Computer Equipment and Technology Export Control Reform Act

SECTION. 1. SHORT TITLE.

    This Act may be cited as the ``Computer Equipment and Technology 
Export Control Reform Act''.

SEC. 2. ANNUAL REVIEW OF CONTROLS ON COMPUTERS.

    Section 4 of the Export Administration Act of 1979 (50 U.S.C. App. 
2403) is amended by adding at the end the following new subsection:
    ``(h) Review of Export Controls on Computer Equipment and 
Technology.--
            ``(1) In general.--In order to ensure that requirements of 
        validated licenses and other licenses authorizing multiple 
        exports are periodically removed as computer equipment, 
        computer communications and networking equipment, computer 
        software, and related technology, that are subject to such 
        requirements become obsolete with respect to the specific 
        objectives of the export controls requiring such licenses, the 
        Secretary shall conduct periodic reviews of such controls. The 
        Secretary shall complete such a review not later than 6 months 
        after the date of the enactment of this subsection, and not 
        later than the end of each 1-year period thereafter.
            ``(2) Review elements.--In conducting each review under 
        paragraph (1), the Secretary shall do the following with 
        respect to the export controls requiring a license described in 
        paragraph (1):
                    ``(A) Objectives of control.--The Secretary shall 
                identify the specific objectives of the export 
                controls, for the 12-month period beginning on the date 
                on which the review is completed, for each country for 
                which a validated license is required. When an 
                objective of an export control is to defer the 
                development of a specific capability in such country, 
                the Secretary shall specify for what period of time the 
                controls are expected to defer such capability.
                    ``(B) Quantity and performance.--The Secretary 
                shall estimate, for the 12-month period described in 
                subparagraph (A), the quantity and performance 
                (measured in Composite Theoretical Performance or other 
                relevant performance metrics) of computer systems that 
                must be obtained by each country for which a validated 
                license is required in order to defeat the objectives 
                of the export controls.
                    ``(C) Availability to controlled destinations.--The 
                Secretary shall evaluate the effectiveness of the 
                export controls in achieving their specific objectives, 
                including explicit descriptions of the availability, 
                during the 12-month period described in subparagraph 
                (A), to controlled countries of computer equipment, 
                computer communications and networking equipment, 
                computer software, and related technology on which the 
                export controls are in effect--
                            ``(i) from sources that do not control the 
                        export of such items, and from sources from 
                        which no effective export controls on such 
                        items exist;
                            ``(ii) as a result of actual or potential 
                        diversion, including potential diversion of 
                        software over international computer or 
                        telephone networks;
                            ``(iii) as a result of export license 
                        authorizations from countries other than the 
                        United States;
                            ``(iv) as a result of indigenous production 
                        in controlled countries; and
                            ``(v) as a result of United States 
                        regulations permitting exports to such 
                        countries of items with minimal United States 
                        content by value.
                    ``(D) Economic impact.--The Secretary shall 
                evaluate the economic impact, during the 12-month 
                period described in subparagraph (A), of the export 
                controls on exporting companies, including estimates of 
                lost sales, loss in market share, and administrative 
                overhead.
            ``(3) Increase in thresholds.--After completing each review 
        under this subsection, the Secretary shall increase, if 
        warranted by the findings of the review, the following export 
        control thresholds, consistent with the obligations of the 
        United States under bilateral and multilateral agreements:
                    ``(A) The performance levels at which computer 
                systems are eligible for delivery under a distribution 
                license.
                    ``(B) The performance levels at which computer 
                systems may be shipped under a general license to 
                countries other than controlled countries.
                    ``(C) The performance levels defining a 
                `supercomputer'.
                    ``(D) The performance levels at which a validated 
                license is required for the export to a controlled 
                country of computer systems and peripherals, software, 
                parts, and communications equipment normally supplied 
                with such computer systems.
        In any recommendation or publication for such increase, the 
        Secretary shall include the specific rationale for the 
        increase.
            ``(4) Default provisions.--If on the date by which a review 
        under this subsection must be completed, the review is not 
        completed or a report on the review has not been transmitted to 
        the Congress under paragraph (5), the performance levels 
        described in paragraph (3) then in effect, stated in terms of 
        Composite Theoretical Performance or other relevant performance 
        metrics, shall double, effective 90 days from that date. No 
        change in regulations or notice in the Federal Register shall 
        be required to implement such increase in performance levels.
            ``(5) Report.--The Secretary shall transmit to the Congress 
        and to the Computer Systems Technical Advisory Committee (or 
        successor technical advisory committee) a report on the 
        findings of each review conducted under this subsection, 
        addressing each requirement set forth in paragraph (2). Within 
        60 days thereafter, the Computer Systems Technical Advisory 
        Committee (or successor technical advisory committee) shall 
        transmit to the Congress a concise statement specifying its 
        concurrence or nonconcurrence with each matter contained in the 
        Secretary's report, along with specific reasons for such 
        concurrence or nonconcurrence.
            ``(6) Hearings.--The Secretary shall conduct public 
        hearings not less than once each year in order to solicit 
        information from all interested parties on all matters to be 
        addressed in each review conducted under this subsection.''.

SEC. 3. DE MINIMIS DECONTROL OF COMPUTER SYSTEMS.

    Section 4 of the Export Administration Act of 1979 is amended by 
adding at the end the following new subsection:
    ``(i) Removal of Controls on Computer Systems Valued at Less Than 
$5,000.--
            ``(1) In general.--No validated license shall be required 
        under this Act for the export or reexport to any controlled 
        country of any digital computer having a net value of less than 
        $5,000.
            ``(2) Definition of net value.--As used in paragraph (1), 
        the `net value' of a digital computer means the actual selling 
        price of the computer, less transport charges, to the customer 
        abroad, or the current market price of the computer to the same 
        type of customer in the United States.
            ``(3) No quantity limit.--No limit may be placed under this 
        Act on the number of computer systems to which paragraph (1) 
        applies that may be exported or reexported at any one time or 
        on the number of shipments of such computer systems to any 
        controlled country or end-user in a controlled country.''

SEC. 4. DECONTROL OF MASS-MARKET COMPUTER EQUIPMENT.

    Section 4 of the Export Administration Act of 1979 is amended by 
adding at the end the following new subsection:
    ``(j) Removal of Controls on Mass-Market Computer Equipment.--
            ``(1) Mass-market computer equipment defined.--For purposes 
        of this subsection, the term `mass-market computer equipment' 
        means any computer system, computer networking equipment, 
        peripheral to a computer system, part or subassembly of a 
        computer system, or combination thereof, on which export 
        controls are in effect under this Act, and which will have been 
        installed for end-use outside the United States in a quantity 
        exceeding 100,000 units over a 12-month period, as determined 
        under paragraph (2).
            ``(2) Anticipatory review of mass-market computer 
        equipment.--Not later than--
                    ``(A) 6 months after the date of the enactment of 
                this subsection, and
                    ``(B) the end of each 1-year period occurring 
                thereafter,
        the Secretary shall, in consultation with the Computer Systems 
        Technical Advisory Committee (or successor technical advisory 
        committee), industry groups, and computer equipment producers, 
        identify those items (including computer systems differentiated 
        in terms of Composite Theoretical Performance) that will be 
        installed for end-use outside the United States in a quantity 
        exceeding 100,000 units during the 12-month period beginning on 
        the applicable date described in subparagraph (A) or (B). 
        Estimates of numbers of items installed shall be based on 
        reliable estimates provided by producers of such items.
            ``(3) Action by the secretary.--Not later than 30 days 
        after an item is determined by the Secretary under paragraph 
        (2) to be mass-market computer equipment, the Secretary shall 
        either--
                    ``(A) eliminate export controls on such equipment 
                and publish a notice of such action in the Federal 
                Register; or
                    ``(B) in the case of an item controlled under the 
                terms of an export control regime in which the United 
                States participates with 1 or more other countries, 
                propose the elimination of controls on such equipment 
                in accordance with the procedures of the appropriate 
                regime and publish a notice of such proposal in the 
                Federal Register.''.

SEC. 5. IDENTIFICATION OF PROLIFERATION END-USERS.

    Section 4 of the Export Administration Act of 1979 is amended by 
adding at the end the following new subsection:
    ``(k) Identification of Proliferation End-users.--
            ``(1) Proliferation end-user defined.--For purposes of this 
        subsection, the term `proliferation end-user' means any entity 
        that is engaged, directly or indirectly, in the design, 
        development, or production of nuclear, chemical, or biological 
        weapons or missiles and is located in a country that is not 
        party to a bilateral or multilateral agreement the purpose of 
        which is to limit the spread of such weapons and activities and 
        to which the United States is a party.
            ``(2) Publication of proliferation end-users.--The 
        Secretary shall, within 10 days after communicating to any 
        United States exporter (including by denying an export license 
        to such exporter) that any entity has been identified as a 
        proliferation end-user, publish in the Federal Register the 
        name and specific validated license requirements for exports to 
        such proliferation end-user. If such publication is not made, 
        such entity shall be deemed not to be a proliferation end-user 
        and exports or reexports to such entity shall not require an 
        individual validated license solely because of activities 
        described in paragraph (1).
            ``(3) Customer screening.--The Secretary shall not require, 
        as a condition of granting any general or validated license for 
        the export of goods or technology to any end-user in a country, 
        that information by the export license applicant be provided 
        regarding activities described in paragraph (1) by such end-
        user, unless--
                    ``(A) the Secretary has identified such country as 
                engaged in the design, development, or production of 
                nuclear, chemical, or biological weapons or missiles; 
                or
                    ``(B) the Secretary has determined that there is a 
                specific risk that the exports will be diverted to a 
                country for use in activities described in subparagraph 
                (A).''.

Summary: Computer Equipment and Technology Export Control Reform Act - Amends the Export Administration Act of 1979 to direct the Secretary of Commerce to: (1) conduct annual reviews of export controls on computer equipment and technology. (2) increase certain export control thresholds if warranted by the review. And (3) report review findings to the Congress and the Computer Systems Technical Advisory Committee. Exempts from license requirements for export or reexport to any controlled country digital computers valued at less than $5,000. Directs the Secretary to: (1) identify specified items that will be installed for end-use outside the United States. And (2) publish in the Federal Register the name and specified license requirements for exports to a proliferation end-user . Prohibits the Secretary from requiring a license applicant to supply information about proliferation-related activities of an end-user, as a condition of granting a license for export of goods or technology to such end-user, unless the Secretary has: (1) identified the end-user's country as engaged in proliferation activities. Or (2) determined there is a specific risk that the exports will be diverted to a country for use in such activities.