
[Federal Register Volume 80, Number 15 (Friday, January 23, 2015)]
[Rules and Regulations]
[Pages 3463-3466]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-01273]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR Parts 738, 740, 742, and 758

[Docket No. 130405339-3339-01]
RIN 0694-AF72


U.S.-India Bilateral Understanding: Additional Revisions to the 
U.S. Export and Reexport Controls Under the Export Administration 
Regulations

AGENCY: Bureau of Industry and Security, Commerce.

ACTION: Final rule.

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SUMMARY: In this rule, the Bureau of Industry and Security (BIS) amends 
the Export Administration Regulations (EAR) to further implement the 
bilateral understanding between the United States and India announced 
by President Obama and India's Prime Minister Singh on November 8, 
2010. On January 25, 2011, BIS published the first rule in a series of 
rules to implement the bilateral understanding between the two 
countries. These rules fulfill the President's and Prime Minister's 
commitment to work together to strengthen the global nonproliferation 
and export control framework and further transform our bilateral export 
control cooperation to realize the full potential of the strategic 
partnership between the two countries. Specifically, in this rule, to 
further implement the November 8, 2010 bilateral understanding, BIS 
removes license requirements for certain items controlled for crime 
control and regional stability reasons to India. BIS also makes 
conforming changes in this rule.

DATES: This rule is effective January 23, 2015.

FOR FURTHER INFORMATION CONTACT: Chantal Lakatos, Office of 
Nonproliferation and Treaty Compliance, Bureau of Industry and 
Security, Department of Commerce, by telephone: (202) 482-1739; or by 
email: Chantal.Lakatos@bis.doc.gov.

SUPPLEMENTARY INFORMATION:

[[Page 3464]]

Background

U.S.-India Bilateral Understanding: Additional Revisions to the U.S. 
Export and Reexport Controls Under the Export Administration 
Regulations

    On January 25, 2011, the Bureau of Industry and Security (BIS) 
published a final rule, the first in a series of rules, which amended 
the Export Administration Regulations (EAR) to implement the U.S.-India 
bilateral understanding (76 FR 4228, January 25, 2011) (January 25 
rule). The January 25 rule and the bilateral understanding were the 
result of the November 8, 2010 Joint Statement issued by President 
Obama and Prime Minister Singh of India announcing that they had 
resolved to expand and strengthen the U.S.-India global strategic 
partnership. (U.S.-India Joint Statement, November 8, 2010). The Joint 
Statement covered a range of issues, activities, and programs that 
reflect the vision of the President and of India's Prime Minister. In 
the Joint Statement, the leaders reaffirmed that the U.S.-India 
strategic partnership is indispensable for global stability and 
prosperity and reaffirmed existing assurances regarding procurement and 
use by India of items subject to the EAR. In the Joint Statement, 
recognizing that India and the United States should play a leadership 
role in promoting global nonproliferation objectives and their desire 
to expand high technology cooperation and trade, the two leaders 
committed to work together to strengthen the global export control 
framework and further transform bilateral export control regulations 
and policies. The two nations decided to take mutual steps to expand 
U.S.-India cooperation in civil space, defense and other high 
technology sectors.
    The United States' implementation of the commitment included 
removing Indian defense and space related entities from the Entity 
List, as well as realigning India in U.S. export control regulations. 
Additionally, the Joint Statement announced that the United States 
``intends to support India's full membership in the four multilateral 
export control regimes (Nuclear Suppliers Group, Missile Technology 
Control Regime, Australia Group, and Wassenaar Arrangement) in a phased 
manner, and to consult with regime members to encourage the evolution 
of regime membership criteria . . . consistent with maintaining the 
core principles of these regimes, as the Government of India takes 
steps towards the full adoption of the regimes' export control 
requirements to reflect its prospective membership, with both processes 
moving forward together.'' The January 25 rule began the implementation 
of those reforms by revising certain export and reexport controls for 
India, including the removal of nine Indian entities from the Entity 
List. In addition, in the January 25 rule, BIS amended the EAR to 
remove India from Country Groups D:2, D:3, and D:4, and to add India to 
Country Group A:2 in Supplement No. 1 to Part 740. BIS also made 
conforming changes in the EAR.
    In this rule, BIS amends the EAR to further implement the November 
8, 2010 bilateral understanding between the United States and India. 
Specifically, this rule removes India from Crime Controls (CC) columns 
1 and 3, and Regional Stability (RS) column 2 on the Commerce Country 
Chart in Supplement No. 1 to Part 738 of the EAR because the Government 
of India has now taken appropriate steps to ensure that the specific 
U.S.-origin items controlled for CC and RS reasons are not reexported 
from India without a license. However, a license requirement remains 
for items controlled under export control classification numbers 
(ECCNs) 6A003.b.4.b and 9A515.e for RS column 2 reasons when destined 
to India. BIS also makes conforming changes in this rule. These 
changes, like those in the January 25 rule, are in the national 
interest of the United States.

Specific Additional Amendments to the EAR Further Implementing the 
U.S.-India Bilateral Understanding

Part 738--Commerce Control List Overview and the Country Chart
    BIS amends the EAR to remove the ``X'' in CC columns 1 and 3 and in 
RS column 2 for ``India'' in Supplement No. 1 to Part 738 of the EAR 
(Commerce Country Chart). These actions remove the license requirement 
for India for U.S.--origin items controlled under the EAR for CC 
columns 1 and 3 reasons and for RS column 2 reasons. BIS notes that the 
elimination of license requirements for RS column 2 items to India does 
not eliminate license requirements for items classified under ECCNs 
6A003.b.4.b and 9A515.e.
Part 758--Export Clearance Requirements
    In addition, BIS amends the EAR to establish a filing requirement 
in the Automated Export System (AES) for items exported to India when 
those items fall under an ECCN on the Commerce Control List in 
Supplement No. 1 to Part 774, for which CC columns 1 and 3, and RS 
column 2 are listed as reasons for control. Specifically, BIS amends 
section 758.1 of the EAR by adding new paragraph (b)(9) that requires 
exporters file an AES record for items controlled for CC 1 and 3 and RS 
2 reasons when such items are for export to India, regardless of value.
    BIS amends section 758.6 by adding new paragraph (c) requiring a 
notation on the invoice, bill of lading, air waybill, or other export 
control document that accompanies the shipment from its point of origin 
in the United States to the ultimate consignee or end-user in India. 
The notation will indicate the ECCNs of items for which CC columns 1 or 
3, or RS column 2 reasons for control are listed, that they are 
destined to India, and that authorization may be required from the U.S. 
Department of Commerce for reexport of the items.

Conforming Amendments

Section 740.2 (Restrictions on All License Exceptions) and Supplement 1 
to Part 738 (Commerce Country Chart)
    As a conforming change to removing the license requirement for 
India for items controlled for CC columns 1 and 3 reasons, BIS also 
amends section 740.2 of the EAR to add India to paragraph (a)(4)(i). 
Inclusion in paragraph (a)(4)(i) identifies India as one of the 
countries or organizations (i.e., Australia, Japan, New Zealand, or a 
NATO (North Atlantic Treaty Organization) member state) for which the 
restrictions on license exceptions due to license requirements 
described in section 742.7 (crime control and detection) do not apply. 
This status for India also broadens the availability of license 
exceptions under the EAR for items exported to India.
    BIS also amends the EAR to make a conforming change by adding a 
seventh footnote to Supplement No. 1 to Part 738 to notify exporters of 
an AES filing requirement for CC columns 1 and 3 items, and RS column 2 
items when they are intended for export to India. That footnote also 
notifies exporters that the elimination of license requirements for 
items controlled for RS column 2 reasons to India does not apply to 
items controlled under ECCNs 6A003.b.4.b and 9A515.e.
Section 742.6 (Regional Stability)
    Finally, BIS makes conforming changes in paragraph (a)(4)(i) of 
section 742.6 to add India to the list of countries for which a license 
is not required for items controlled for RS column 2 reasons for 
control, while also pointing out that a license requirement remains for 
items controlled under ECCNs 6A003.b.4.b and 9A515.e for RS column 2 
reasons when destined to India.

[[Page 3465]]

Export Administration Act

    Although the Export Administration Act expired on August 20, 2001, 
the President, through Executive Order 13222 of August 17, 2001, 3 CFR, 
2001 Comp., p. 783 (2002), as amended by Executive Order 13637 of March 
8, 2013, 78 FR 16129 (March 13, 2013) and as extended by the Notice of 
August 7, 2014, 79 FR 46959 (August 11, 2014), has continued the Export 
Administration Regulations in effect under the International Emergency 
Economic Powers Act. BIS continues to carry out the provisions of the 
Export Administration Act, as appropriate and to the extent permitted 
by law, pursuant to Executive Order 13222, as amended by Executive 
Order 13637.
    On January 20, 2015, the Under Secretary of Commerce for Industry 
and Security, pursuant to the authority delegated to him under section 
6(n)(2) of the Export Administration Act, designated India as an 
eligible destination for export and reexport of items controlled for 
crime control (CC) without a license.

Rulemaking Requirements

    1. Executive Orders 13563 and 12866 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. This rule has been designated a ``significant regulatory 
action,'' although not economically significant, under section 3(f) of 
Executive Order 12866. Accordingly, the rule has been reviewed by the 
Office of Management and Budget (OMB).
    2. Notwithstanding any other provisions of law, no person is 
required to respond to nor 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 OMB 
Control Number. This rule involves collections of information subject 
to the PRA. This collection has been approved by OMB under control 
numbers 0694-0088, ``Simplified Network Application Processing 
System,'' which includes among other things license applications and 
carries a burden hour estimate of 43.8 minutes for a manual or 
electronic application; and 0694-0122, ``Licensing Responsibilities and 
Enforcement,'' which carries a burden hour estimate of 5 seconds to 
manually or electronically complete each required export clearance 
document. Total burden hours associated with the PRA and OMB control 
numbers 0694-0088 and 0694-0122 are not expected to increase as a 
result of this rule.
    3. This rule does not contain policies with Federalism implications 
as that term is defined under Executive Order 13132.
    4. Pursuant to 5 U.S.C. 553(a)(1), the provisions of the 
Administrative Procedure Act requiring notice of proposed rulemaking, 
the opportunity for public participation, and a delay in effective 
date, are inapplicable because this regulation involves a military or 
foreign affairs function of the United States. (See 5 U.S.C. 
553(a)(1)). This rule further implements the phased aspects of the 
understanding between the United States and India reflected in the 
November 8, 2010 U.S.-India Joint Statement and is not discretionary. 
No other law requires that a notice of proposed rulemaking and an 
opportunity for public comment be given for this rule. Because a notice 
of proposed rulemaking and an opportunity for public comment are not 
required to be given for this rule by 5 U.S.C. 553, or by any other 
law, the analytical requirements of the Regulatory Flexibility Act, 5 
U.S.C. 601 et seq., are not applicable. Accordingly, no Regulatory 
Flexibility analysis is required and none has been prepared. 
Notwithstanding these considerations, BIS welcomes public comments and 
will review them on a continuing basis.

List of Subjects

15 CFR Part 738

    Exports.

15 CFR Parts 740 and 758

    Administrative practice and procedure, Exports, Reporting and 
recordkeeping requirements.

15 CFR Part 742

    Exports, Terrorism.

    Accordingly, parts 738, 740, 742, and 758 of the EAR (15 CFR parts 
730-774) are amended as follows:

PART 738--[AMENDED]

0
1. The authority citation for part 738 continues to read as follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
10 U.S.C. 7420; 10 U.S.C. 7430(e); 22 U.S.C. 287c; 22 U.S.C. 3201 et 
seq.; 22 U.S.C. 6004; 30 U.S.C. 185(s), 185(u); 42 U.S.C. 2139a; 42 
U.S.C. 6212; 43 U.S.C. 1354; 15 U.S.C. 1824a; 50 U.S.C. app. 5; 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; Notice of August 7, 2014, 79 FR 46959 (August 11, 2014).


0
2. Amend Supplement No. 1 to part 738 by:
0
a. Removing ``X'' in columns ``RS 2'' and ``CC 1 and 3'' for ``India''; 
and
0
b. Adding footnote designation 7 to ``India''; and
0
c. Adding footnote 7.
    The addition reads as follows:

Supplement No. 1 to Part 738--Commerce Country Chart

* * * * *
    \7\ See Sec.  758.1(b)(9) for an AES filing requirement for exports 
of CC column 1 or 3, or RS column 2 items to India. Also note that a 
license is still required for items controlled under ECCNs 6A003.b.4.b 
and 9A515.e for RS column 2 reasons when destined to India.

PART 740--[AMENDED]

0
3. The authority citation for part 740 continues to read as follows:

    Authority: 50 U.S.C. app. 2401 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; Notice 
of August 7, 2014, 79 FR 46959 (August 11, 2014).


0
4. Amend Sec.  740.2 by revising paragraph (a)(4)(i) to read as 
follows:


Sec.  740.2  Restrictions on all License Exceptions.

    (a) * * *
    (4) * * *
    (i) Being made to Australia, India, Japan, New Zealand, or a NATO 
(North Atlantic Treaty Organization) member state (see NATO membership 
listing in Sec.  772.1 of the EAR):
* * * * *

PART 742--[AMENDED]

0
5. The authority citation for part 742 continues to read as follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; 22 U.S.C. 7201 et seq.; 22 
U.S.C. 7210; Sec. 1503, Pub. L. 108-11, 117 Stat. 559; E.O. 12058, 
43 FR 20947, 3 CFR, 1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 
CFR, 1993 Comp., p. 608; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., 
p. 950; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 
13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Presidential 
Determination 2003-23 of May 7, 2003, 68 FR 26459, May 16, 2003; 
Notice of August 7, 2014, 79 FR

[[Page 3466]]

46959 (August 11, 2014); Notice of November 7, 2014, 79 FR 67035 
(November 12, 2014).


0
6. Amend Sec.  742.6 by revising paragraph (a)(4)(i) to read as 
follows:


Sec.  742.6  Regional stability.

    (a) * * *
    (4) * * *
    (i) License requirements applicable to most RS Column 2 items. As 
indicated in the CCL and in RS Column 2 of the Commerce Country Chart 
(see Supplement No. 1 to part 738 of the EAR), a license is required to 
any destination except Australia, India, Japan, New Zealand, and 
countries in the North Atlantic Treaty Organization (NATO) for all 
items in ECCNs on the CCL that include RS Column 2 in the Country Chart 
column of the ``License Requirements'' section. A license continues to 
be required for items controlled under ECCNs 6A003.b.4.b and 9A515.e 
for RS Column 2 reasons when destined to India.
* * * * *

PART 758--[AMENDED]

0
7. The authority citation for part 758 continues to read as follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 
7, 2014, 79 FR 46959 (August 11, 2014).


0
8. Amend Sec.  758.1 by adding paragraph (b)(9) to read as follows:


Sec.  758.1  The Electronic Export Information (EEI) filing to the 
Automated Export System (AES).

* * * * *
    (b) * * *
    (9) For items that fall under ECCNs that list CC Column 1 and 3 and 
RS Column 2 (see Supplement No. 1 to part 738 of the EAR) as reasons 
for control and such items are for export, regardless of value, to 
India.
* * * * *
0
9. Amend Sec.  758.6 by adding paragraph (c) to read as follows:


Sec.  758.6  Destination control statements and other information 
furnished to consignees.

* * * * *
    (c) Additional requirement for items under ECCNs for which CC 
Column 1 or 3 or RS Column 2 are listed as reasons for control and are 
destined to India. In addition to the DCS as required in paragraph (a) 
of this section, the following information must be printed on the 
invoice, bill of lading, air waybill, or other export control document 
that accompanies the shipment from its point of origin in the United 
States to the ultimate consignee or end-user in India: ``These items 
are classified under Export Control Classification Number(s) (ECCN(s)) 
[Fill-in the ECCNs for which CC 1 or 3 or RS 2 are listed as reasons 
for control] and destined to India. Authorization for reexport from 
India may be required from the U.S. Department of Commerce.''

    Dated: January 20, 2015.
Eric L. Hirschhorn,
Under Secretary for Industry and Security.
[FR Doc. 2015-01273 Filed 1-22-15; 8:45 am]
BILLING CODE 3510-33-P


