# Presentation: 766410

## Libya Licensing

- Presented By
- Bureau of Industry and Security
- U.S. Department of Commerce

## Overview

**Background***** ***
**August 31, 2006 Regulation**
**Moving Forward**

## Libya: Background

- In August 2003, Libya satisfied the United Nations Security Council (UNSC) requirements related to the 1988 bombing of Pan Am Flight 103 over Scotland.
- In September 2003, the UNSC issued Resolution 1506 which lifted the already suspended UN embargo on Libya.
- In December 2003, Libya announced that it would end its WMD programs.
- In recognition of the steps Libya had taken with regard to its weapons program and support of terrorism, in April 2004, the President terminated the application of the Iran-Libya Sanctions Act with respect to Libya.
- The President’s action allowed the resumption of most commercial activities with Libya.

## Libya: Background #2

- On April 29, 2004, BIS published a regulation returning licensing jurisdiction for Libya to BIS.
- On March 22, 2005, BIS published a second regulation on Libya that dealt with the “installed base” issue (General Prohibition 10 in 736.2 of the EAR).
- The March 2005 regulation allows exporters to overcome the prohibition against dealing with installed base.

## Libya Background #3

- On May 15, 2006 the Secretary of State announced the Administration’s intent to rescind Libya’s designation as a state sponsor of terrorism.
- This decision became effective on June 30, 2006 following a mandated 45-day Congressional notification period.
- Following the May announcement, all relevant agencies engaged in discussions on what the new export control regime for Libya should be in light of the Secretary of State’s action.  The new regulation is a result of those negotiations.

## Libya: The August 31, 2006 Regulation

- The regulation removes the licensing requirement for all items controlled for AT reasons only.
- Libya is removed from Country Group E:1 and moved into Country Group D:1.  It remains in Country Groups D:2, D:3, and D:4.
- This makes Libya eligible, in whole or in part, for these License Exceptions:  CIV, APP, TMP, RPL, GOV, TSU, BAG, AVS, APR, ENC and KMI.

## New Licensing Requirements & Review Policy

- Items controlled for multilateral reasons – chemical/biological (CB), nuclear non-proliferation (NP), national security (NS), and missile technology (MT), still require a license for export or reexport to Libya.
- Items controlled unilaterally for regional stability (RS) and crime control (CC) reasons also still require licenses for export or reexport to Libya.
- Applications for these items are reviewed on a case-by-case basis consistent with the relevant sections in Part 742.

## Treatment of Installed Base

- Although installed base is a universal issue, there are procedures that are unique to Libya.
- Libya was under a comprehensive embargo from January 1986 through April 2004.  During that time many U.S.-origin items were illegally shipped to Libya and are considered installed base.
- Restrictions on exports of dual-use items to Libya began in 1979, so it is possible that there are items shipped prior to January 1986 which would also be installed base.

## Treatment of Installed Base

- It is a violation of the EAR under Section 764.2(e) and General Prohibition 10 to interact with installed base items.
- In March 2005, BIS published a regulation that allows exporters to overcome this prohibition in Libya.  This was added as Section 764.7 in the EAR.
- This procedure remains in the regulations and the August 31, 2006 regulation does not affect it.

## Treatment of Installed Base

- Per Section 764.7 of the EAR, exporters can overcome the prohibition on interacting with installed base items through:
- A report (for items controlled on the Wassenaar Basic List or below); or
- A license (for items controlled on the Wassenaar Sensitive or Very Sensitive Lists or other control regimes).

## Treatment of Installed Base

- The reports are submitted to the Office of Export Enforcement.
- Section 764.7 only applies to installed base items exported illegally prior to April 29, 2004.  Any item exported illegally after that date must be handled like an illegal export to any other destination.

## Moving Forward

- What will BIS licensing volume be for Libya?
- The answer is that it is difficult to say.
- From January 2005-July 2006, 98% of all licenses granted for Libya were for AT-only items ($4.51 of $4.6 billion).  Applications for these items will all go away.
- In addition, some of the regime-controlled items exported to Libya will now be eligible for License Exceptions.
- However, it is possible that more U.S. companies will seek to do business in Libya now that it is no longer terrorist-designated resulting in more licenses for regime-controlled items.

## Contact Information	http://www.bis.doc.gov 

**U.S. Embassy Tripoli Commercial Section: **
- _[http://tripoli.usmission.gov](http://tripoli.usmission.gov/)_** **
- _[tripoliecon@state.gov](mailto:tripoliecon@state.gov)_
** *****218-21-335-1846***
**BIS Office of Exporter Services:**
- (202) 482-4811
*For general information and assistance*
*http://www.bis.doc.gov/seminarsandtraining/index.htm*
**BIS/NPTC/FP**
- (202) 482-4252
*For information on BIS’s foreign policy controls*