BIS and DDTC Propose Changes to Category XII

As with previous ECR proposed rules, both BIS and DDTC request comments from the public for consideration prior to finalizing the rules. The deadline to submit comments is July 6, 2015.

Like other USML categories that have already undergone reform, the proposed rules create a positive list of items controlled under Category XII, including removal of the “catch all” parts and components subcategory. BIS will create “600 Series” Export Control Classification Numbers (ECCNs) on the CCL to capture items that will move off the USML. However, the proposed rules also transfer several USML items to existing ECCNs.

To accommodate most items that will be moved off the USML, the proposed rules create 600 Series ECCNs in CCL Category 6, 6X615, and amend the existing 600 Series in Category 7, 7X611. ECCNs 6X615 will contain military fire control, ranger finder, and optical equipment, and ECCNs 7X611 will include military guidance and control equipment.

Several items transferred from the USML Category XII to the CCL are considered dual use by the Wassenaar Arrangement. As such, the proposed rules do not add them to the 600 Series but rather fit them within existing ECCNs. ECCNs outside of the 600 Series that will be amended include the following commodity ECCNs:

• 0A987, optical sighting devices for firearms
• 2A984, concealed object detection equipment
• 6A004, optical equipment and components;
• 6A005, lasers, components, and optical equipment;
• 6A007, gravity meters and gravity gradiometers;
• 6A008, radar systems, equipment, and assemblies;
• 6A107, gravity meters and gravity gradiometers other than those controlled by 6A007;
• 7A001, accelerometers;
• 7A002, gyros or angular rate sensors;
• 7A003, inertial measurement equipment or systems;
• 7A005, Global Navigation Satellite Systems receiving equipment;
• 7A101, accelerometers; and
• 7A102, gyros other than those controlled by 7A002.

Critically the control parameters for the above listed ECCNs, and their related software and technology ECCNs, will not change. However, other ECCNs proposed for revision will have additional controls added. For example, ECCNs 6A002 and 6A990 will include regional stability control, which will result in an interagency license review for commodities in those ECCNs and a license requirement for all exports or reexports, including to Canada. The proposed rules will restrict the availability of the Strategic Trade Authorization license exception (STA) for certain items in the following ECCNs: 0E987, 6A002, 6A004, 6A990, 6A990, 6D002, 6D003, 6E001, 6E002, 6E990, and the new 6E994. Additionally BIS proposes to amend Section 744.9, the provision restricting exports and reexports of certain cameras, systems or equipment, to expand the ECCNs covered and include a restriction on in-country transfers as well as exports and reexports of the ECCNs specified.

Both BIS and DDTC take the public’s comments very seriously in establishing the final rules. BIS specifically asks for responses related to (1) any potential lack of coverage; (2) items proposed for control on the CCL that are not controlled on the Wassenaar Agreement’s Munitions or Dual Use List; (3) specific examples of control criteria that do not establish a bright line rule between the CCL and USML or the 600 Series and the rest of the CCL; and (4) specific examples of items that are controlled under the revised Category XII, 6X615, or 7X611that are now in normal commercial use and should be controlled elsewhere on the CCL.