
[Federal Register Volume 80, Number 182 (Monday, September 21, 2015)]
[Rules and Regulations]
[Pages 56898-56904]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-23495]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR Parts 740, 746, and 772

[Docket No. 150825774-5774-01]
RIN 0694-AG67


Enhancing Support for the Cuban People

AGENCY: Bureau of Industry and Security, Commerce.

ACTION: Final rule.

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SUMMARY: This rule amends the Export Administration Regulations (EAR) 
to expand the scope of License Exception Support for the Cuban People 
(SCP) to facilitate engagement between the U.S. and Cuban people; the 
free flow of information to, from, and among the Cuban people; and 
independent economic activity generated by Cuba's private sector. It 
also makes temporary sojourns of most vessels to Cuba eligible for 
License Exception Aircraft, Vessels and Spacecraft (AVS). Additionally, 
this rule creates a case-by-case review policy of license applications 
to export and reexport to Cuba items to ensure the safety of civil 
aviation and safe operation of commercial passenger aircraft. Finally, 
it amends the deemed export and deemed reexport license requirements 
for releases of technology and source code to Cuban nationals; removes 
certain unintended restrictions on exports and reexports under License 
Exception SCP and License Exception Consumer Communications Devices 
(CCD); and makes certain technical corrections to License Exception 
Agricultural Commodities (AGR).

DATES: This rule is effective September 21, 2015.

FOR FURTHER INFORMATION CONTACT: Foreign Policy Division, Office of 
Nonproliferation and Treaty Compliance, Bureau of Industry and 
Security, Phone: (202) 482-4252.

SUPPLEMENTARY INFORMATION:

Background

    The United States maintains a comprehensive embargo on trade with 
Cuba. Pursuant to that embargo, all items that are subject to the 
Export Administration Regulations (EAR)

[[Page 56899]]

require a license for export or reexport to Cuba unless authorized by a 
license exception. The Bureau of Industry and Security (BIS) 
administers export and reexport restrictions on Cuba consistent with 
U.S. policy and relevant law. Accordingly, BIS may issue specific or 
general authorizations in the form of licenses or license exceptions 
for transactions that support the goals of United States policy while 
the embargo remains in effect.
    On December 17, 2014, the President announced that the United 
States is taking steps to chart a new course in bilateral relations 
with Cuba and to further engage and empower the Cuban people. The 
President explained that these steps build upon actions taken since 
2009 that have been aimed at supporting the ability of the Cuban people 
to gain greater control over their own lives and determine their 
country's future. On January 16, 2015, the Commerce and Treasury 
Departments took coordinated actions to implement certain elements of 
this policy, including changes to licensing policy and license 
exceptions in the EAR that are consistent with U.S. support for the 
Cuban people (see 80 FR 2286 and 80 FR 2291). Additionally, BIS 
published a rule implementing the May 29, 2015 rescission of Cuba's 
State Sponsor of Terrorism designation on July 22, 2015 (see 80 FR 
43314).
    The Commerce and Treasury Departments are taking additional 
coordinated actions in support of the President's Cuba policy. This 
rule amends the terms of existing license exceptions that are available 
for Cuba, increases the number of license exception provisions that are 
available for Cuba, and creates a new licensing policy in the EAR to 
further promote private sector economic activity in Cuba, facilitate 
travel to Cuba for authorized purposes, and help ensure safety in civil 
aviation and safe operation of commercial passenger aircraft. This rule 
also makes the deemed export and deemed reexport license requirements 
for Cuba consistent with other sanctioned destinations.

Specific Changes Made by This Rule

Expansion of License Exception Support for the Cuban People (SCP)

    This rule revises Sec.  740.21(b) and (d)(1) of the EAR to remove a 
requirement that items must be sold or donated when exported or 
reexported to authorized end-users in Cuba under License Exception 
Support for the Cuban People (SCP). Paragraph (b) authorizes certain 
exports and reexports to improve living conditions and support 
independent economic activity in Cuba. Paragraph (d)(1) authorizes 
certain exports and reexports to improve the free flow of information 
to, from, and among the Cuban people. When License Exception SCP was 
created in January 2015, BIS included text regarding sales or donations 
in paragraphs (b) and (d)(1) to clarify that the provisions were not 
limited to exports and reexports of donated items. However, the 
construction of the sentences addressing sales or donations 
inadvertently precluded other types of exports and reexports intended 
to be covered under the license exception, such as those involving 
leased or loaned items. Consequently, BIS is removing the portions of 
paragraphs (b) and (d)(1) of License Exception SCP that refer to sales 
or donations of items to eliminate those unintended restrictions.
    This rule revises paragraph (c)(2) of License Exception SCP to 
authorize certain temporary reexports to Cuba. Paragraph (c)(2) 
previously authorized certain temporary exports of items to Cuba from 
the United States for use in scientific, archeological, cultural, 
ecological, educational, historic preservation, or sporting activities, 
or in the traveler's professional research. This change authorizes 
travelers departing the United States or a foreign country to 
temporarily export or reexport authorized items to Cuba for eligible 
end-uses. Additionally, this rule adds professional meetings to the 
list of eligible end-uses in paragraph (c)(2). This rule also 
introduces a requirement that the items remain under the traveler's 
``effective control.'' The existing EAR definition of effective control 
in Sec.  772.1 applies to this use of the term. Eligible items continue 
to be limited to items subject to the EAR but not specified in any 
Export Control Classification Number (ECCN), i.e., EAR99) or controlled 
on the Commerce Control List (CCL) only for anti-terrorism reasons.
    This rule adds a new paragraph (d)(4) to License Exception SCP to 
authorize exports and reexports of commodities and software to 
individuals and private sector entities in Cuba that will be used to 
develop software that will improve the free flow of information or that 
will support the private sector activities described in paragraph (b) 
of License Exception SCP. The Cuban Government, Cuban Communist Party 
and certain officials thereof are designated as ineligible end users 
for commodities and software exported under paragraph (d)(4). Existing 
text in paragraph (d) limits the commodities and software authorized 
for export or reexport under this new paragraph (d)(4) to those that 
are either EAR99 (i.e., items subject to the EAR but not specified in 
any ECCN) or controlled on the CCL for anti-terrorism reasons only. For 
example, to qualify for export or reexport under new paragraph (d)(4), 
a general purpose software development kit must be either EAR99 or 
controlled in an ECCN where the only reason for control that applies to 
that kit is anti-terrorism and the kit's use in Cuba must be to develop 
software that will improve the free flow of communication and/or that 
will support the private sector activities described in paragraph (b) 
of License Exception SCP.
    This rule adds a new paragraph (e) to License Exception SCP. 
Paragraph (e)(1) authorizes the export and reexport to Cuba of certain 
items for use by United States Persons (as defined in Sec.  772.1 of 
the EAR) to establish, maintain, or operate a physical presence in 
Cuba. Any resulting payments associated with such a physical presence, 
such as lease payments, are permitted only to the extent authorized by 
Sec.  515.573 of the Cuban Assets Control Regulations (31 CFR 515.573). 
To be eligible for the exception under paragraph (e)(1), the end-users 
must be (1) entities organizing or conducting educational activities in 
Cuba authorized by the Department of the Treasury, Office of Foreign 
Assets Control (OFAC) pursuant to 31 CFR 515.565(a); (2) entities 
providing mail or parcel transmission services authorized by OFAC 
pursuant to 31 CFR 515.542(a) or providing cargo transportation 
services in connection with trade involving Cuba authorized by OFAC or 
exempt from the prohibitions of 31 CFR part 515 as specified in 31 CFR 
515.206; (3) religious organizations engaging in religious activities 
in Cuba authorized by OFAC pursuant to 31 CFR 515.566; (4) persons 
engaged in transactions authorized by OFAC pursuant to 31 CFR 
515.559(b); (5) persons that export or reexport items to Cuba that are 
exempt from the prohibitions of 31 CFR part 515 as specified in 31 CFR 
515.206; (6) providers of travel services or carrier services 
authorized by OFAC pursuant to 31 CFR 515.572; or (7) persons that 
export or reexport to Cuba pursuant to a license issued by BIS or a 
license exception authorized by Sec.  746.2(a)(1) of the EAR.
    Items eligible for export and reexport to Cuba pursuant to 
paragraph (e)(1) of License Exception SCP are limited to those 
designated as EAR99 (i.e., items subject to the EAR but not specified 
in any ECCN) or controlled on the CCL only for anti-terrorism reasons.
    Paragraph (e)(2) of License Exception SCP authorizes the export and 
reexport to Cuba of certain items for use by certain additional 
eligible end-users to

[[Page 56900]]

establish, maintain, and operate a physical presence in Cuba. Any 
resulting payments associated with such a physical presence, such as 
lease payments, are permitted only to the extent authorized by Sec.  
515.573 of the Cuban Assets Control Regulations (31 CFR 515.573). To be 
eligible for paragraph (e)(2), the end-users must be authorized by OFAC 
to provide telecommunications services and establish telecommunications 
facilities pursuant to 31 CFR 515.542(b)-(e) or to provide internet-
based services pursuant to 31 CFR 515.578, including subsidiaries, 
branches, offices, joint ventures, franchises, and agency or other 
business relationships with any entity or individual who is a national 
of Cuba. The items authorized pursuant to paragraph (e)(2) are limited 
to those designated as EAR99 (i.e., items subject to the EAR but not 
specified in any ECCN) or controlled on the CCL only for anti-terrorism 
reasons.
    Paragraph (e)(3) of License Exception SCP authorizes the export and 
reexport to Cuba of certain items to be given away for free as gifts 
for promotional purposes, such as pens, notepads, hats, and t-shirts. 
Items eligible for export or reexport to Cuba pursuant to paragraph 
(e)(3) are limited to those items of a type normally given away for 
free as gifts for promotional purposes that are designated as EAR99.
    BIS is creating paragraph (e) of License Exception SCP to 
facilitate engagement between the U.S. and Cuban people; the free flow 
of information to, from, and among the Cuban people; and independent 
economic activity in Cuba generated by Cuba's private sector.
    This rule also creates new paragraph (f) to License Exception SCP 
to authorize certain temporary (not to exceed one year) exports and 
reexports to Cuba of EAR99 items and items controlled on the CCL only 
for anti-terrorism reasons. Paragraph (f) authorizes exports and 
reexports of the following:
     Commodities and software as tools of trade for use by the 
exporters or employees of the exporters to install, service or repair 
items that are subject to the EAR and that have been exported or 
reexported to Cuba under a license or license exception, or foreign-
origin items that are not subject to the EAR but are owned and used 
exclusively by individuals or private sector entities but not the Cuban 
Government, the Cuban Communist Party or certain officials thereof in 
Cuba;
     Technology as tools of trade for use by certain persons 
for the installation, servicing or repair of items that are subject to 
the EAR and that have been exported or reexported to Cuba under a 
license or license exception, or foreign-origin items that are not 
subject to the EAR but are owned and used exclusively by individuals or 
private sector entities but not the Cuban Government, the Cuban 
Communist Party or certain officials thereof in Cuba;
     Kits of replacement parts or components for items that 
have been exported or reexported to Cuba under a license or license 
exception, or foreign-origin items that are not subject to the EAR but 
are owned and used exclusively by individuals or private sector 
entities but not the Cuban Government, the Cuban Communist Party or 
certain officials thereof in Cuba;
     Commodities and software for exhibition or demonstration 
at trade shows or to parties eligible to receive items under License 
Exception SCP; and
     Containers that are necessary for shipment of commodities 
being exported or reexported to Cuba under a license or license 
exception; BIS is creating paragraph (f) of License Exception SCP to 
help support authorized travel and commerce.

Expansion of License Exception Consumer Communications Devices (CCD)

    This rule revises Sec.  740.19(a) of the EAR to remove references 
to sales or donations of eligible items authorized under License 
Exception CCD. License Exception CCD authorizes certain exports and 
reexports to improve the free flow of information to, from, and among 
the Cuban and Sudanese people. When License Exception CCD was created 
in September 2009 to authorize certain exports and reexports to Cuba, 
the license exception included a donation requirement. BIS revised 
License Exception CCD in January 2015 to authorize sales, in addition 
to donations, and to update the list of eligible items. (Sudan was 
added as an authorized destination in February 2015.) Instead of merely 
removing the word ``donated'' from paragraph (a) of License Exception 
CCD, the January 2015 revision added the phrase ``either sold or'' to 
that paragraph. That phrasing inadvertently precluded other types of 
exports and reexports intended to be authorized by the license 
exception, such as those involving leased or loaned items. 
Consequently, this rule removes phrase ``either sold or donated'' from 
paragraph (a) to eliminate that unintended restriction.

Availability of License Exception Aircraft, Vessels and Spacecraft 
(AVS)

    This rule revises Sec.  746.2(a)(1)(x) of the EAR to make 
paragraphs (b) and (d) of License Exception AVS available for Cuba. It 
also amends Sec.  740.15(b) and (d) of the EAR to add to License 
Exception AVS paragraphs (b)(4) and (d)(6) described below that apply 
only to Cuba.
    Paragraph (b) of License Exception AVS authorizes certain exports 
and reexports of equipment and spare parts for permanent use on vessels 
and aircraft departing the United States. The paragraph also authorizes 
certain exports of ship and plane stores for use on board vessels and 
aircraft departing the United States. Paragraph (d) of License 
Exception AVS authorizes certain exports and reexports of vessels on 
temporary sojourn. Paragraph (a) of License Exception AVS, which 
authorizes certain exports and reexports of aircraft on temporary 
sojourn, was, prior to publication of this rule, available for Cuba.
    This rule adds a note to paragraph (a) prohibiting an aircraft 
exported or reexported to a country pursuant to that paragraph from 
remaining in that country for more than seven consecutive days before 
it departs for a country to which it may be exported without a license 
or the United States.
    This rule also adds new paragraph (b)(4) to License Exception AVS 
to specify that the commodities eligible for export and reexport to 
Cuba pursuant to paragraph (b) are limited to those designated as EAR99 
(i.e., items subject to the EAR but not specified in any ECCN) or 
controlled on the CCL only for anti-terrorism reasons.
    Additionally, this rule adds new paragraph (d)(6) to License 
Exception AVS. Paragraph (d)(6) provides that only certain categories 
of vessels, when engaged in specified activities are eligible for the 
license exception when destined for Cuba. The types of vessels and 
activities eligible for temporary sojourn to Cuba are as follows.
    (1) Cargo vessels for hire for use in the transportation of items.
    (2) Passenger vessels for hire for use in the transportation of 
passengers and/or items. Vessels used to transport both passengers and 
items to Cuba may transport automobiles only if the export or reexport 
of the automobiles has been authorized by a separate license issued by 
BIS (i.e., not authorized by license exception). The export or reexport 
to Cuba of personally owned vehicles is not normally necessary to 
support authorized travel. However, if the need arises, the exporter or 
reexporter may

[[Page 56901]]

submit a license application to BIS for review pursuant to the 
licensing policy in Sec.  746.2 of the EAR.
    (3) Recreational vessels destined for Cuba that that are used in 
connection with travel authorized by the Department of the Treasury, 
Office of Foreign Assets Control (OFAC).
    Finally, this rule adds a note to paragraph (d) prohibiting a 
vessel exported or reexported to a country pursuant to that paragraph 
from remaining in that country for more than 14 consecutive days before 
it departs for a country to which it may be exported without a license 
or the United States.
    BIS is making paragraphs (b) and (d) of License Exception AVS 
available for Cuba to help facilitate authorized travel and commerce. 
For clarity, BIS is adding notes to paragraphs (a) and (d) specifying 
the amount of time an aircraft or vessel exported or reexported to a 
country pursuant to the paragraphs may remain in that country. 
Previously, BIS interpreted paragraph (a) to authorize temporary 
sojourns consisting of only one overnight stay while in-country (see 57 
FR 30899, July 13, 1992). BIS selected the time periods of seven days 
for aircraft and 14 days for vessels based on its experience in 
licensing aircraft and vessels for temporary sojourn to Cuba. The vast 
majority of such licenses were for stays of seven days or less for 
aircraft and 14 days or less for vessels.

New Licensing Policy for Civil Aviation Safety

    This rule amends the licensing policy for Cuba in Sec.  746.2 of 
the EAR to add a policy of case-by-case review of license applications 
for exports and reexports of items to ensure safety in civil aviation 
and safe operation of commercial passenger aircraft. Items that will be 
reviewed pursuant to this policy include aircraft parts and components 
related to safety of flight, weather observation stations, airport 
safety equipment, and commodities used for security screening of 
passengers. BIS is adding this licensing policy to support 
international aviation and passenger safety.

Scope of License Requirements for Deemed Exports and Reexports

    This rule amends the license requirements for Cuba in Sec.  746.2 
of the EAR to specify that a license is required for the release of 
technology or source code on the CCL to Cuban nationals in the United 
States or a third country, but not for the deemed export or deemed 
reexport of technology or source code designated as EAR99. As described 
in Sec.  734.2(b), any release of technology or source code subject to 
the EAR is deemed to be an export to the home country or countries of 
the foreign national unless the foreign national is lawfully admitted 
for permanent residence in the United States or unless the foreign 
national is a protected individual under the Immigration and 
Nationality Act (8 U.S.C. 1324b(a)(3)). Additionally, any release of 
technology or source code subject to the EAR to a foreign national of 
another country is deemed to be a reexport to the home country or 
countries of the foreign national unless the foreign national is 
lawfully admitted for permanent residence. Prior to this amendment, a 
license was required for the deemed export or deemed reexport of any 
technology or source code subject to the EAR to a Cuban national. BIS 
is making this change for consistency with the current deemed export 
and deemed reexport license requirements for other sanctioned 
destinations.

Technical Corrections to License Exception Agricultural Commodities 
(AGR)

    On July 22, 2015, BIS published a rule implementing the rescission 
of Cuba's State Sponsor of Terrorism designation (80 FR 43314). Among 
other amendments, that rule removed Cuba from Country Group E:1 in 
Supplement No. 1 to part 740 of the EAR, which changed the general de 
minimis level for Cuba from 10 to 25 percent. Although the rule made 
certain technical and conforming changes to the EAR, BIS overlooked 
references to the former 10 percent de minimis level in paragraph 
(b)(3) of License Exception Agricultural Commodities (AGR) in Sec.  
740.18 of the EAR. Consequently, this rule corrects the de minimis 
percentages referenced in paragraph (b)(3) of License Exception AGR.

Conforming Changes to Definition of U.S. Person

    Paragraph (a) of the definition of U.S. Person in Sec.  772.1 of 
the EAR identifies the EAR provisions to which the definition applies. 
This rule adds a reference to Sec.  740.21(e)(1) to paragraph (a) of 
the definition. Paragraph (b) of the definition identifies EAR 
provisions that have definitions that are specific to those provisions. 
This rule adds a reference to Sec.  740.21(f)(2) to paragraph (b) of 
the definition. Both changes are to make those paragraphs conform to 
changes that this rule makes to Sec.  740.21.

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, 2015, 80 FR 48233 (August 11, 2015), 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.

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 provision of law, no person is 
required to respond to, nor shall any person 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 a collection of 
information approved under OMB control number 0694-0088--Simplified 
Network Application Processing+ System (SNAP+) and the Multipurpose 
Export License Application, which are the methods for submitting all 
license applications, commodity classification requests and similar 
requests to BIS. The estimated annual total burden of all of those 
submissions is 31,833 hours. BIS believes that this rule will slightly 
reduce that burden because additional transactions will be eligible for 
export or reexport to Cuba pursuant to license exception, thereby 
reducing the number of license applications submitted to BIS. Send 
comments regarding this burden estimate or any other aspect of this 
collection of information, including suggestions for reducing the 
burden, to Jasmeet K. Seehra, Office of

[[Page 56902]]

Management and Budget, by email at jseehra@omb.eop.gov or by fax to 
(202) 395-7285 and to William Arvin at william.arvin@bis.doc.gov.
    3. This rule does not contain policies with Federalism implications 
as that term is defined under Executive Order 13132.
    4. The provisions of the Administrative Procedure Act (5 U.S.C. 
553) 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 is a part of a 
foreign policy initiative to change the nature of the relationship 
between Cuba and the United States announced by the President on 
December 17, 2014. Delay in implementing this rule to obtain public 
comment would undermine the foreign policy objectives that the rule is 
intended to implement. Further, 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 under 5 
U.S.C. 553, or by any other law, the requirements of the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.) are not applicable.

List of Subjects

15 CFR Part 740

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

15 CFR Part 746

    Exports, Reporting and recordkeeping requirements.

15 CFR Part 772

    Exports.

    For the reasons set forth in the preamble, the Export 
Administration Regulations (15 CFR parts 730 through 774) are amended 
as follows:

PART 740--[AMENDED]

0
1. The authority citation for 15 CFR 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, 2015, 80 FR 48233 (August 11, 2015).

0
2. Section 740.15 is amended by adding:
0
a. A note to paragraph (a);
0
b. Paragraphs (b)(4) and (d)(6); and
0
c. A note to paragraph (d).
    The additions read as follows:


Sec.  740.15  Aircraft, vessels and spacecraft (AVS).

* * * * *
    (a) * * *

    Note to paragraph (a).  An aircraft exported or reexported to a 
country pursuant to this paragraph (a) may not remain in that 
country for more than seven consecutive days before it departs for a 
country to which it may be exported without a license or the United 
States.

    (b) * * *
    (4) Cuba. Only items designated as EAR99 or controlled on the 
Commerce Control List (CCL) (Supplement No. 1 to part 774 of the EAR) 
only for anti-terrorism reasons (i.e., anti-terrorism must be the only 
reason for control that applies to the item as set forth in the Export 
Control Classification Number (ECCN) that controls the item) are 
eligible for export or reexport to Cuba pursuant to this paragraph (b).
* * * * *
    (d) * * *
    (6) Cuba. Only the types of vessels listed in this paragraph (d)(6) 
departing for Cuba for the purposes listed in this paragraph (d)(6) may 
depart for Cuba pursuant to this paragraph (d). Vessels used to 
transport both passengers and items to Cuba may transport automobiles 
only if the export or reexport of the automobiles to Cuba have been 
authorized by a separate license issued by BIS (i.e., not authorized by 
license exception).
    (i) Cargo vessels for hire for use in the transportation of items;
    (ii) Passenger vessels for hire for use in the transportation of 
passengers and/or items; and
    (iii) Recreational vessels that are used in connection with travel 
authorized by the Department of the Treasury, Office of Foreign Assets 
Control (OFAC).

    Note to paragraph (d).  A vessel exported or reexported to a 
country pursuant to this paragraph (d) may not remain in that 
country for more than 14 consecutive days before it departs for a 
country to which it may be exported without a license or the United 
States.

* * * * *


Sec.  740.18--[Amended]  

0
3. Section 740.18 is amended by removing the number ``10%'' wherever it 
appears in paragraph (b)(3) and adding in its place the number ``25%''.


Sec.  740.19--[Amended]  

0
4. Section 740.19 is amended by removing ``, either sold or donated,'' 
from paragraph (a).

0
5. Section 740.21 is amended by:
0
a. Removing the third sentence from paragraph (b) introductory text;
0
b. Revising paragraph (c)(2) introductory text;
0
c. Redesignating paragraph (c)(2)(iii) and (iv) as paragraphs 
(c)(2)(iv) and (v), respectively;
0
d. Adding paragraph (c)(2)(iii);
0
e. Removing ``, either sold or donated,'' from paragraph (d)(1); and
0
f. Adding paragraphs (d)(4), (e), and (f).
    The revision and additions read as follows:


Sec.  740.21  Support for the Cuban People (SCP).

* * * * *
    (c) * * *
    (2) The temporary export or reexport to Cuba of items by travelers 
to Cuba for the travelers' use in scientific, archeological, cultural, 
ecological, educational, historic preservation, or sporting activities, 
or professional meetings or research. The following requirements apply:
* * * * *
    (iii) The items must remain under the traveler's ``effective 
control'' while in Cuba.
* * * * *
    (d) * * *
    (4) The export or reexport to Cuba of commodities or software that 
will be used by individuals or private sector entities to develop 
software that will improve the free flow of information or that will 
support the private sector activities described in paragraph (b) of 
this section.
    The following are ineligible end-users:
    (i) The Cuban Government or the Cuban Communist Party and 
organizations they administer or control;
    (ii) Ministers and vice-ministers; members of the Council of State; 
members of the Council of Ministers; members and employees of the 
National Assembly of People's Power; members of any provincial 
assembly; local sector chiefs of the Committees for the Defense of the 
Revolution; Director Generals and sub-Director Generals and higher of 
all Cuban ministries and state agencies; employees of the Ministry of 
the Interior (MININT); employees of the Ministry of Defense (MINFAR); 
secretaries and first secretaries of the Confederation of Labor of Cuba 
(CTC) and its component unions; chief editors, editors and deputy 
editors of Cuban state-run media organizations and programs, including 
newspapers, television, and radio; or members and employees of the 
Supreme Court (Tribuno Supremo Nacional); and

[[Page 56903]]

    (iii) Members of the Politburo; the Central Committee; Department 
Heads of the Central Committee; employees of the Central Committee; and 
the secretaries and first secretaries of provincial Party central 
committees.
    (e) Facilitating engagement, communications, and commerce. This 
paragraph (e) authorizes the export or reexport to Cuba of certain 
items intended to facilitate engagement between the U.S. and Cuban 
people; the free flow of information to, from, and among the Cuban 
people; and independent economic activity in Cuba. The export or 
reexport must be within one or more of the following categories:
    (1) The export or reexport to Cuba of items for use by eligible 
end-users to establish, maintain, or operate a physical presence in 
Cuba. The items authorized pursuant to this paragraph (e)(1) are 
limited to those designated as EAR99 (i.e., items subject to the EAR 
but not specified in any ECCN) or controlled on the CCL only for anti-
terrorism reasons. To be eligible, the end-users must be ``U.S. 
Persons,'' as defined in Sec.  772.1 of the EAR, and must fall within 
one of the following categories:
    (i) Entities organizing or conducting educational activities in 
Cuba authorized by the Department of the Treasury, Office of Foreign 
Assets Control (OFAC) pursuant to 31 CFR 515.565(a);
    (ii) Entities providing mail or parcel transmission services 
authorized by OFAC pursuant to 31 CFR 515.542(a) or providing cargo 
transportation services in connection with trade involving Cuba 
authorized by OFAC or exempt from the prohibitions of 31 CFR part 515 
as specified in 31 CFR 515.206;
    (iii) Religious organizations engaging in religious activities in 
Cuba authorized by OFAC pursuant to 31 CFR 515.566;
    (iv) Persons engaged in transactions authorized by OFAC pursuant to 
31 CFR 515.559(b);
    (v) Persons that export or reexport items to Cuba that are exempt 
from the prohibitions of 31 CFR part 515 as specified in 31 CFR 
515.206;
    (vi) Providers of travel services or carrier services authorized by 
OFAC pursuant to 31 CFR 515.572; or
    (vii) Persons that export or reexport to Cuba pursuant to a license 
issued by BIS or a license exception authorized by Sec.  746.2(a)(1) of 
the EAR.
    (2) The export or reexport to Cuba of certain items for use by 
eligible end-users to establish, maintain, or operate a physical 
presence in Cuba. To be eligible for this paragraph (e)(2), the end-
users must be authorized by OFAC to provide telecommunications services 
and establish telecommunications facilities pursuant to 31 CFR 
515.542(b) through (e) or to provide internet-based services pursuant 
to 31 CFR 515.578, including subsidiaries, branches, offices, joint 
ventures, franchises, and agency or other business relationships with 
any entity or individual who is a national of Cuba. The items 
authorized pursuant to this paragraph are limited to those designated 
as EAR99 (i.e., items subject to the EAR but not specified in any ECCN) 
or controlled on the CCL only for anti-terrorism reasons.
    (3) The export or reexport to Cuba of items to be given away for 
free as gifts for promotional purposes. Items authorized pursuant to 
this paragraph (e)(3) are limited to those items of a type normally 
given away for free as gifts for promotional purposes that are 
designated as EAR99 (i.e., items subject to the EAR but not specified 
in any ECCN).

    Note to paragraph (e).  Any resulting payments associated with 
establishing maintaining or operating a physical presence in Cuba, 
such as lease payments, are permitted only to the extent authorized 
by Sec.  515.573 of the Cuban Assets Control Regulations (31 CFR 
515.573).

    (f) Temporary exports and reexports to Cuba. This paragraph (f) 
authorizes the export or reexport to Cuba, for periods not exceeding 
one year, of certain items designated as EAR99 or controlled only for 
anti-terrorism reasons on the CCL (i.e., anti-terrorism must be the 
only reason for control that applies to the item as set forth in the 
ECCN that controls the item). If any other reason for control applies 
to the item, it is not authorized for export or reexport by this 
paragraph. This paragraph does not authorize any transaction if the 
exporter or reexporter has ``knowledge'' that the item is intended to 
remain in Cuba for more than one year; if an order to acquire the item, 
such as a purchase order, has been received before shipment; or when 
the item is for subsequent lease or rental. The export or reexport must 
be within one or more of the following categories.
    (1) Tools of trade--commodities and software. Commodities or 
software to be used by the exporter or reexporter or its employees for 
the installation, servicing or repair of items that are subject to the 
EAR and that have been exported or reexported to Cuba under a license 
or license exception, or foreign-origin items that are not subject to 
the EAR that are owned and used exclusively by private sector entities 
in Cuba, may be exported or reexported under this paragraph (f). The 
commodities or software must remain under the ``effective control'' of 
the exporter or reexporter or its employees. Examples of security 
precautions to help prevent unauthorized access include the following:
    (i) Use of secure connections, such as Virtual Private Network 
connections, when accessing IT networks for activities that involve the 
transmission and use of the software authorized under this license 
exception;
    (ii) Use of password systems on electronic devices that store the 
software authorized under this license exception; and
    (iii) Use of personal firewalls on electronic devices that store 
the software authorized under this license exception.
    (2) Tools of trade--technology. Technology to be used by a `U.S. 
person' exporter or reexporter or its employees who are traveling to or 
on temporary assignment in Cuba for the installation, servicing or 
repair of items that are subject to the EAR and that have been exported 
or reexported to Cuba under a license or license exception, or foreign-
origin items that are not subject to the EAR that are owned and used 
exclusively by private sector entities in Cuba, may be exported or 
reexported under this paragraph (f). For purposes of this paragraph 
(f)(2), a `U.S. person' is: an individual who is a citizen of the 
United States, an individual who is ``lawfully admitted for permanent 
residence'' in the United States as defined by 8 U.S.C. 1101(a)(20) or 
an individual who is a protected individual as defined by 8 U.S.C. 
1324b(a)(3). `U.S. person' also means any juridical person organized 
under the laws of the United States, or any jurisdiction within the 
United States (e.g., corporation, business association, partnership, 
society, trust, or any other entity, organization or group that is 
authorized to do business in the United States). If the employee who 
will use the technology is not a `U.S. person,' the release of that 
technology to that employee must either not require a license or be 
authorized by a license or a license exception other than this section 
before it may be exported or reexported to that employee under this 
paragraph. The exporter or reexporter and the recipient of the 
technology must take security precautions to protect against 
unauthorized release of the technology while the technology is being 
shipped or transmitted and used overseas. Examples of security 
precautions to help prevent unauthorized access include the following:
    (i) Use of secure connections, such as Virtual Private Network 
connections, when accessing IT networks for email

[[Page 56904]]

and other business activities that involve the transmission and use of 
the technology authorized under this license exception;
    (ii) Use of password systems on electronic devices that will store 
the technology authorized under this license exception; and
    (iii) Use of personal firewalls on electronic devices that will 
store the technology authorized under this license exception.
    (3) Kits of replacement ``parts'' or ``components.'' Kits 
consisting of replacement ``parts'' or ``components'' for items that 
have been exported or reexported to Cuba under a license or license 
exception, or foreign-origin items that are not subject to the EAR that 
are owned and used exclusively by private sector entities in Cuba, may 
be exported or reexported under this paragraph (f)(3) provided:
    (i) The kits remain under ``effective control'' of the exporter or 
reexporter or its employees; and
    (ii) All parts and components in the kit are returned, except that 
one-for-one replacements may be made in accordance with the 
requirements of License Exception Servicing and Replacement of Parts 
and Equipment (RPL) and the defective parts and components returned 
(see Parts, Components, Accessories and Attachments in Sec.  
740.10(a)).
    (4) Exhibition and demonstration. Commodities or software for 
exhibition or demonstration at trade shows, or to any entity that would 
be eligible to receive the commodities or software under paragraphs (a) 
through (e) of this section, may be exported or reexported under this 
paragraph
    (f). The commodities or software must remain under the ``effective 
control'' of the exporter or reexporter or its private sector agent, 
may not be exhibited or demonstrated at any one location for more than 
30 days and may not be used for more than the minimum extent required 
for effective exhibition or demonstration.
    (5) Containers. Containers that would require a license for export 
or reexport to Cuba but that are necessary for shipment of commodities 
being exported to Cuba under a license or license exception may be 
exported or reexported to Cuba. However, this paragraph (f) does not 
authorize the export of the container's contents, which, if not exempt 
from licensing, must be separately authorized for export or reexport 
under either a license or a license exception.

PART 746--[AMENDED]

0
6. The authority citation for 15 CFR part 746 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. 287c; Sec 1503, Pub. L. 108-11, 117 Stat. 559; 22 U.S.C. 
6004; 22 U.S.C. 7201 et seq.; 22 U.S.C. 7210; E.O. 12854, 58 FR 
36587, 3 CFR, 1993 Comp., p. 614; E.O. 12918, 59 FR 28205, 3 CFR, 
1994 Comp., p. 899; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 
783; E.O. 13338, 69 FR 26751, 3 CFR, 2004 Comp., p 168; Presidential 
Determination 2003-23 of May 7, 2003, 68 FR 26459, May 16, 2003; 
Presidential Determination 2007-7 of December 7, 2006, 72 FR 1899 
(January 16, 2007); Notice of May 6, 2015, 80 FR 26815 (May 8, 
2015); Notice of August 7, 2015, 80 FR 48233 (August 11, 2015).


0
7. Section 746.2 is amended by revising paragraphs (a) introductory 
text and (a)(1)(x) and adding paragraphs (a)(2) and (b)(6) to read as 
follows:


Sec.  746.2  Cuba.

    (a) License requirements. As authorized by section 6 of the Export 
Administration Act of 1979, as amended (EAA) and by the Trading with 
the Enemy Act of 1917, as amended, you will need a license to export or 
reexport all items subject to the EAR (see part 734 of the EAR for the 
scope of items subject to the EAR) to Cuba, including any release of 
technology or source code subject to the EAR to a Cuban national, 
except as follows:
    (1) * * *
    (x) Aircraft, vessels and spacecraft (AVS) for certain aircraft on 
temporary sojourn; equipment and spare parts for permanent use on a 
vessel or aircraft, and ship and plane stores; or vessels on temporary 
sojourn (see Sec.  740.15(a), (b), and (d) of the EAR).
* * * * *
    (2) Deemed exports and deemed reexports. A license is not required 
to release technology or source code subject to the EAR but not on the 
Commerce Control List (i.e., EAR99 technology or source code) to a 
Cuban national in the United States or a third country.
    (b) * * *
    (6) License applications for exports or reexports of items to 
ensure safety in civil aviation, including the safe operation of 
commercial passenger aircraft will be considered on a case-by-case 
basis.
* * * * *

PART 772--[AMENDED]

0
8. The authority citation for 15 CFR part 772 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, 2015, 80 FR 48233 (August 11, 2015).


0
9. In Sec.  772.1, the definition of ``U.S. Person'' is amended by 
revising paragraphs (a) introductory text and (b) to read as follows.


Sec.  772.1  Definitions of terms as used in the Export Administration 
Regulations (EAR).

* * * * *
    U.S. Person. (a) For purposes of Sec. Sec.  740.21(e)(1), 744.6, 
744.10, 744.11, 744.12, 744.13, and 744.14 of the EAR, the term U.S. 
person includes:
* * * * *
    (b) See also Sec. Sec.  740.9, 740.14, and 740.21(f)(2) and parts 
746 and 760 of the EAR for definitions of ``U.S. person'' that are 
specific to those sections and parts.
* * * * *

    Dated: September 14, 2015.
Kevin J. Wolf,
Assistant Secretary for Export Administration.
[FR Doc. 2015-23495 Filed 9-18-15; 8:45 am]
 BILLING CODE 3510-33-P


