[Federal Register Volume 86, Number 191 (Wednesday, October 6, 2021)]
[Rules and Regulations]
[Pages 55492-55494]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-21509]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR Part 774

[Docket No. 210923-0195]
RIN 0694-AI44


Control of Deuterium That Is Intended for Use Other Than in a 
Nuclear Reactor Under the Export Administration Regulations (EAR)

AGENCY: Bureau of Industry and Security, Department of Commerce.

ACTION: Final rule.

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SUMMARY: The Department of Commerce is publishing this final rule in 
conjunction with a U.S. Nuclear Regulatory Commission (NRC) final rule 
to revise its regulations to remove the NRC's licensing authority for 
exports of deuterium for non-nuclear end use. The responsibility for 
the licensing of exports of deuterium for non-nuclear end use is being 
transferred to the Department of Commerce's Bureau of Industry and 
Security (BIS). BIS is publishing this final rule to include deuterium 
under its export licensing jurisdiction under the Export Administration 
Regulations (EAR). This Commerce final rule describes the changes made 
to the EAR to control the deuterium moved from the export control 
authority of the NRC to the export control authority of BIS under the 
EAR. Exports of deuterium for nuclear end use will remain under the 
NRC's export licensing jurisdiction.

DATES: This rule is effective December 6, 2021.

FOR FURTHER INFORMATION CONTACT: Steven Clagett, Office of 
Nonproliferation Controls and Treaty Compliance, Nuclear and Missile 
Technology Controls Division, tel. (202) 482-1641 or email 
steven.clagett@bis.doc.gov.

SUPPLEMENTARY INFORMATION:

Background

    The Department of Commerce is publishing this final rule in 
conjunction with a U.S. Nuclear Regulatory Commission (NRC) final rule 
being published in this issue of the Federal Register to revise its 
regulations to remove the NRC's licensing authority for exports of 
deuterium for non-nuclear end use. The responsibility for the licensing 
of exports of deuterium for non-nuclear end use is being transferred to 
the Department of Commerce's Bureau of Industry and Security (BIS). BIS 
is publishing this final rule to include deuterium under its export 
licensing jurisdiction under the Export Administration Regulations 
(EAR). This Commerce final rule describes the changes made to the EAR 
to control the deuterium moved from the export control authority of the 
NRC to the export control authority of BIS under the EAR. Exports of 
deuterium for nuclear end use will remain under the NRC's export 
licensing jurisdiction.

Deuterium Under NRC and Its Evolution Into Broader Commercial Use

    Section 109 of the Atomic Energy Act of 1954 (AEA), as amended by 
the Nuclear Non-Proliferation Act of 1978 (NNPA), authorizes and 
directs the NRC, after consultation with the Secretaries of State, 
Energy, and Commerce, to exercise its export licensing authority over 
``items or substances'' determined by the Commission to be ``especially 
relevant from the standpoint of export control because of their 
significance for nuclear explosive purposes'' (42 U.S.C. 2139(b)). 
Since 1978, under this authority, the NRC has exercised jurisdiction 
over all exports of deuterium, including heavy water, as well as 
deuterium gas and other deuterated compounds for both nuclear and non-
nuclear end uses. In the early years of the nuclear energy industry, 
deuterium oxide (heavy water) was largely produced for use in nuclear 
reactors. High-purity reactor grade heavy water, which has a deuterium 
concentration of 99.75 percent or greater, has been used to operate 
reactors with natural uranium.
    In the last decade, the market for deuterium has significantly 
expanded and evolved beyond nuclear reactor use. Non-nuclear use of 
deuterium includes but is not limited to production of: Advanced 
electronics, deuterated solvents, deuterated pharmaceuticals, hydrogen 
arc-lamps, neutron generators, and tracers in hydrological, biological, 
and medical studies.
    Despite this market change, the NRC has continued to control all 
exports of deuterium under the general or specific export licensing 
provisions in 10 CFR part 110. The NRC has determined, in consultation 
with the Executive Branch, that it is appropriate to revise its 
regulations and transfer the export licensing control of non-nuclear 
end uses of deuterium to the Department of Commerce, as was done for 
the non-nuclear end uses of nuclear graphite in 2005 (70 FR 41937; July 
21, 2005).
    Over the past 10 years, the quantity of deuterium exported for non-
nuclear end use has steadily increased. A growing number of companies 
have been required to obtain specific licenses to export deuterium for 
non-nuclear use because the quantity exceeded the general license 
quantity thresholds. As stated in the NRC final rule published in this 
edition of the Federal Register in conjunction with this Commerce final 
rule, the NRC's recent licensing experience has shown that deuterium 
has been exported almost exclusively for non-nuclear industrial and 
research end uses, prompting the reevaluation of NRC licensing 
requirements concerning these non-nuclear end use exports. Other 
supplier nations have export controls over deuterium but have limited 
them to cover exports ``for use in a nuclear reactor.'' This limitation 
appears in both the Nuclear Non-Proliferation Treaty Exporters 
Committee (Zangger Committee) and the Nuclear Suppliers Group (NSG) 
clarifications of items on the Trigger List. The United States is a 
member of the Zangger Committee and a Participating Government of the 
NSG.
    As stated in the NRC final rule published in conjunction with this 
Commerce final rule, the history of the use of deuterium exported under 
the NRC's authority indicates that deuterium has not been diverted for 
known illicit purposes to produce weapons-grade material or for use in 
unsafeguarded nuclear activities. To the extent that any risk of 
diversion may exist, exports of deuterium for non-nuclear end use will 
continue to be controlled by the Department of Commerce under the EAR, 
and appropriate control mechanisms exist within national regulatory 
authorities and the international community to detect efforts to divert 
deuterium for known illicit purposes. Exports and reexports of 
deuterium for non-nuclear end use will be controlled for Nuclear 
Proliferation (NP) Column 2 under the EAR. A license will be required 
for all destinations controlled for NP 2 reasons, which means an 
authorization (a BIS license or license exception) will be required 
under the EAR for exports and reexports to these destinations. In

[[Page 55493]]

addition, the end-use and end-user controls under part 744 of the EAR 
will impose restrictive license requirements for exports, reexports, 
and transfers (in-country) involving end uses and end users that would 
be contrary to U.S. export control interests, e.g., under Sec.  744.2 
(Restrictions on certain nuclear end uses), Sec.  744.6 (Restrictions 
on certain activities of U.S. persons), and to entities of concern 
(e.g., Entity List and Denied Persons List). The U.S. NRC took this 
robust control structure under the EAR into account when determining 
that appropriate destination, end-user, and end-use based controls will 
be in place to appropriately control the deuterium for non-nuclear end 
use. The following section describes the changes made to the EAR to 
control the deuterium moved from the export control authority of the 
NRC to the export control authority of BIS under the EAR.

Amendments to the Export Administration Regulations (EAR)

    This final rule revises the heading, the License Requirement Note, 
and the Related Controls paragraph, Related Definitions paragraph and 
the Items paragraph in the List of Items Controlled section to control 
deuterium under ECCN 1C298 as described below. The deuterium added to 
ECCN 1C298 will be controlled for the same reason and have the same 
license exception eligibility as the graphite controlled under 1C298, 
so no changes are made to the Reasons for Control paragraph in the 
License Requirements section and License Exceptions section. The 
deuterium, as referenced above, will be controlled for NP Column 2, and 
License Exceptions LVS, and GBS will not be available.
    This final rule revises the heading of ECCN 1C298 by adding the 
term deuterium in addition to the graphite that is already controlled 
under 1C298. Both graphite and deuterium will be controlled under ECCN 
1C298 when the graphite or deuterium is intended for use other than in 
a nuclear reactor and meets the additional control parameters under 
Items paragraphs .a or .b of 1C298. Because this final rule is adding 
Items paragraphs .a and .b in the List of Items Controlled section to 
further describe the graphite and deuterium controlled under ECCN 
1C298, this final rule removes the control text from the heading that 
described what graphite was controlled under the ECCN prior to this 
final rule being published. This removed control text from the heading 
is being added as new items paragraph .a under 1C298.
    This final rule revises License Requirement Note to ECCN 1C298 to 
make one conforming change. This final rule adds the term `deuterium' 
to specify that all graphite and deuterium, as defined in ECCN 1C298, 
intended for use in a nuclear reactor is subject to the export 
licensing authority of the NRC.
    This final rule adds a Related Controls paragraph (3) in the List 
of Items Controlled section of ECCN 1C298 to provide greater detail on 
the deuterium, including any deuterium compound, that, when intended 
for use in a nuclear reactor, is subject to the export licensing 
authority of the NRC.
    This final rule adds a new Related Definition for Deuterium in the 
List of Items Controlled section of ECCN 1C298. This ECCN-specific 
definition specifies `Deuterium' means deuterium and any deuterium 
compound, including heavy water, in which the ratio of deuterium atoms 
to hydrogen atoms exceeds 1:5000.
    Lastly, this final rule revises the Items paragraph in the List of 
Items Controlled section to add Items paragraphs .a and .b. This final 
rule adds Items paragraph .a to identify the graphite controlled under 
ECCN 1C298. As referenced above, this is the same control parameter 
text that was previously in the heading, but is now being moved to 
items paragraph .a under ECCN 1C298. This final rule adds Items 
paragraph .b to identify the `deuterium,' including any deuterium 
compound, including heavy water that when it meets the control 
parameter text of this paragraph .b will be controlled under ECCN 
1C298. Specifically, `deuterium' not for use in a nuclear reactor will 
be controlled under ECCN 1C298.

Export Control Reform Act of 2018

    On August 13, 2018, the President signed into law the John S. 
McCain National Defense Authorization Act for Fiscal Year 2019, which 
included the Export Control Reform Act of 2018 (ECRA) (codified, as 
amended, at 50 U.S.C. Sections 4801-4852). ECRA provides the legal 
basis for BIS's principal authorities and serves as the authority under 
which BIS issues this rule.

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 final rule has been designated a ``significant 
regulatory action,'' although not economically significant, under 
section 3(f) of Executive Order 12866. Commerce estimates that this 
rule will result in a minimal increase to the number of license 
requests submitted to BIS annually.
    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 Office of Management and Budget (OMB) Control Number.
    This rule involves the following OMB-approved collections of 
information subject to the PRA: 0694-0088, ``Multi-Purpose 
Application,'' which carries a burden hour estimate of 29.6 minutes for 
a manual or electronic submission; 0694-0096 ``Five Year Records 
Retention Period,'' which carries a burden hour estimate of less than 1 
minute; and 0607-0152 ``Automated Export System (AES) Program,'' which 
carries a burden hour estimate of 3 minutes per electronic submission. 
This rule changes the respondent burden by increasing the estimated 
number of submissions by 20. Specifically, BIS estimates that this 
control of deuterium under the EAR will result in an increase of twenty 
license applications submitted annually to BIS. The additional burden 
falls within the estimated burden approved by OMB for the following 
information collections: 0694-0088, 0694-0096, and 0607-0152.
    Any comments regarding these collections of information, including 
suggestions for reducing the burden, may be submitted online at https://www.reginfo.gov/public/do/PRAMain. The particular information 
collection may be found by using the search function and entering 
either the title of the collection or the OMB Control Number.
    3. This rule does not contain policies with Federalism implications 
as that term is defined in Executive Order 13132.
    4. Pursuant to section 1762 of the Export Control Reform Act of 
2018 (50 U.S.C. 4801-4852), this action is exempt from the 
Administrative Procedure Act (5 U.S.C. 553) requirements for notice of 
proposed rulemaking, opportunity for public participation, and delay in 
effective date.
    5. Because a notice of proposed rulemaking and an opportunity for

[[Page 55494]]

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.

List of Subjects in 15 CFR Part 774

    Exports, Reporting and recordkeeping requirements.

    For the reasons stated in the preamble, part 774 of the Export 
Administration Regulations (15 CFR parts 730-774) is amended as 
follows:

PART 774--THE COMMERCE CONTROL LIST

0
1. The authority citation for 15 CFR part 774 continues to read as 
follows:

    Authority:  50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.; 50 
U.S.C. 1701 et seq.; 10 U.S.C. 8720; 10 U.S.C. 8730(e); 22 U.S.C. 
287c, 22 U.S.C. 3201 et seq.; 22 U.S.C. 6004; 42 U.S.C. 2139a; 15 
U.S.C. 1824; 50 U.S.C. 4305; 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.


0
2. In Supplement No. 1 to part 774, Category 1, revise Export Control 
Classification Number (ECCN) 1C298 to read as follows:

* * * * *
1C298 Graphite and deuterium that is intended for use other than in 
a nuclear reactor, as follows (see List of Items Controlled).

License Requirements

Reason for Control: NP

 
                                            Country chart (see Supp. No.
                Control(s)                         1 to part 738)
 
NP applies to entire entry................  NP Column 2.
 

License Requirement Note: The graphite and deuterium, as defined in 
this entry, when intended for use in a nuclear reactor, is subject 
to the export licensing authority of the Nuclear Regulatory 
Commission (see 10 CFR part 110).

List Based License Exceptions (See Part 740 for a description of all 
license exceptions)

LVS: N/A
GBS: N/A

List of Items Controlled

Related Controls: (1) See also 1C107. (2) Graphite having a purity 
level of less than 5 parts per million ``boron equivalent'' as 
measured according to ASTM standard C-1233-98 and intended for use 
in a nuclear reactor is subject to the export licensing authority of 
the Nuclear Regulatory Commission (see 10 CFR part 110). (3) 
Deuterium and any deuterium compound, including heavy water, in 
which the ratio of deuterium atoms to hydrogen atoms exceeds 1:5000; 
and intended for use in a nuclear reactor is subject to the export 
licensing authority of the Nuclear Regulatory Commission (see 10 CFR 
part 110).
Related Definitions: For the purpose of this entry, graphite with a 
purity level better than 5 parts per million boron equivalent is 
determined according to ASTM standard C1233-98. In applying ASTM 
standard C1233-98, the boron equivalence of the element carbon is 
not included in the boron equivalence calculation, since carbon is 
not considered an impurity. For the purpose of this entry, 
`Deuterium' means deuterium and any deuterium compound, including 
heavy water, in which the ratio of deuterium atoms to hydrogen atoms 
exceeds 1:5000.
Items:

    a. Graphite with a boron content of less than 5 parts per 
million and a density greater than 1.5 grams per cubic centimeter 
that is intended for use other than in a nuclear reactor;
    b. `Deuterium' not for use in a nuclear reactor.

* * * * *

Matthew S. Borman,
Deputy Assistant Secretary for Export Administration.
[FR Doc. 2021-21509 Filed 10-5-21; 8:45 am]
BILLING CODE 3510-33-P


