U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

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89–011 2001

107th Congress, 1st Session – – – – – – – – – – – – – House Document 107–38

PERIODIC REPORT ON THE NATIONAL EMERGENCY

CAUSED BY THE LAPSE OF THE EXPORT ADMINISTRATION ACT OF 1979 FOR AUGUST 19, 2000 TO NOVEMBER 13, 2000

COMMUNICATION

FROM

THE PRESIDENT OF THE UNITED STATES

TRANSMITTING

THE FINAL REPORT ON THE NATIONAL EMERGENCY DECLARED

BY EXECUTIVE ORDER 12924 OF AUGUST 19, 1994, TO DEAL

WITH THE THREAT TO THE NATIONAL SECURITY, FOREIGN POLICY, AND ECONOMY OF THE UNITED STATES CAUSED BY THE

LAPSE OF THE EXPORT ADMINISTRATION ACT OF 1979, PURSUANT TO 50 U.S.C. 1641(c)

FEBRUARY 6, 2001.—Referred to the Committee on International Relations

and ordered to be printed

(1)

THE WHITE HOUSE,

Washington, February 1, 2001.

Hon. J. DENNIS HASTERT,

Speaker of the House of Representatives,

Washington, DC.

DEAR MR. SPEAKER: As required by section 204(c) of the International Emergency Economic Powers Act (50 U.S.C. 1703(c)) and

section 401(c) of the National Emergencies Act (50 U.S.C. 1641(c)),

I transmit herewith the final report on the national emergency declared by Executive Order 12924 of August 19, 1994, to deal with

the threat to the national security, foreign policy, and economy of

the United States caused by the lapse of the Export Administration

Act of 1979.

Sincerely,

GEORGE BUSH.

(3)

PRESIDENT’S PERIODIC REPORT ON THE NATIONAL EMERGENCY

CAUSED BY THE LAPSE OF THE EXPORT ADMINISTRATION ACT OF

1979—FOR AUGUST 19, 2000 TO NOVEMBER 13, 2000

On August 19, 1994 former President Clinton issued Executive

Order No. 12924, declaring a national emergency under the International Emergency Economic Powers Act (IEEPA) (50 U.S.C. 1701

et seq.) to address the threat to the national security, foreign policy,

and economy of the United States caused by the lapse of the Export

Administration Act of 1979, as amended (50 U.S.C. App. 2401 et

seq.) (EAA) and the system of controls maintained under that Act.

In Executive Order No. 12924, he continued in effect, to the extent

permitted by law, the provisions of the Export Administration Act

of 1979, as amended, the Export Administration Regulations (15

CFR 730 et seq.), and the delegations of authority set forth in Executive Order No. 12002 of July 7, 1977 (as amended by Executive

Order No. 12755 of March 12, 1991), Executive Order No. 12214 of

May 2, 1980, Executive Order No. 12735 of November 16, 1990

(subsequently revoked by Executive Order No. 12938 of November

14, 1994), and Executive Order No. 12851 of June 11, 1993. As required by the National Emergencies Act (50 U.S.C. 1622(d)), former

President Clinton issued notices on August 15, 1995, August 14,

1996, August 13, 1997, August 13, 1998, August 10, 1999, and August 3, 2000, continuing the emergency declared in Executive

Order No. 12924.

In 1996, then President Clinton issued two Executive Orders concerning the transfer of items from the United States Munitions List

to the Commerce Control List. On October 12, 1996, he issued Executive Order No. 13020 (regarding hot-section technologies for

commercial aircraft engines) and on November 15, 1996, then

President Clinton issued Executive Order No. 13026 (regarding

encryption products). On December 5, 1995, he issued Executive

Order No. 12981 setting forth the application review process. On

March 31, 1999, he issued Executive Order No. 13117 deleting the

reference to Arms Control and Disarmament Agency (ACDA).

Then President Clinton issued Executive Order No. 12924 pursuant to the authority vested in him as President by the Constitution

and laws of the United States, including, but not limited to,

IEEPA. At that time, he also submitted a report to the Congress

pursuant to section 204(b) of IEEPA (50 U.S.C. 1703(b)). Section

204 of IEEPA requires follow-up reports, with respect to actions or

changes, to be submitted every six months. Additionally, section

401(c) of the National Emergencies Act (50 U.S.C. 1641(c)) requires

that the President, within 90 days after the end of each six-month

period following a declaration of a national emergency, report to

the Congress on the total expenditures directly attributable to that

declaration. To comply with these requirements, then President

Clinton submitted combined activities and expenditure reports for

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the six-month periods ending February 19, 1995, August 19, 1995,

February 19, 1996, August 19, 1996, February 19, 1997, August 19,

1997, February 19, 1998, August 19, 1998, February 19, 1999, August 19, 1999, and February 19, 2000 and August 19, 2000.

On November 13, 2000, then President Clinton signed into law

H.R. 5239 providing for the extension of the EAA until August 20,

2001 (P.L. 106–508).

The following report, submitted pursuant to section 204 of

IEEPA and section 401(c) of the National Emergencies Act, provides information on the activities and expenditures during the

final three-month period, from August 19, 2000 to November 13,

2000 of the national emergency former President Clinton declared

in Executive Order No. 12924. Detailed information on export control activities is contained in the most recent Export Administration Annual Report for Fiscal year 2000 and the January 2001 Report on Foreign Policy Export Controls, required by section 14 and

section 6(f) of the Export Administration Act, respectively.

Following the issuance of Executive Order No. 12924, the Department of Commerce continued to administer and enforce the

system of export controls, including anti-boycott provisions, contained in the Export Administration Regulations (EAR). In administering these controls, the Department acted under a policy of conforming actions under Executive Orders No. 12924, 13020, 13026,

12981, and 13117 to the provisions of the Export Administration

Act, insofar as appropriate.

The expenses incurred by the Federal Government in the threemonth period from August 19, 2000 to November 13, 2000 that are

directly attributable to the exercise of authorities conferred by the

declaration of a national emergency with respect to export controls

were largely centered in the Department of Commerce, Bureau of

Export Administration (BXA). Expenditures by the Department of

Commerce for the reporting period are anticipated to be

$9,286,000, most of which represents program operating costs,

wage and salary costs for Federal personnel, and overhead expenses.

Since the last report to the Congress, there have been several

significant developments in the area of export controls:

A. MULTILATERAL DEVELOPMENTS

Wassenaar Arrangement. The Wassenaar Arrangement on Export

Controls is a multilateral regime consisting of 33 member countries. Its purpose is to contribute to regional and international security and stability by promoting transparency and greater responsibility in international transfers of conventional arms and dualuse goods and technologies.

• The United States Government has participated in submissions of export data made by member countries in the regime since

the November 1996 implementation of the Wassenaar dual-use export control list. The Wassenaar members make dual-use data submissions on a semi-annual basis in April and October.

• The Wassenaar Arrangement continues annual reviews of its

control lists. In April and September 2000, BXA representatives attended Experts Group meetings to review the Wassenaar Arrangement’s controls on conventional arms and dual-use goods and techVerDate 11-MAY-2000 13:13 Feb 07, 2001 Jkt 089006 PO 00000 Frm 00006 Fmt 6601 Sfmt 6601 E:\HR\OC\HD038.XXX pfrm04 PsN: HD038
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nologies. Nearly 70 proposals were discussed to modify and streamline Wassenaar’s Dual-Use and Munitions Lists, approximately 30

of which were submitted by the United States. The majority of the

proposals were in the areas of electronics, computers, sensors, and

machine tools. Nearly all proposals discussed during the April

meeting required additional study by member countries. During

the September Experts Group meeting, agreement was reached on

a number of proposals for liberalizations in the area of electronics.

However, no agreement was reached on proposals regarding controls on microprocessors and computers. In an attempt to try to resolve the differences in control levels for computers and microprocessors, an extraordinary meeting was held in December. • In May and October 2000, BXA representatives participated in

the Arrangement’s General Working Group meetings designed to

increase the general information exchange regarding regions and

projects of concern to the United States (e.g., Sudan, Ethiopia and

Eritrea). The group discussed the specific information exchange on

dual-use goods and technologies and the scope of dual-use notifications and procedures associated with cases requiring ‘‘extreme vigilance.’’ The group agreed to adopt a ‘‘best practices’’ procedure for

exercising extreme vigilance for Very Sensitive List items and to

establish criteria for effective enforcement. Member countries are

still studying U.S. proposals for expanding reporting of conventional arms exports, strengthening dual-use export notification procedures by establishing a denial consultation procedure, and implementing controls on man-portable defense systems (MANPADS).

The United States is continuing to work with interested countries

to bridge the gap between dual-use items and arms in order to increase transparency and reduce differences in licensing practices.

Missile Technology Control Regime (MTCR). The MTCR is a

group of 32 countries that have agreed to coordinate their national

export controls for the prevention of missile proliferation. Each

member, under its own laws and practices, has committed to adhere to the MTCR Guidelines for export licensing policy for items

found on the MTCR Equipment and Technology Annex.

• The MTCR held its annual Reinforced Point-of-Contact Meeting September 9–13 in Paris, France. The agenda was dominated

by the proposed Global Action Plan (GAP) against missile proliferation, a proposal that would encourage MTCR members and nonmembers alike to agree to an international missile nonproliferation

code of conduct.

• The MTCR Plenary and associated Technical Experts Meeting

(TEM) was held October 9–13 in Helsinki, Finland. The outline of

the Global Action Plan to limit missile proliferation was established at the Plenary. Discussions on the specifics of the GAP will

continue in future MTCR sessions. At the TEM, while some

progress was made, final agreement could not be reached on measures to modify control parameters on certain missile-related items,

and differing views also remained on how to define missile range

and payload parameters. Participants agreed to continue to meet

on these issues early this year.

Nuclear Suppliers Group. The Nuclear Suppliers Group (NSG),

composed of 38 member countries with the European Commission

as a permanent observer, is a group of nations concerned with the

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proliferation of nuclear weapons. The NSG has established guidelines to assist member nations in administering national nuclear

export control programs. Controls are focused on certain categories

of goods: nuclear material, equipment and technology unique to the

nuclear industry, and so-called nuclear dual-use items that have

both nuclear and non-nuclear applications.

• The NSG Implementation Working Group, the Transparency

Working Group, and the Dual Use Regime met in Vienna, Austria

the week of October 16.

The Implementation Working Group worked on a proposal to administratively combine the two branches of the NSG—the ‘‘trigger

list’’ items under the jurisdiction of the Nuclear Regulatory Commission and the ‘‘dual-use’’ items under the jurisdiction of the Commerce Department. While combining the administrative activities

of the NSG related to these two branches will provide less duplication of effort on the part of those countries seeking membership, it

will have no effect on how the United States controls NSG items.

The Transparency Working Group made some progress in developing a proposal for the establishment of an Internet web site; the

German Government, with the technical assistance of the European Community, will establish an official NSG web site in 2001.

The Dual Use Regime meeting addressed member concerns regarding the proposal by one member to supply nuclear fuel to

power plant reactors in India. Thus far, NSG members have refrained from making such exports to India as a result of India’s

detonation of a nuclear device in May 1998. Members agreed to formally consider the proposal to supply nuclear fuel to India.

Australia Group. The Australia Group (AG) is a multilateral export control regime that seeks to impede the proliferation of chemical and biological weapons through the harmonization of export

controls, an exchange of information on global proliferation activities, and outreach to nonmembers. The 32 member countries meet

annually and communicate between sessions to review and refine

the list of controlled chemicals, biological agents, and related equipment and technology.

• Turkey and Cyprus became the newest members of the Australia Group (AG) at the Plenary held in Paris, France, on October

2–5. The U.S. delegation took the opportunity offered by the plenary to present U.S. positions in support of (1) the strengthening

of export controls on graphite composite chemical manufacturing

equipment, centrifugal separators, and impermeable protective

suits; and (2) the removal of controls on medical diagnostic, analytical and food testing kits. At the request of the AG, the United

States also presented a paper on export controls on intangible technology for future discussion.

B. ENCRYPTION/HIGH PERFORMANCE COMPUTER POLICY

Encryption. During the period August 20 to November 13, 2000,

BXA carried out a number of activities to implement revisions to

the Clinton Administration’s encryption policy. These activities included publishing new rules, meeting with industry representative

and technical advisory committees, and working with interagency

groups on emerging encryption policy initiatives.

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• The Administration implemented significant updates to

encryption export controls in January and October 2000. The policy

continues a balanced approach by streamlining export controls

while protecting critical national security interests. The most significant change in the October 19 rule is that a license is no longer

required for exports of encryption items and technology to the European Union and several other major trading partners. The update is consistent with recent regulations adopted by the European

Union; thus assuring continued competitiveness of U.S. industry in

international markets. Other changes include streamlined export

provisions for most mass-market products, beta test software, products that implement short-range wireless encryption technologies

(e.g., Bluetooth), products that enable non-U.S.-sourced products to

operate together and technology for standards development. Additionally, certain U.S.-origin encryption products incorporated into

foreign products do not require a U.S. export license. Post-export

reporting is no longer required for products exported by U.S.-owned

subsidiaries overseas, or for generally available software pre-loaded

on computers or handheld devices. • The October update to encryption policy reflects the invaluable

and ongoing dialogue between the Interagency Working group on

Cryptography (IWG) and various industry, privacy advocates, and

technical advisory groups. Through consultation with groups such

as the President’s Export Council Subcommittee on Encryption

(PECSENC), Regulations and Procedures Technical Advisory Committee (RPTAC), Alliance for Network Security (ANS), Americans

for Computer Privacy (ACP), and Computer Systems Policy Project

(CSPP), the new rules take into account technology trends and

market realities which, if not addressed as a matter of policy,

would only serve to disadvantage U.S. industry and undermine the

national interest. • To support and explain U.S. encryption policy in the international arena, BXA participated in several Wassenaar Arrangement working group meetings to discuss U.S. policy and our proposal to release encryption software considered ‘‘in the public domain.’’ Wassenaar members also discussed proposals to ease or lift

key length restrictions for mass market products. BXA also held

encryption export control policy discussions with other foreign delegations on a bilateral basis.

• BXA continued, during the reporting period, to educate exporters and the general public on the goals of the Clinton Administration’s updated encryption policy, and advise the public on how to

obtain export authorization through licensing and classification requests. BXA presented Information Technology workshops both domestically and internationally in Chicago, Illinois, Stockholm, Sweden and The Hague, Netherlands. Through regular meetings with

U.S. companies and web site updates, BXA provides exporters with

practical guidance concerning encryption export control policy and

procedures.

High Performance Computers. During the reporting period, BXA

engaged in various activities to implement the Clinton Administration’s High Performance Computer (HPC) export control policy, including updating export controls on HPCs, studying alternative

methods for controlling HPCs, meeting with industry counterparts

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to assess their needs, and working on developing bilateral and multilateral relationships with certain countries to ensure appropriate

safeguards are attached to the export of HPCs. • On October 13, 2000, BXA published a rule in the Federal Register implementing the Clinton Administration’s August 3 announcement updating the HPC export control policy. The rule

raised the upper level for License Exception CTP for Computer Tier

2 countries from 33,000 to 45,000 Millions of Theoretical Operations Per Second (MTOPS), and for Computer Tier 3 countries,

from 20,000 to 28,000 for both civil and military end users. This

rule removed the distinction between civil and military end-users

and end-uses in Computer Tier 3 countries. Additionally, Argentina

was moved form Tier 2 to Tier 1. • The October 13, 2000, rule also raised the National Defense

Authorization Act (NDAA) notification and post shipment reporting

levels for HPC exports to Computer Tier 3 countries from 12,500

to 28,000 MTOPS, effective February 26, 2001. Additionally, the

rule moved Estonia from Tier 3 to Tier 2 effective December 28,

2000. • The Information Security Technical Advisory Committee

(ISTAC) continued to study alternative control parameters for

HPCs. CTP-based control levels need to be continually updated in

order to keep up with the rapid technological advances in the computer industry. The need for these significant adjustments calls

into question the viability of the current approach for determining

HPC control levels. For this reason, alternative control parameters

that would provide the flexibility necessary to accommodate future

advances in HPC and microprocessor technology are being explored.

• BXA participated in Wassenaar Arrangement working group

meetings in September. BXA presented a proposal to change multilateral controls to match U.S. controls. BXA also engaged in bilateral negotiations with other HPC producing countries to ensure

that appropriate safeguards and licensing mechanisms are in place

to avoid exports or transfers to countries of concern and proliferation entities.

C. BILATERAL COOPERATION/TECHNICAL ASSISTANCE

As part of the Clinton Administration’s effort to encourage other

countries to strengthen their export control systems, the Department of Commerce and other agencies conducted a wide range of

discussions with a number of foreign countries.

Hong Kong. Under the Hong Kong Policy Act of 1992, the United

States Government will continue its export licensing treatment

that was in effect before the People’s Republic of China regained

control of Hong Kong, as long as Hong Kong maintains an effective

and autonomous export control program. BXA aggressively monitors the status of Hong Kong’s post-reversion export control program to ensure that it continues to be effective and autonomous

from Beijing. By openly and vigilantly observing Hong Kong’s program, BXA supports Hong Kong’s efforts to maintain the separation of it’s export control system from that of the rest of China.

India. BXA officials concluded successful bilateral talks with the

Indian Government in New Delhi during August 7–11, 2000. DurVerDate 11-MAY-2000 13:13 Feb 07, 2001 Jkt 089006 PO 00000 Frm 00010 Fmt 6601 Sfmt 6602 E:\HR\OC\HD038.XXX pfrm04 PsN: HD038
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ing the talks, the Indian Government indicated its interest in participating in several of the export control workshops that the

United States Government proposed. The first of these programs,

an export licensing workshop, was held on October 16–18, 2000, in

Washington. The Indian delegation visited BXA licensing divisions

and heard presentations by BXA attorneys, export licensing officials, export enforcement personnel, representatives of BXA industry advisory committees, and representatives form other agencies

involved in dual-use licensing.

Asia. BXA officials attended the annual Asian Export Control

Seminar in Tokyo in November 2000. Sponsored by Japan, the

United States, the United Kingdom and Australia, the conference

was attended by representatives of Asian governments. The purpose of the annual seminar is to provide information on export controls to Asian governments, some of which have just begun to develop comprehensive systems. BXA plans to participate in the next

annual meeting in Tokyo in March 2001.

China. BXA hosted the first Sino-American export control seminar with China’s Ministry of Foreign Trade and Economic Cooperation (MOFTEC) on October 26–27 in Shanghai, PRC. The

seminar covered various legal and procedural aspects of the U.S.

dual-use export control system. Participants included 180 Chinese

and foreign business representatives based in China as well as approximately 20 Chinese Government officials. After the seminar,

BXA held bilateral talks with Chinese officials on export control

policies and procedures, including the schedule of future cooperative events and end-use visits. The Chinese Government agreed

that bilateral exchanges have been fruitful and should continue in

2001.

South Korea. October 31, 2000, BXA officials participated in a

seminar hosted by the U.S. Foreign Commercial Service and the

American Chamber of Commerce in South Korea on export control

policies and procedures. In addition to a general overview of recent

changes and initiatives within BXA and the EAR, BXA officials

spoke about the recent policy changes towards North Korea.

Israel. On September 17–21, 2000, BXA participated in a visit to

Israel to review bilateral cooperation on export control issues.

Members of the U.S. delegation met with senior officials from the

Israeli Ministries of Defense and Industry and Trade, and with representatives from Israeli and U.S. defense and high-technology

companies. BXA officials conducted a seminar on U.S. export control issues for Israeli industry. During the visit, the Israelis

pledged to strengthen their own export control practices and to continue to adhere with the multilateral export control regimes.

Nonproliferation and Export Control International Cooperation.

During the period August 20 through November 13, 2000, BXA’s

Office of Nonproliferation and Export Control International Cooperation (NEC) hosted, participated in, and/or coordinated seven

technical exchanges on export controls, as well as a multilateral

conference on export controls in Oxford, England, for 32 countries.

These programs sought not only to familiarize the governments of

Central and Eastern Europe, the Baltic and the Balkans, the

Caucasus, Canada, Hong Kong, Japan, Kazakhstan, Uzbekistan,

and Turkey with the major elements comprising an export control

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system that meets international standards for effectiveness, but

also to assist the governments in developing and strengthening

their own national export control systems. These elements involve

five functional areas: the legal and regulatory framework necessary

for an effective export control system, licensing procedures and control lists, enforcement mechanisms, industry-government relations,

and system administration and automation support. Programs conducted during this period also included special activities and other

multilateral conferences that related to NEC objectives. These programs have contributed to a reduction of the proliferation threat

from and through the participating countries by strengthening

these countries’ national export control systems.

D. REGULATORY ACTIONS: PUBLISHED AND PENDING

Crime control items. On September 13, 2000, BXA published a

rule that expanded controls on exports of restraint devices, such as

handcuffs, and discharge type arms, such as stun guns. BXA maintains export controls on these and other crime control items in support of U.S. foreign policy to promote the observance of human

rights throughout the world. Prior to September 13, 2000, these

items did not require a license for export or reexport to Australia,

Japan, or New Zealand, or to NATO countries. A license is now required for all destinations, except Canada. This rule also modified

BXA’s license application review policy for crime control items to

include consideration of whether there is civil disorder in the country or region to which crime control items are proposed to be exported.

Australia Group. On October 3, 2000, BXA published a rule that

implemented several export control changes agreed upon during

the October 1999 Australia Group consultations. The Australia

Group (AG) is a multilateral forum in which 30 participating countries have agreed to maintain export controls on a list of chemicals,

biological agents, and relevant equipment and technology that

could be used in the production of chemical or biological weapons.

The October 3, 2000, rule clarified the scope of controls that apply

to ricin, saxitoxin, toxic gas monitoring systems, and cross-flow filtration equipment. The rule also authorized exports to most destinations, without a license, of certain medical products containing

botulinum toxins and certain diagnostic and food testing kits that

contain AG-controlled toxins. Finally, the rule implemented an AG

agreement on how to deal with mixtures containing trace and unintended quantities of AG-controlled chemicals that are also identified as Schedule 1 chemicals under the Chemical Weapons Convention (CWC). Mixtures that contain less than 0.5% aggregate quantities of Schedule 1 chemicals as unavoidable by-products or impurities do not require a license, provided that the Schedule 1 chemicals have not been intentionally produced or added.

Serbia. On October 12, 2000, in the wake of Vojislav Kostunica’s

victory in the Serbian elections, the United States lifted certain

economic sanctions on Serbia. Initially, this sanctions-easing initiative allowed U.S. commercial air carriers to fly in and out of Belgrade, and removed the ban on exports of petroleum and petroleum

products to Serbia. In a concerted effort to continue targeted measures against Slobodan Milosevic and his close associates, however,

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the U.S. action maintained sanctions against exports to two Serbian oil companies (Jugpetrol and NIS-Nafta) and the Serbian national airline (Jugoslovenski Aerotransport aka JAT).

In addition to the sanctions-easing actions (air travel and oil export bans lifted) related to the October 12 announcement, Commerce, Treasury and State worked to implement the removal of

sanctions and return Serbia to the export control treatment it enjoyed prior to April 30, 1999. Pending publication of this rule, BXA

changed its licensing policy on exports to Serbia from general denial to a case-by-case review.

High Performance Computers. On October 13, 2000, BXA published a rule implementing the August 3 White House announcement updating the HPC export control policy (see detailed discussion under section B. above).

Encryption. BXA published the Clinton Administration’s second

update of its encryption policy during 2000 on October 19, 2000

(see detailed discussion under section B. above).

E. EXPORT LICENSE INFORMATION

During the reporting period, BXA continued to receive many requests for export licensing information through the Freedom of Information Act and through discovery requests during enforcement

proceedings. Under section 12(c) of the Export Administration Act,

BXA continued to withhold from public disclosure information obtained for the purpose of consideration of, or concerning, export license applications, unless the release of such information was determined by the Under Secretary to be in the national interest,

pursuant to the directive in Executive Order No. 12924 to carry out

the provisions of the Export Administration Act, to the extent permitted by law, notwithstanding an adverse decision regarding

BXA’s authority to withhold such information.

F. EXPORT ENFORCEMENT

Export Enforcement continued, through its three offices, its programs of prevention of diversions, investigation and enforcement of

the export control provisions of the Export Administration Regulations, and enforcement of the antiboycott provisions of the Export

Administration Regulations.

Office of enforcement analysis

Preventive/Compliance Activities. The Office of Enforcement

Analysis (OEA) prevention activities included designing a systematic plan to target and prioritize pre-license checks (PLCs) and

post-shipment verifications (PSVs) conducted by representatives of

U.S. diplomatic posts. The purpose of the plan is to ensure that the

PLC and PSV programs, which are coordinated by BXA’s Export

Enforcement, reflect the full range of U.S. export control concerns

and use available resources as effectively as possible.

PLCs validate information on export license applications including the reliability of end-users. In contrast, PSVs strengthen assurances that exporters, shippers, consignees, and end-users comply

with the terms of export licenses and licensing conditions that are

intended to deter diversions from approved end-users and end-uses

of dual-use exports. The overall objective for conducting PLCs and

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PSVs is to detect and prevent the illegal transfer of controlled U.S.-

origin goods and technology.

Another major preventive enforcement activity of OEA is the

compiling of information regarding parties of export control concern

and maintaining these names on Export Enforcement’s watch list.

All of the parties included on this watch list are screened against

names listed on export license applications received by BXA. OEA

analysts review all applications in detail that include a match

against a party on the watch list to assess diversion risks, identify

potential violations, and determine the reliability of proposed endusers of controlled U.S.-origin commodities or technical data.

NDAA Activities. OEA has responsibility for implementing the

High Performance Computer post-shipment verification and annual

report requirements of the National Defense Authorization Act for

FY1998. OEA tracks all post-shipment reporting on exports of

HPCs over a set operating level to ‘‘Tier 3’’ counties, as defined by

the NDAA, and oversees the post-shipment verifications performed

on such exports. OEA has the responsibility for reporting the total

number of HPCs exported and the number of NDAA HPC postshipment verifications performed to Congress in an Annual Report.

Visa Review Program. During the reporting period, OEA continued restructuring its Visa Application Review Program to prevent

unauthorized access to controlled technology or technical data by

foreign nationals visiting the United States. The Office has developed new criteria and thresholds for evaluating visa applications

for targeting purposes. OEA has narrowed its focus and concentrated on specific products most often used in weapons of mass

destruction projects. OEA’s evaluation and analysis of visa application cable traffic involves preventive enforcement efforts such as

recommending denial of certain visas and the referral of enforcement leads to Office of Export Enforcement (OEE) field offices for

possible case development. In some instances, OEE Special Agents

uncovered possible visa fraud on the part of the foreign applicant.

These findings were forwarded to OEA and submitted to the State

Department’s Visa Fraud Unit for further investigation and action

during the reporting period.

Shipper’s Export Declaration Review Program. OEA systematically reviews Shipper’s Export Declarations (SEDs) filed by exporters. Using a computerized index of data fields, OEA produces a list

of SEDs targeted for closer review. These reviews focus particularly

on licensed and license exception shipments, shipments bound for

destinations of concern, and shipments of strategic commodities of

proliferation concerns. Through these reviews, OEA identifies SEDs

that may indicate violations and refers them to OEE special agents

for further enforcement actions.

Office of Export Enforcement

The Office of Export Enforcement opened 187 and closed 372 investigations during the reporting period.

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Office of Antiboycott Compliance Activities

The Office of Antiboycott Compliance continued to supply the

State Department with information on boycott requests received by

U.S. persons. The State Department uses this information in its

discussions with boycotting countries concerning ending the Arab

boycott of Israel. The Office of Antiboycott Compliance opened four

investigations during the reporting period.

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