U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

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79–011 2000

106th Congress, 2d Session – – – – – – – – – – – – House Document 106–256

SIX MONTH PERIODIC REVIEW WITH REGARDS TO THE

LAPSE OF THE EXPORT ADMINISTRATION ACT OF 1979

MESSAGE

FROM

THE PRESIDENT OF THE UNITED STATES

TRANSMITTING

A CONTINUATION OF 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. 1703(c)

JUNE 14, 2000.—Message and accompanying papers referred to the

Committee on International Relations and ordered to be printed

(1)

To the Congress of the United States:

As required by section 204 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 a

6-month periodic 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.

WILLIAM J. CLINTON.

THE WHITE HOUSE, June 14, 2000.

(3)

PRESIDENT’S PERIODIC REPORT ON THE NATIONAL EMERGENCY

CAUSED BY THE LAPSE OF THE EXPORT ADMINISTRATION ACT OF

1979 FOR AUGUST 19, 1999, TO FEBRUARY 19, 2000

On August 19, 1994, in Executive Order No. 12924, I declared a

national emergency under the International Emergency Economic

Powers Act (IEEPA) (50 U.S.C. 1701 et seq.) 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, as amended (50 U.S.C. App. 2401 et seq.) and the system of

controls maintained under that Act. In that order, I 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 U.S.C. 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)), I issued notices on August 15, 1995, August 14,

1996, August 13, 1997, August 13, 1998, and August 10, 1999, continuing the emergency declared in Executive Order No. 12924.

In 1996, I issued two Executive Orders concerning the transfer

of items from the United States Munitions List to the Commerce

Control List. On October 12, 1996, I issued Executive Order No.

13020 (regarding hot-section technologies for commercial aircraft

engines) and on November 15, 1996, I issued Executive Order No.

13026 (regarding encryption products).

I issued Executive Order No. 12924 pursuant to the authority

vested in me as President by the Constitution and laws of the

United States, including, but not limited to, IEEPA. At that time,

I 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, I have submitted combined activities and expenditures reports for 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, and August 19, 1999.

The following report covers the six-months period from August 19,

1999, to February 19, 2000. Detailed information on export control

activities is contained in the most recent Export Administration
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Annual Report for Fiscal Year 1999 and the January 2000 Report

on Foreign Policy Export Controls, required by section 14 and section 6(f) of the Export Administration Act, respectively, which the

Department of Commerce continues to submit to Congress under a

policy of conforming actions under the Executive Order to the provisions of the Export Administration Act, as appropriate.

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

system of export controls, including antiboycott provisions, contained in the Export Administration Regulations (EAR). In administering these controls, the Department has acted under a policy of

conforming actions under Executive Order Nos. 12924, 13020, and

13026 to the provisions of the Export Administration Act, insofar

as appropriate.

The expenses incurred by the federal government in the sixmonth period from August 19, 1999, to February 19, 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

$24,264,000, most of which represents program operating costs,

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

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

significant developments in the area of export controls:

Multilateral Developments

Wassenaar Arrangement. The Wassenaar Arrangement on Export

Controls for Conventional Arms and Dual-Use Goods and Technologies is a multilateral regime currently 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

dual-use goods and technologies.

• The United States Government continues to participate in submissions of export data made by member countries in the regime

since the November 1996 implementation of the Wassenaar dualuse export control list. The Wassenaar members make dual-use

data submissions on a semiannual basis in April and October.

• The Wassenaar Arrangement’s Initial Elements call for Participating States to assess the overall functioning of the Arrangement.

This assessment was done for the first time in 1999. The 1999 review process provided an opportunity to focus discussions on how

the Arrangement is meeting its objectives. In 1999, four assessment meetings were held. Participating States reaffirmed their

commitment to maintain responsible national security policies consistent with the purposes of the Arrangement. They agreed to

maximize restraint as a matter of national policy when considering

licensing for the export of arms and sensitive dual-use items to all

destinations where the risks are judged to be the greatest, and in

particular to regions where conflict is occurring. In addition, Participating States confirmed their commitment to maintaining

strong law-based enforcement of export controls.
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• The 1999 List review of the Arrangement’s controls on conventional arms and dual-use goods and technologies resulted in major

changes for computers and microprocessors. These relaxations in

controls for computers and microprocessors resulted primarily in

response to U.S. unilateral decisions to apply certain liberalized licensing requirements to these items, in order to reflect rapid technological advances and controllability factors. Agreement for a

Statement of Understanding on the importance of controlling intangible transfers of technology and software was also reached. All

agreed list changes are expected to be incorporated into our national regulations soon. • In February 2000, BXA representatives attended a special

meeting of computer specialists to study the highly complex issue

of upgrading and clustering computers with the intention to develop proposals that would provide effective controls over clustered

systems. The United States tabled a non-paper on the future of domestic export control for high performance computers and microprocessors. This non-paper reaffirms our commitment to provide

Participating States advanced notice of any possible change in our

domestic licensing policies.

Australia Group. The Australia Group (AG) is an informal multilateral export control regime that seeks to impede the proliferation

of chemical and biological weapons (CBW) through the harmonization of export controls, the exchange of information on global proliferation activities, and outreach to nonmembers. The 30 member

countries meet annually and communicate between sessions to review and refine the list of controlled chemicals, biological agents,

and related equipment and technology. • BXA provides technical and policy analysis for the review of

items controlled by the AG. This review permits continued updating of the controls to optimize their nonproliferation impact while

taking into account current chemical and biological trade patterns.

At the October 1999 AG Plenary, BXA participated in the Technical Experts Group’s review of a number of controlled items. As

a result of these meetings, some item descriptions were more finely

tuned to capture items of proliferation concern while excluding benign products.

• BXA supports and complies with the AG’s no undercut policy

which is intended to ensure that AG members are following a common approach to export controls. If one AG member denies an export of an AG-listed item for CBW nonproliferation reasons, all

other members agree not to approve essential identical export license applications without first consulting with the member that

issued the original denial. This policy has worked well to close the

loophole for potential diverters who shop around to acquire items

for proliferation purposes.

• The AG works to impede the proliferation of chemical and biological weapons through outreach to non-AG countries. BXA contributes to this effort by inviting foreign export control officials to

events to discuss national export laws and regulations, including

those relating to the AG. A number of non-AG countries have been

taken steps to adopt AG-Type controls.

• BXA will publish changes to Australia Group-related controls

based on the agreements reached at the 1999 Plenary.
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Chemical Weapons Convention. The Chemical Weapons Convention (CWC) is an international arms control and nonproliferation

treaty that bans chemical weapons (CW) and monitors the legitimate production, processing, consumption, export, and import of

certain toxic chemicals and precursors related to CW. BXA has implemented certain export control provisions of the Convention in

the Export Administration Regulations. During this reporting period, BXA received eight advanced notifications of exports of Schedule 1 chemicals, two annual reports on exports for calendar year

1997, two annual reports on exports for calendar year 1998, and 21

end-use certificates for exports to the Dominican Republic, Israel,

Malaysia, Singapore, Taiwan, and Thailand. BXA returned without

action three annual reports on Schedule 1 exports because they

were not required under the EAR.

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

composed of 35 member countries with the European Commission

as a permanent observer, is an informal group of nations concerned

with the 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 dualuse items that have both nuclear and non-nuclear applications.

Formal annual plenaries are held to provide the opportunity for

multilateral consultations by NSG members on nuclear proliferation concerns. • A NSG Components Working Group meeting was held on September 13–14, 1999, in Vienna, Austria, to discuss proposals offered by the United States and other countries on how and when

to control parts and components for items listed in the NSG Dual

Use Annex. No agreement could be reached on how to approach the

issue, but agreement was reached to hold further discussions on

the proposal. • A number of NSG working groups met in Vienna, Austria, at

an NSG meeting held the week of October 17, 1999. Issues discussed included the institutional arrangements of the NSG, revising the Part I Guidelines, and the addition of controls on parts and

components listed in the Dual Use Annex. With regard to the latter

issue, the Components Working Group decided to take a twopronged approach to determining how to control components. The

first approach is to identify the components themselves, and the

second is to develop a definition of controlled components and to

determine the circumstances under which they would be controlled.

This issue will continue to be explored in working group meetings

to be held over the course of the next year.

• A NSG meeting was held in Vienna, Austria, on November 3,

1999, on the establishment of an official NSG Web site. The decision was made to accept the offer of the University of Georgia’s

Center for International Trade and Security to create and maintain

a NSG Web site at no charge. Discussions are underway to determine the content of the site; it is anticipated it will be completed

by the summer of 2000.

Missile Technology Control Regime (MTCR). The MTCR is an informal group of countries founded in 1987 by the United States and
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its G–7 trading partners 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 United States continued to maintain its multilateral MTCR controls as well as its

unilateral Enhanced Proliferation Control Initiative controls during

the reporting period. • BXA represented the Department at the Missile Technology

Control Regime (MTCR) intercessional Technical Experts Meeting

held in Paris on September 6–7, 1999. Proposals offered at the

intercessional meeting included one that would combine several

categories in the MTCR Annex to make it more concise and similar

to the European Dual-Use and Commerce Control Lists. This proposal was accepted for consideration at the MTCR Technical Experts Meeting in October. • BXA participated in the annual Missile Technology Control Regime (MTCR) Plenary and Technical Experts Meeting held in

Noordwijk, the Netherlands, on October 11–15, 1999. In the information exchange portion of the Plenary, 16 MTCR members actively participated in sharing information on non-MTCR partner

missile programs that constitute serious missile proliferation

threats. Later in the Plenary, the United States proposed that the

MTCR sponsor another workshop on the implementation and enforcement of intangible technology controls, which would serve to

continue the MTCR’s outreach and transparency program. • At the Technical Experts Meeting during the week of October

11, 1999, MTCR partners agreed to relax controls on aluminum

powder and other metal powders used as fuel in solid rocket motors, which will reduce the number of Commerce license applications for metal fuels. State Department licenses for metal fuels will

not be affected by this change. Special dual use items for chemical/

biological weapons delivery systems were also identified that could

be added to the MTCR Equipment and Technology Annex in the future. The proposal first raised at the TEM meeting in September,

to reformat the MTCR Equipment Annex into larger categories

based on the newly reformatted Annex structure, was reviewed,

with action on the proposal tabled for further discussion.

Encryption/High Performance Computer Policy

Encryption: During the period August 19, 1999, to February 19,

2000, BXA carried out a number of activities in relation to the Administration’s encryption policy. Most significantly, on January 14,

2000, BXA published regulations implementing the Administration’s September 16, 1999, announcement to simplify the export of

cryptography. The core of this policy rests on three tenets: a review

of encryption products in advance of sale; a streamlined post-export

reporting system that takes into account industry’s distribution

models; and review of exports to foreign government end-users.

These activities also include reviewing licenses, participating in

multilateral and interagency discussions on encryption policy, and

reaching out to industry members and the public. Much of the policy update resulted from invaluable consultations and comments

provided by industry and privacy groups, such as those provided by
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the President’s Export Council Subcommittee on Encryption

(PECSENC). BXA held three PECSENC meetings during this period. This committee fulfills the Administration’s commitment to

establish a formal mechanism to provide industry, users, state and

local law enforcement, and other privacy groups with the opportunity to advise the U.S. Government on the impact of commercial

encryption policy. Following on its June 1999 recommendations

paper on encryption export liberalization, the PECSENC’s ad-hoc

Experts Working Group, comprising export controls specialists from

subcommittee members’ companies, offered guidance to the Administration throughout the regulation-drafting process.

BXA participated in several Wassenaar working group meetings

and explained the current U.S. licensing policy for cryptographic

products and the rationale behind the policy update. The United

States proposed releasing encryption products considered in the

public domain for discussion at the next Experts Meeting in April

2000. BXA also has discussed encryption export control policy with

numerous foreign delegations on a bilateral basis.

During October 1999, BXA participated in the Free Trade Area

of the Americas (FTAA) E-Commerce Working Group. This subcommittee is studying e-commerce-related issues, such as authentication, security, privacy, market readiness indicators, and taxation to assess the current e-commerce environment in the Western

Hemisphere. The United States delegation reported that approximately 80 percent of the U.S. recommendations on e-commerce language were adopted by the Ministerial Declaration. Furthermore,

BXA agreed to undertake an initiative to brief interested Latin

American countries both in the private sector and public sector on

the United States encryption policy. Corresponding with that effort,

BXA representatives addressed e-commerce and U.S. encryption

issues with Brazilian congressional representatives as a part of the

Worldnet program on e-commerce.

During this reporting period, BXA participated in a number of

events to educate exporters and the general public on the goals of

the Administration’s new encryption policy and the details of the

Bureau’s licensing procedures. The Administration consulted with

numerous industry, privacy, technical, and academic groups as part

of its review of encryption export controls. Further, BXA continued

to conduct individual meetings with U.S. companies to explain and

discuss the revised policy on a weekly basis, and regularly updated

its Web site to provide exporters guidance concerning encryption

export control policy.

High Performance Computers: During the past six months, BXA

has been actively engaged in various activities in order to update

the Administration’s High Performance Computer (HPC) export

control policy. These activities include updating export controls on

HPCs, studying alternative methods for controlling HPCs, meeting

with industry counterparts to assess their needs, and reforming the

HPC licensing process.

On February 16, 2000, the President submitted a report to Congress outlining his intent to raise the National Defense Authorization Act (NDAA) notification requirement for Tier 3 countries from

6,500 MTOPS to 12,500 MTOPS. This change will go into effect August 14, 2000. The report also outlined the President’s intent to
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move Romania from Tier 3 to Tier 2. This change will go into effect

June 15, 2000.

At the request of BXA, the Information Security Technical Advisory Committee (ISTAC) has studied alternative control parameters for HPCs. The significant adjustments required to keep up

with the rapid technological advances in the computer industry call

into question the viability of the current approach for determining

HPC control levels and create the need to explore alternative control parameters that will provide the flexibility necessary to accommodate future advances in HPC and microprocessor technology. Although no single solution has been chosen yet, it appears that the

best idea thus far is a new export control parameter based on the

number of controlled processors used in a computer. The number

of processors used in a system is a better predictor of performance;

however, several technical issues must be resolved before this could

be adopted as a new control metric. • During the past six months, BXA undertook an intensive study

of the HPC licensing process in order to pinpoint unnecessary

choke points, redundant paperwork requirements, and other areas

in need of improvement. As a result of this study, the average license processing time for HPCs has dropped by one-third, and the

Security Safeguard Plan provisions have been modified to reflect

the current technology environment. Additionally, BXA published a

Web site dedicated to HPC controls to provide the public with guidance related to HPC export policy and the license application process. In October 1999, BXA held three seminars (in Washington,

D.C., Texas, and California) to advise the U.S. computer industry

on HPC policy and to further educate industry officials of their duties related to export compliance. Furthermore, BXA maintained an

ongoing dialogue with U.S. computer manufacturers and industry

groups on HPC policy and licensing issues.

Bilateral Cooperation/Technical Assistance

As part of the Administration’s continuing 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. BXA continues to work with the Hong Kong authorities on export licensing and enforcement issues, and maintains a

close working relationship with the Ministry of Trade and Industry

regarding export controls.

On September 1, 1999, BXA representatives met with representatives of the Hong Kong Economic and Trade Office to discuss licensing and export policy issues. The two sides discussed the licensing of items controlled unilaterally by the United States, information technology policy, developments in the Wassenaar Arrangement, and the draft Export Administration Act and other pending

legislation that could affect U.S. export controls relating to Hong

Kong.

On October 6, 1999, officials from the Hong Kong Trade Department met with BXA officials to discuss licensing and policy issues.

The Hong Kong officials sought more extensive information sharing, including access to U.S. export license data to verify reexport

privileges of U.S.-licensed goods, and data on end-users in Hong
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Kong to whom BXA had denied proposed exports. The Hong Kong

officials offered to supply import certificates for items, such as high

performance computers, that enter Hong Kong without an export

license.

China. On September 8–10, 1999, BXA hosted a seven-person

delegation from the People’s Republic of China (PRC) for a seminar

on export licensing and enforcement procedures and practices. The

seminar was a result of an agreement that U.S. and Chinese officials made at the December 1998 Joint Commission on Commerce

and Trade meeting to enhance the bilateral dialogue on export controls. The deputy director of the Science and Technology Division

of the PRC Ministry of Foreign Trade and Economic Cooperation

led the four-person delegation from Beijing; three delegation members were from the PRC Embassy in Washington.

On November 3–5, 1999, four officials from China’s Ministry of

Foreign Trade and Economic Cooperation visited Washington for a

seminar similar to the one held in September. The program was

designed to facilitate a technical exchange on implementing and

enforcing export controls, and included demonstrations of the Bureau of Export Administration’s (BXA) license review system and

the dispute resolution process, meetings with enforcement officials,

and a session with representatives from the Departments of State

and Defense.

India. The Defense Appropriations Act of 2000, enacted on October 25, 1999, mandated that the Administration report to Congress

within 60 days on the list of sanctioned Indian and Pakistani entities. The legislation urged the refinement of the list and suggested

that the criteria for the list be ‘‘entities that make a direct and material contribution to weapons of mass destruction and missile programs.’’ The law also urged that the sanctions be limited to only

those items that can contribute to WMD and missile programs.

Based on this guidance and an interagency consensus, the United

States decided to delete 51 entities from the list and to revise the

licensing policy for low-level technology from a policy of denial to

approval. The Bureau will publish the regulations implementing

these changes in March.

Cuba. The Treasury Department authorized a U.S. company to

stage a major exhibit in Cuba of U.S.-made medical products. The

five-day exhibit was held in late January 2000 in Havana, will

close to 300 Americans, representing almost 100 U.S. firms, displaying their products. BXA issued almost 70 licenses for the temporary export of goods displayed at the exhibition. Since then,

about 30 licenses have been approved for the permanent export, either by sale or donation, of medical goods to Cuba.

Nonproliferation and Export Control Cooperation. During the period August 19, 1999, to February 19, 2000, BXA’s Nonproliferation

and Export Control (NEC) International Cooperation Program

hosted, participated in, and/or coordinated 26 technical exchanges

on export controls in conjunction with representatives from the Departments of State, Defense, Energy, Justice, and the Treasury

(U.S. Customs Service). These programs sought not only to familiarize the governments of Russia, Central Europe, the Balkans, the

Baltics, the Caucasus, and Central Asia with the major elements

comprising an export control system that meets international
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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 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.

Regulatory Actions: Published and Pending

Encryption. On January 14, 2000, BXA published a rule implementing the White House’s streamlined encryption policy announced on September 16, 1999, as well as changes based on a

Wassenaar Arrangement agreement. This rule simplified exports of

encryption while continuing to protect important national interests.

See Section B above for additional detail.

High Performance Computers. On February 1, 2000, the President announced an update to the HPC export control policy. See

Section B above for additional detail on the pending regulatory

changes.

Kosovo. On November 5, 1999, BXA published a rule exempting

exports to Kosovo from the sanctions imposed on Serbia in May

1999.

Export Clearance. On October 4, 1999, BXA and the Census Bureau jointly published proposed rules and request public comment

on clarifying export clearance, including the definition of exporter

and the requirements for filing a Shipper’s Export Declaration.

After review of public comments, both agencies will jointly publish

final rules.

Syria. On September 16, 1999, BXA published a change to the

Export Administration Regulations that revised the license review

policy for the export and reexport to Syria of certain aircraft parts

and components. As a result of this change, license applications for

aircraft parts and components intended to ensure the safety-offlight of Syria’s civil passenger aircraft are reviewed on a case-bycase basis with a presumption of approval.

Libya. On September 13, 1999, BXA revised the Export Administration Regulations to reinstate provisions of license exception AVS

(aircraft and vessels) for temporary reexports to Libya of foreignregistered aircraft subject to the EAR, allowing these aircraft to fly

to and from Libya without a reexport license. This change was

made in response to the suspension of United Nations sanctions

against Libya.

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 continues to withhold from public disclosure information ob-
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tained for the purpose of consideration of, or concerning, export license applications, unless the release of such information is determined by the Under Secretary to be in the national interest, pursuant to Executive Order No. 12924 directive to carry out the provisions of the Export Administration Act, to the extent permitted by

law.

Export Enforcement

Export Enforcement continued, through its three constituent offices, its programs of prevention of diversions, investigation/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. 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

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 or 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 end-users of controlled U.S.-origin commodities or technical

data.

NDAA Activities. As required by the National Defense Authorization Act for FY1998 (NDAA), BXA delivered to the Congress its second annual report on high-performance computer (HPC) exports.

The report, delivered December 13, 1999, identified HPC exports

with processing speeds over 2,000 Million Theoretical Operations

Per Second (MTOPS) to ‘‘Tier 3’’ countries. OEA has responsibility

for implementing the NDAA/HPC Program.

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 con-
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centrated 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 insurances, OEA analysis uncovered possible visa fraud on the part of the foreign applicant.

These findings were forwarded to the State Department’s Fraud

Unit for further investigation and action.

Shipper’s Export Declaration Review Program. OEA systematically reviews Shipper’s Export Declarations (SEDs) field 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 shipments, shipments bound for destinations of concern, and shipments of strategic commodities of proliferation concern. Through these reviews, OEA identifies SEDs that may indicate violations of the Export Administration Regulations and refers

to OEE special agents for further enforcement actions.

Office of Export Enforcement

The Office of Export Enforcement opened 531 and closed 440 investigations during the reporting period.

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 6

and closed 15 investigations during the reporting period.

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