Japan Machinery Center for Trade and Investment
Japan Machinery Center for Trade and Investment

No.401 Kikai Shinko Building

Tel :81-3-3431-9507

5-8, Shibakoen 3-chome,

Fax:81-3-3436-6455

Minato-ku, Tokyo 105-0011
JapanJuly 6, 2015
Bureau of Industry and Security
Department of CommerceRe:

Comments in response to the Advanced notice of proposed rulemaking
Identification Number BIS-2015-0012, RIN 0694-AG51
Additional Improvements and Harmonization of Export Clearance Provisions

The Japan Machinery Center for Trade and Investment (“JMC”) is a non-profit industry
organization consisting of 250 firms that manufacture and export machinery products
worldwide. JMC understands the significance of export controls in the global trade, and JMC
has assisted its member companies to comply not only with the Japan’s export control
regulations but also with the U.S. reexport regulations. Therefore, JMC is concerned very muchwith the advanced notice of proposed rulemaking (“ANPR”) published in the Federal Registeron May 22, 2015 in association with the extraterritorial application of the reexport regulations
and hereby submit our comments.

1. Points which could make impacts on the foreign importers and Our understandings
The proposals in paragraphs A and C of the ANPR indicate the points which could make
impacts on the foreign importers.
Bureau of Industry and Security, Commerce Department (“BIS”) stated in the paragraph A that
BIS is considering requiring that the ECCN be identified for all items on the Commerce Control
List, and also stated in the paragraph C that this proposed revision would require that the license
number, license exception code, or no license required designation be entered on the export
control documents.
Summing up the paragraph A and C, we understand what BIS is considering in the ANPR asfollows; For the purpose of ensuring consignees’ awareness of their involvement in a1

Japan Machinery Center for Trade and Investment

transaction of the controlled items, BIS is considering requiring that for all itemson the Commerce Control List, ECCN, license number, license exception code or
no license required designation be entered on the export control document
including the commercial invoice and contractual documentation.

2. Support for the requirements of the Paragraphs A and C
If our understandings mentioned above can be deemed correct, we are pleased to support therequirements described in the paragraphs A and C for following reason;
 While ECCN is indispensable information for the foreign importers in ensuring
compliance with the reexport regulations, Japanese importers have so often facedwith the problems that ECCN is not furnished smoothly from the U.S. exporters.
For this purpose we requested BIS in the past to make it mandatory for the U.S.
exporters to furnish the foreign importers with ECCN. If the requirements of theparagraphs A and C would be reflected in the final rule, it could solve this kind ofproblem and help the Japanese importers effectively comply with the reexport
regulations.

3. Conditions for reinforcing our support for the requirements of the Paragraphs A and C.
We strongly wish BIS to take followings into account in case that the requirements of theparagraph A and C could cause the foreign importers unexpected burden; The foreign importers may place reasonable reliance on the ECCN furnishedby the U.S. exporters unless the consignee knows that the ECCN is in error.
In page 35282 of Federal Register, June 16, 2011 on “Export Control Reform
Initiative: Strategic Trade Authorization License Exception”, BIS statedresponding to the Comment 24 that the consignee may rely on the ECCN provided
to it by the party required to furnish the ECCN to the consignee unless theconsignee ‘‘knows’’ that the ECCN is in error. We wish this comprehension will
be applied to the requirements of the paragraph A and C.

4. Our additional request
Hopefully the countries listed in all of the country groups A1 to A4 of supplement No.1 to part740 of the EAR should be exempted from the extraterritorial application of the reexport
regulations because those countries including Japan have fulfilled stringent export controls at2

Japan Machinery Center for Trade and Investment

same level as the U.S. in accordance with the multilateral export control regimes, namely theWassenaar Arrangement, the Missile Technology Control Regime, the Australia Group, and theNuclear Suppliers Group.
The reexport regulations have imposed additional and duplicative costs on the Japaneseindustries because they must comply with both Japan’s national export control regulations andthe US regulations. The additional costs account for a significant share of a company’s totalcompliance costs.

Finally we would like to thank BIS for giving us an opportunity to submit comments and taking
our comments into account.
Please accept my best regards,

Shozo Hirata
ChairmanCommittee on Security Export Controls
Japan Machinery Center for Trade and Industry
Contact information
Koji Hashimoto
Secretariat at JMC
Phone +81-3-3431-9800
Email hashimoto@jmcti.or.jp

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