture to total 100%. When the proposed export is for biological materials, a technical description of the item to be exported must be included.
In either case, the commodity must be appropriate for the proposed end-use, which should be described in detail. For example, specific herbicides or pesticides to be manufactured using controlled chemicals should be listed by trade or common name. Applications for use of chemicals or biological materials in research should describe how those items will be utilized in the research process. Moreover, medical literature can be, and frequently is, used to document the appropriateness of the proposed end-use as well as an end user's qualifications.
It is also helpful to describe the transaction fully. Commentary addressing the need for high volumes of a controlled item can also be helpful.
Under the sponsorship of the Government of Japan, U.S. companies may bid to provide the technology and equipment to incinerate the chemical weapons Japan abandoned in China after World War II. This is a multi-billion dollar undertaking. U.S. firms interested in participating by exporting controlled commodities and technology for the project to Japan, China or both are encouraged to contact the Chemical and Biological Controls Division of BIS at 202-501-7900 for guidance. Exporters are reminded that sharing controlled U.S. technology even in the bidding process may require an export license.
You could have submitted your application over the Internet via SNAP, the Simplified Network Application Process. You will receive a same day acknowledgment of your submission from BIS and you will have saved several days otherwise required for mailing and converting the application to an electronic format. Additional information about SNAP is available on BIS' Web site.
Information which substantiates the legitimate activities of the end-user could be supplied with the application. For example, medical researchers seeking chemicals or biological materials frequently have publication records that can document the qualifications of the researcher and the end-use. Supplying an unambiguous, detailed end-use description and a clear explanation of the transaction will help significantly reduce the need for interagency officials to contact an exporter for additional information, thus delaying a decision on an application.
You should also know your commodity, and whether it is on the Commerce Control List. BIS has received license applications for commodities that did not meet the control parameters and could have been exported without a license. If in doubt, you can, and should, request a commodity classification before applying for a license application.
A purchase order is not a prerequisite to obtaining an export license for an item controlled for CB reasons. However, Part 742.2(b) lists the existence of a pre-existing contract as a factor to be considered in evaluating a license application for exports of such items. Possession of a purchase order for a shipment to a country of concern may expedite the licensing process.
Our export control regimes are end user driven. Each end user must be reviewed individually, and larger numbers of end users obviously take longer. Should difficulties arise in obtaining the information needed to approve a given end user, the entire case is delayed. Experience has shown that limiting the number to 20 per license application minimizes the potential for delays in the review process.
License application for chemical and biological commodities are reviewed by the Departments of State and Defense, with input from the intelligence community. Cases that are escalated to the Operating Committee are also reviewed by the Department of Energy.
Industry standards for common equipment, such as pumps and valves, require their production from high quality materials. These same pieces of equipment can be used in chemical (or biological) weapons facilities. Controlling exports of this equipment supports the government's non-proliferation efforts.
No. PFIB is a CWC Schedule 2A chemical controlled under Export Control Classification Number 1C355 of the Export Administration Regulations (EAR). Consumer products for retail sale containing Schedule 2 chemicals may be exported without a license.
Regarding the export of a Teflon product that would not meet the definition of a consumer product: Under the EAR, export of PFIB requires a license if it is present in a mixture that contains more than 1% free PFIB. A mixture is made up of two or more components which do not react together under the conditions under which the mixture is stored; they can be separated by physical means. PFIB in Teflon is irreversibly reacted into Teflon and no longer can be separated readily. Therefore, the export of Teflon in its standard form is not considered to be the export of a mixture containing PFIB.
Yes. There are several provisions in the Export Administration Regulations that make the exporter responsible for the end-use of the exported items. These provisions are primarily in the end-use restrictions set out in Part 744. (These restrictions are often informally referred to as "EPCI" rules. (Enhanced Proliferation Control Initiative.)) One example of a Part 744 restriction is the requirement to obtain an export license for an item that would otherwise not need one, if the exporter knows or is informed that the item will be used in the design, development, production, stockpiling or use of chemical or biological weapons in a country of concern. There are several other provisions of Part 744 that you should consult.