58704 Federal Register / Vol. 79, No. 189 / Tuesday, September 30, 2014 / Proposed Rules 

PART 150—EXEMPTIONS AND 

CONTINUED REGULATORY 

AUTHORITY IN AGREEMENT STATES 

AND IN OFFSHORE WATERS UNDER 

SECTION 274 

■ 14. The authority citation for part 150 

continues to read as follows: 

Authority: Atomic Energy Act secs. 161, 

181, 223, 234 (42 U.S.C. 2201, 2021, 2231, 

2273, 2282); Energy Reorganization Act sec. 

201 (42 U.S.C. 5841); Government Paperwork 

Elimination Act sec. 1704 (44 U.S.C. 3504 

note); Energy Policy Act of 2005, Pub. L. 

109–58, 119 Stat. 594 (2005). 

Sections 150.3, 150.15, 150.15a, 150.31, 

150.32 also issued under Atomic Energy Act 

secs. 11e(2), 81, 83, 84 (42 U.S.C. 2014e(2), 

2111, 2113, 2114). 

Section 150.14 also issued under Atomic 

Energy Act sec. 53 (42 U.S.C. 2073). 

Section 150.15 also issued under Nuclear 

Waste Policy Act secs. 135 (42 U.S.C. 10155, 

10161). 

Section 150.17a also issued under Atomic 

Energy Act sec. 122 (42 U.S.C. 2152). 

Section 150.30 also issued under Atomic 

Energy Act sec. 234 (42 U.S.C. 2282). 

§ 150.15 [Amended] 

■ 15. In § 150.15, remove paragraph 

(a)(9). 

Dated at Rockville, Maryland, this 23rd day 

of September, 2014. 

For the Nuclear Regulatory Commission. 

Annette L. Vietti-Cook, 

Secretary of the Commission. 

[FR Doc. 2014–23257 Filed 9–29–14; 8:45 am] 

BILLING CODE 7590–01–P 

DEPARTMENT OF COMMERCE 

Bureau of Industry and Security 

15 CFR Parts 730, 732, 738, 743, 748, 

752, 762, 772, and 774 

[Docket No. 140613501–4501–01] 

RIN 0694–AG13 

Proposed Amendments to the Export 

Administration Regulations: Removal 

of Special Comprehensive License 

Provisions 

AGENCY: Bureau of Industry and 

Security, Commerce. 

ACTION: Proposed rule. 

SUMMARY: In this rule, the Bureau of 

Industry and Security (BIS) proposes to 

continue updating export controls under 

the Export Administration Regulations 

(EAR) consistent with the Retrospective 

Regulatory Review Initiative that directs 

BIS and other Federal Government 

Agencies to streamline regulations and 

reduce unnecessary regulatory burdens 

on the public. Specifically, in this rule, 

BIS proposes to amend the EAR by 

removing the Special Comprehensive 

License authorization. This rule also 

proposes conforming amendments. 

DATES: Comments must be received no 

later than October 30, 2014. 

ADDRESSES: You may submit comments 

by any of the following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. The identification 

number for this rulemaking is BIS– 

2014–0021. 

• By email directly to 

publiccomments@bis.doc.gov. Include 

RIN 0694–AG13 in the subject line. 

• By mail or delivery to Regulatory 

Policy Division, Bureau of Industry and 

Security, U.S. Department of Commerce, 

Room 2099B, 14th Street and 

Pennsylvania Avenue NW., Washington, 

DC 20230. Refer to RIN 0694–AG13. 

FOR FURTHER INFORMATION CONTACT: 

Thomas Andrukonis, Director, Export 

Management and Compliance Division, 

Office of Exporter Services, Bureau of 

Industry and Security, by telephone at 

(202) 482–8016 or by email at 

Thomas.Andrukonis@bis.doc.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

Origin and Historical Advantages of the 

Special Comprehensive License 

The restructuring and reorganizing of 

the Export Administration Regulations 

(EAR) that were finalized in 1997 

established provisions for the Special 

Comprehensive License (SCL) in part 

752 of the EAR (61 FR 12714, March 25, 

1996, as amended by 62 FR 25451, May 

9, 1997). 

In keeping with the purpose of those 

reforms, which was to ‘‘simplify, clarify 

and make regulations more userfriendly,’’ the SCL made licensing more 

efficient and practical by consolidating 

authorizations for activities (e.g., bulk 

exports and reexports of items as well 

as certain other activities) and extending 

periods that had been authorized under 

the following special licenses: Project, 

Distribution, Service Supply, Service 

Facilities, Aircraft and Vessel Repair 

Station Procedure, and Special 

Chemical Licenses. With the 

implementation of the SCL, those 

special licenses were discontinued. BIS 

was confident that the more flexible 

SCL and a pre-approved internal control 

program (ICP) would advance the 

agency’s fundamental mission of 

ensuring national security without 

unduly burdening legitimate global 

trade. 

When introduced, SCLs presented 

certain advantages to exporters and 

consignees that could not be met by the 

Validated Licenses (formerly referred to 

as Individual Validated Licenses), 

which was the other licensing option at 

that time. In return for committing to 

enhanced administrative 

responsibilities and compliance 

requirements, the SCL authorized, 

among other things: 

• Exports and reexports of multiple 

shipments of all items subject to the 

EAR, with the exception of items 

prohibited by statute or regulation (inter 

alia, items controlled for missile 

technology and short supply reasons) 

and items identified as being of 

significant strategic and proliferation 

concern; 

• Exports and reexports of multiple 

shipments of items to all destinations, 

except to embargoed and terrorist 

supporting destinations (i.e., 

destinations in Country Groups E:1 and 

E:2 in Supplement No. 1 to Part 740 of 

the EAR), and countries that BIS may 

designate on a case-by-case basis; 

• Possible authorization by prior 

approved consignees abroad of 

servicing, support services, stocking 

spare parts, maintenance, capital 

expansion, scientific data acquisition 

support, reselling and reexporting items 

in the form received, and other 

activities, on a case-by-case basis; 

• Exports and reexports of items for a 

period of four years; and 

• Exports and reexports by an SCL 

holder to approved consignees and 

directly to the consignees’ customers, 

the end-users (known as drop shipping). 

In a recent review of the SCL, it 

became apparent that the purposes 

served by an SCL and the advantages it 

provided have been overtaken by 

changes to the EAR, including changes 

that have occurred since the 

implementation of the President’s 

Export Control Reform (ECR) (See 

‘‘Initial Implementation of Export 

Control Reform Rule’’ (73 FR 22660, 

April 16, 2013), effective October 15, 

2013; ‘‘Improving Regulatory Review’’ 

(Executive Order 13563 of January 18, 

2011); and BIS’s ‘‘Notice of Inquiry: 

Retrospective Regulatory Review Under 

E.O. 13563’’ (76 FR 47527, August, 5, 

2011.). 

At the direction of the President, in 

August, 2009, BIS in conjunction with 

other agencies that have export controlrelated jurisdiction began an 

interagency initiative to reform the 

export control system. The reform’s 

objective has been to help strengthen 

our national security and the 

competitiveness of key U.S. 

manufacturing and technology sectors 

while simultaneously enabling export 

control officials to better focus 

government resources on transactions 

that pose the most concern. Some of the 

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Federal Register / Vol. 79, No. 189 / Tuesday, September 30, 2014 / Proposed Rules 58705 

results of this reform effort include 

broadening EAR provisions so that they 

are not more restrictive than similar 

provisions in the International Traffic in 

Arms Regulations. Such broadening 

included extending the validity period 

of most BIS licenses from two years to 

four years, and allowing shipments to 

and among approved end-users. 

For purposes of the Retrospective 

Regulatory Review, the President 

reaffirmed the principles, structures, 

and definitions that were established in 

Executive Order 12866 of September 30, 

1993, and which govern present-day 

regulatory review. Further, the President 

directed agencies to improve their 

regulations by pursuing regulatory 

reviews that ensure public participation, 

the best regulatory tools, weighing the 

benefits and costs of regulations, and 

making regulations consistent, easier to 

read and focused on measurable results. 

BIS’s proposal to discontinue the SCL 

authorization advances the objectives of 

the Retrospective Regulatory Review. 

Additionally, this proposed rule 

addresses concerns about the utility and 

unduly burdensome requirements 

associated with the SCL expressed by 

the exporting public in comments 

submitted in response to the August 5, 

2011, BIS ‘‘Notice of Inquiry, 

Retrospective Regulatory Review Under 

E.O. 13563.’’ One commenter 

responding to that Notice of Inquiry 

stated that the SCL rule is the most 

rigorous and burdensome license. The 

commenter claimed that the SCL rule 

needs ‘‘greater regulatory clarity, less 

administrative burden and greater 

return on resource.’’ The commenter 

went on to note that SCL holders and 

consignees could get a better return on 

the resources expended for the license 

and on compliance efforts if more 

activities were authorized, such as 

manufacturing, if eligible items were 

expanded and if small changes or edits 

to an SCL could be made without the 

need for multiple forms and without the 

extensive processing time of the 

interagency license review. Finally, the 

commenter stated that the time and 

costs associated with the management 

and administrative burden of the SCL 

outweigh the benefit of the license 

especially when a license must be 

obtained for items that are not SCL 

eligible. Another commenter 

recommended the ‘‘deletion’’ of the SCL 

provision and stated that the provision 

‘‘may no longer be practical’’ because of 

the creation of License Exception STA. 

BIS has issued fewer than a dozen 

SCLs, and this limited number of 

license holders and the low volume of 

trade under SCLs are further indicators 

that the present and future value of an 

SCL is outweighed by the burdens 

exporters experience in applying for and 

administering an SCL. Included among 

these burdens are the high monetary 

and resource cost incurred by the SCL 

holders and their consignees related to: 

—Applying for the SCL or an 

amendment, which involves large 

volumes of detailed documentation to 

support that application or 

amendment; 

—Developing, administering, and 

maintaining ICPs, which requires 

extensive time and resources to 

implement and revise; and 

—Traveling and conducting internal 

audits or preparing for U.S. 

Government audits overseas or 

domestically, which involves several 

weeks per year of company staff time 

to prepare for, conduct and assess, in 

addition to the travel expenses 

necessary to carry out the overseas 

audits of consignees. 

The U.S. Government also incurs high 

costs in administering and enforcing the 

SCL program internationally for such a 

limited number of SCL holders, whose 

licenses involve a low volume of trade, 

which could otherwise be more 

efficiently administered under the EAR. 

Augmented Advantages of the EAR’s 

Licenses and Other Authorizations 

BIS’s implementation of the 

President’s initiatives has increased the 

scope of the availability, ease of 

applying for, and practical and 

economic usefulness of export licenses 

and license exceptions under the EAR, 

while facilitating better compliance by 

the exporting public through expanded 

outreach. The President’s initiatives 

have included the following changes to 

the EAR: 

• A four-year export or reexport 

validity period with agency 

consideration of a request for an 

extended validity period on a case-bycase basis; 

• The option to export, reexport, or 

transfer (in-country) to and among 

approved end-users on a license, under 

certain conditions; and 

• The expansion of License Exception 

Temporary imports, exports, and 

reexports, and transfers (in-country) 

(TMP) (Section 740.9), which now 

authorizes temporary exports to a U.S. 

person’s foreign subsidiary, affiliates, or 

facility abroad outside of Country Group 

B, and will, upon request, authorize the 

retention of items abroad beyond one 

year, up to a total of four years. 

Also worth noting are other 

potentially beneficial changes over time 

under the EAR. They include: 

• Easier license application-filing 

procedures where exporters now have 

the ability to save and work on license 

information that they then can submit to 

BIS via the Simplified Network 

Application Process—Redesign System, 

or SNAP–R; 

• Shorter license application 

processing times, typically without prelicense consultations, ICP requirements, 

or post-license system reviews; 

• No requirement for reports for all 

items exported or reexported; 

• Licenses that could include items 

controlled for Missile Technology, Short 

Supply and other reasons excluded from 

the SCL; and 

• No expiration for an authorization 

allowing U.S., foreign, affiliated or 

unaffiliated parties to export and 

reexport approved items to approved 

validated end-users (VEUs). 

These streamlined, more flexible and 

varied authorizations are available, as 

appropriate, to facilitate more efficient 

and practical means of exporting, 

reexporting and transferring (in-country) 

items subject to export controls under 

the EAR without the burdens imposed 

by an SCL. More importantly, the 

amendments proposed in this rule 

eventually will lead to more efficient 

administration and enforcement of 

export controls under the EAR. 

Description of Proposed Changes 

Primary Provisions for the SCL: Part 

752—Special Comprehensive License 

BIS proposes to discontinue the SCL 

authorization, and therefore remove the 

text of the SCL provisions located at 

part 752 (Sections 752.1 through 752.17 

and Supplements No. 1 through No. 5 

to part 752) of the EAR. In addition, BIS 

proposes to reserve part 752. 

Conforming Amendments 

BIS also proposes conforming 

amendments that would remove 

references to the SCL authorization in 

other parts of the EAR. The SCL-related 

provisions that BIS proposes to remove 

from the EAR are set out according to 

part number as follows: 

Part 730—General Information 

• The reference to the SCL in the 

second sentence of paragraph (a)(5) of 

section 730.8 (How to proceed and 

where to get help); and 

• In Supplement No. 1 to Part 730— 

Information Collection Requirements 

Under the Paperwork Reduction Act: 

OMB Control Numbers: 

• References to the SCL in control 

numbers 0694–0088 (Simplified 

Network Application Processing + 

System (SNAP+) and the Multipurpose 

Export License Application) and 0607– 

0152 (Automated Export System (AES) 

Program); and 

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58706 Federal Register / Vol. 79, No. 189 / Tuesday, September 30, 2014 / Proposed Rules 

• The collection of information 

authorized under control number 0694– 

0089 (Special Comprehensive License 

Procedure). 

Part 732—Steps for Using the EAR 

• The reference to the SCL with 

regard to Destination Control Statements 

in paragraph (b) of section 732.5 (Steps 

regarding shipper’s export declaration 

or automated export system record, 

Destination Control Statements, And 

Recordkeeping); and 

• The specific obligations imposed on 

parties to an SCL that appear in 

paragraph (d) of section 732.6 (Steps for 

other requirements). 

Part 738—Commerce Control List 

Overview and the Country Chart 

• References to the SCL in paragraph 

(b)(3) of section 738.4 (Determining 

whether a license is required), which 

provides a sample CCL entry for 

determining whether a license is 

required. 

Part 743—Special Reporting and 

Notification 

• The reporting requirement for 

exports of certain commodities, 

software, and technology controlled 

under the Wassenaar Arrangement 

when the items are authorized under the 

SCL procedure from paragraph (b)(2) of 

section 743.1 (Wassenaar Arrangement); 

and 

• The reporting requirement for 

exports of certain items listed on the 

Wassenaar Arrangement Munitions List 

and the UN Register of Conventional 

Arms when those items are authorized 

under the SCL procedure from 

paragraph (b)(2) of section 743.4 

(Conventional arms reporting). 

Part 748—Applications (Classification, 

Advisory, and License) and 

Documentation 

References and provisions related to 

the SCL in the following paragraphs: 

• Paragraph (d), introductory text, of 

section 748.1 (General provisions), 

which provides that SCL export and 

reexport license applications are 

exempted from electronic filing 

requirements; 

• Paragraph (h) of section 748.4 

(Basic guidance related to applying for 

a license), which provides that 

emergency processing is not available 

for SCL applications; 

• Paragraphs (a) (Scope) and (d) (Role 

of individual users) of section 748.7 

(Registering for electronic submission of 

license application and related 

documents); 

• Paragraph (a)(6) of section 748.9 

(Support documents for license 

applications), which provides that SCL 

applications are exempted from the 

support documents requirement; 

• Paragraph (a)(1)(iii) of section 

748.12 (Special provisions for support 

documents), which provides that an 

item removed from SCL eligibility 

would have a grace period of 45 days for 

complying with support documents 

requirements for a license application 

for the item; and 

• The reference to SCL as a type of 

application in ‘‘Block 5,’’ the entire 

‘‘Block 8’’of ‘‘Supplement No. 1 to Part 

748–BIS–748P, BIS–748P–A; Items 

Appendix; and BIS–748P–B; End-User 

Appendix; Multipurpose Application 

Instructions’’. 

Part 762—Recordkeeping 

References and provisions related to 

the SCL in the following paragraphs: 

• Paragraphs (b)(31) ‘‘§ 752.7, Direct 

shipment to customers,’’ (b)(32) 

‘‘§ 752.9, Action on SCL applications,’’ 

(b)(33) ‘‘§ 752.10, Changes to the SCL,’’ 

(b)(34) ‘‘§ 752.11, Internal Control 

Programs,’’ (b)(35) ‘‘§ 752.12, 

Recordkeeping requirements,’’ (b)(36) 

‘‘§ 752.13, Inspection of records,’’ (b)(37) 

‘‘§ 752.14, System reviews,’’ and (b)(38) 

‘‘§ 752.15, Export clearance’’ of section 

762.2 (Records to be retained). 

Part 772—Definitions of Terms 

• The definition of ‘‘Controlled in 

Fact’’ from section 772.1 (Definitions of 

terms as used in the Export 

Administration Regulations (EAR). 

Part 774—The Commerce Control List 

• Reference to the SCL in the 

‘‘REPORTING REQUIREMENTS’’ 

section of all applicable ECCNs. 

Transition Guidance 

BIS proposes that all SCLs would 

expire one year from the date of 

publication of a final rule that removes 

SCL provisions from the EAR, or the 

expiration date of the SCL under the 

particular terms of the license, 

whichever is earlier. During that 

transition period, which could be up to 

one year after the publication of the 

final rule, BIS will not accept 

amendments, including renewals, to 

outstanding SCLs. After the publication 

of the final rule, SCL holders may 

choose to apply for four-year individual 

licenses for exporting and reexporting 

items under the EAR or use available 

license exceptions. Finally, as with all 

transactions subject to the EAR, the 

applicable recordkeeping requirements 

under 15 CFR part 762 will continue to 

apply to SCL transactions until the 

applicable retention requirements are 

fulfilled. 

Request for Comments 

BIS seeks comments on this proposed 

rule. BIS will consider all comments 

received on or before October 30, 2014. 

All comments (including any personally 

identifying information or information 

for which a claim of confidentially is 

asserted either in those comments or 

their transmittal emails) will be made 

available for public inspection and 

copying. Parties who wish to comment 

anonymously may do so by submitting 

their comments via Regulations.gov, 

leaving the fields that would identify 

the commenter blank and including no 

identifying information in the comment 

itself. See methods for submitting 

comments in the ADDRESSES section of 

this rule. 

Export Administration Act 

Since August 21, 2001, the Export 

Administration Act has been in lapse 

and the President, through Executive 

Order 13222 of August 17, 2001 (3 CFR, 

2001 Comp., 783 (2002), as amended by 

Executive Order 13637 of March 8, 

2013, 78 FR 16129 (March 13, 2013), 

and extended most recently by the 

Notice of August 7, 2014, 79 FR 46959 

(August 11, 2014), has continued the 

EAR in effect under the International 

Emergency Economic Powers Act. BIS 

continues to carry out the provisions of 

the Export Administration Act, as 

appropriate and to the extent permitted 

by law, pursuant to Executive Order 

13222 as amended by Executive Order 

13637. 

Rulemaking Requirements 

1. Executive Orders 13563 and 12866 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). Executive Order 13563 

emphasizes the importance of 

quantifying both costs and benefits, 

reducing costs, harmonizing rules, and 

promoting flexibility. This rule has been 

determined to be a significant regulatory 

action, although not economically 

significant, under section 3(f) of 

Executive Order 12866 for purposes of 

Executive Order 12866. Accordingly, 

the rule has been reviewed by the Office 

of Management and Budget (OMB). 

2. This rule amends collections 

previously approved by the Office of 

Management and Budget (OMB) under 

Control Numbers 0694–0088, 

‘‘Simplified Network Application 

Processing + System (SNAP+) and the 

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Federal Register / Vol. 79, No. 189 / Tuesday, September 30, 2014 / Proposed Rules 58707 

Multi-Purpose Application,’’ which 

carries a burden hour estimate of 43.8 

minutes to prepare and submit form 

BIS–748; 0694–0089, ‘‘Special 

Comprehensive License,’’ which carries 

a burden hour estimate of 40 hours to 

complete an application, 30 minutes to 

complete annual extension requests, 4 

hours to complete amendments, and six 

hours to perform recordkeeping and 

internal control program annual 

certifications; and 0694–0152, 

‘‘Automated Export System (AES) 

Program,’’ which carries a burden hour 

estimate of three minutes or 0.05 hours 

per electronic submission. This 

requirement has been submitted to OMB 

for approval. 

The total burden hours associated 

with the Paperwork Reduction Act of 

1995 (44 U.S.C. 3501 et seq.) (PRA) and 

the aforementioned OMB Control 

Numbers would be expected to decrease 

as a result of this proposed removal of 

part 752 of the EAR and related 

provisions this rule if the rule is 

eventually issued in final form, thereby 

reducing burden hours associated with 

approved collections related to the EAR. 

Public comment is sought regarding: 

Whether this proposed collection of 

information is necessary for the proper 

performance of the functions of the 

agency, including whether the 

information shall have practical utility; 

the accuracy of the burden estimate; 

ways to enhance the quality, utility, and 

clarity of the information to be 

collected; and ways to minimize the 

burden of the collection of information, 

including through the use of automated 

collection techniques or other forms of 

information technology. Send comments 

on these or any other aspects of the 

collection of information to Regulatory 

Policy Division, Bureau of Industry and 

Security, U.S. Department of Commerce 

at the ADDRESSES above, and email to 

OMB at OIRA_Submission@

omb.eop.gov, or fax to (202) 395–7285. 

Notwithstanding any other provision 

of the law, no person is required to 

respond to, nor shall any person be 

subject to a penalty for failure to comply 

with, a collection of information subject 

to the requirements of the PRA, unless 

that collection of information displays a 

currently valid OMB Control Number. 

3. This rule does not contain policies 

with Federalism implications as that 

term is defined under Executive Order 

13132. 

4. Regulatory Flexibility Act of 1980 

(5 U.S.C. 601 et seq.). The Chief Counsel 

for Regulation of the Department of 

Commerce has certified to the Chief 

Counsel for Advocacy of the Small 

Business Administration that this 

proposed rule, if adopted in final form, 

would not have a significant economic 

impact on a substantial number of small 

entities. 

Economic Impact. BIS believes this 

rule will reduce the economic impact on 

impacted entities because although this 

rule would eliminate the availability of 

the SCL, such entities could still obtain 

individual validated licenses from BIS 

to export their product. In fact, the other 

licenses available are less burdensome 

and require fewer compliance/reporting 

measures than those associated with 

SCL. It would be an overall reduction in 

burden for an SCL holder to transition 

to one of the other available licenses 

authorized under the EAR. For example, 

under the SCL, a license holder was 

required to implement a specific 

internal control program (ICP). Under a 

license established under the ECR, the 

impacted entities would be measured by 

their ultimate compliance with the EAR. 

Also with a license established under 

the ECR, SCL holders can transition to 

a four-year license through the validated 

license process. In addition, they have 

the availability of license exception 

Strategic Trade Authorization (STA), 

which allows shipments of higher-end 

controlled items than allowed under the 

SCL, when conditions are met. Also, 

impacted entities would have the 

convenience of applying for a license 

via the Simplified Network Application 

Process-Redesign (SNAP–R) System, an 

updated system for electronically filing 

export and reexport license 

applications. 

Number of Small Entities. The types 

entities that would be directly impacted 

by this action include manufactures, oil 

and gas exploration and production 

companies, and exporters and 

reexporters of various equipment. Based 

on a review of current Special 

Comprehensive License (SCL) holders, 

there are less than a dozen entities that 

have outstanding licenses for items on 

the CCL. Due to the nature of the SCL, 

BIS expects that most of the current 

license holders would be considered 

large entities under the Small Business 

Administration’s size standards. 

However, BIS does not collect data on 

the size or annual revenue of these 

entities, and thus some of these entities 

may be considered small under the SBA 

size standards. Also, although small 

entities are not the primary users of the 

SCL, BIS acknowledges that small 

entities may have been parties to SCL 

transactions. To assist in the evaluation 

of a significant economic impact of this 

rule on a substantial number of small 

entities, BIS welcomes comments to 

explain how and to what extent your 

business or organization could be 

affected, if your business or organization 

is a small entity and if adoption of any 

of the amendments discussed in this 

proposed rulemaking could have a 

significant financial impact on your 

operations. 

List of Subjects 

15 CFR Part 730 

Administrative practice and 

procedure, Advisory committees, 

Exports, Reporting and recordkeeping 

requirements, Strategic and critical 

materials. 

15 CFR Parts 732, 748, and 752 

Administrative practice and 

procedure, Exports, Reporting and 

recordkeeping requirements. 

15 CFR Parts 738 and 772 

Exports. 

15 CFR Part 743 

Administrative practice and 

procedure, Reporting and recordkeeping 

requirements. 

15 CFR 762 

Administrative practice and 

procedure, Business and industry, 

Confidential business information, 

Exports, Reporting and recordkeeping 

requirements. 

15 CFR 774 

Exports, Reporting and recordkeeping 

requirements. 

Accordingly, under the authority of 

50 U.S.C. 1701 et seq., parts 730, 732, 

738, 743, 748, 752, 762, 772 and 774 of 

the Export Administration Regulations 

(15 CFR parts 730–774) are proposed to 

be amended as follows: 

PART 730—[AMENDED] 

■ 1. The authority citation for part 730 

continues to read as follows: 

Authority: 50 U.S.C. app. 2401 et seq.; 50 

U.S.C. 1701 et seq.; 10 U.S.C. 7420; 10 U.S.C. 

7430(e); 22 U.S.C. 287c; 22 U.S.C. 2151 note; 

22 U.S.C. 3201 et seq.; 22 U.S.C. 6004; 30 

U.S.C. 185(s), 185(u); 42 U.S.C. 2139a; 42 

U.S.C. 6212; 43 U.S.C. 1354; 15 U.S.C. 1824a; 

50 U.S.C. app. 5; 22 U.S.C. 7201 et seq.; 22 

U.S.C. 7210; E.O. 11912, 41 FR 15825, 3 CFR, 

1976 Comp., p. 114; E.O. 12002, 42 FR 35623, 

3 CFR, 1977 Comp., p. 133; E.O. 12058, 43 

FR 20947, 3 CFR, 1978 Comp., p. 179; E.O. 

12214, 45 FR 29783, 3 CFR, 1980 Comp., p. 

256; E.O. 12851, 58 FR 33181, 3 CFR, 1993 

Comp., p. 608; E.O. 12854, 58 FR 36587, 3 

CFR, 1993 Comp., p. 179; E.O. 12918, 59 FR 

28205, 3 CFR, 1994 Comp., p. 899; E.O. 

12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 

950; E.O. 12947, 60 FR 5079, 3 CFR, 1995 

Comp., p. 356; E.O. 12981, 60 FR 62981, 3 

CFR, 1995 Comp., p. 419; E.O. 13020, 61 FR 

54079, 3 CFR, 1996 Comp., p. 219; E.O. 

13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 

228; E.O. 13099, 63 FR 45167, 3 CFR, 1998 

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58708 Federal Register / Vol. 79, No. 189 / Tuesday, September 30, 2014 / Proposed Rules 

Comp., p. 208; E.O. 13222, 66 FR 44025, 3 

CFR, 2001 Comp., p. 783; E.O. 13224, 66 FR 

49079, 3 CFR, 2001 Comp., p. 786; E.O. 

13338, 69 FR 26751, 3 CFR, 2004 Comp., p 

168; E.O. 13637 of March 8, 2013, 78 FR 

16129 (March 13, 2013); Notice of September 

18, 2013, 78 FR 58151 (September 20, 2013); 

Notice of November 7, 2013, 78 FR 67289 

(November 12, 2013); Notice of January 21, 

2014, 79 FR 3721 (January 22, 2014); Notice 

of May 7, 2014, 79 FR 26589 (May 9, 2014); 

Notice of August 7, 2014, 79 FR 46959 

(August 11, 2014). 

§ 730.8 [Amended] 

■ 2. Section 730.8 is amended by 

removing the next to last sentence in 

paragraph (a)(5). 

Supplement No. 1 to Part 730 

[Amended] 

■ 3. Supplement No. 1 to Part 730 is 

amended by: 

■ a. Revising the entry in the ‘‘Reference 

in the EAR’’ Column for ‘‘Collection 

number’’ ‘‘0694–0088’’ to read ‘‘parts 

746 and 748; § 762.2(b).’’; 

■ b. Removing the entire entry for 

‘‘Collection number’’ ‘‘0694–0089’’; and 

■ c. Removing the citations to 

‘‘752.7(b)’’ and ‘‘752.15(a)’’ from the 

‘‘Reference in the EAR’’ Column for 

‘‘Collection number’’ ‘‘0607–0152’’. 

PART 732—[AMENDED] 

■ 4. The authority citation for part 732 

continues to read as follows: 

Authority: 50 U.S.C. app. 2401 et seq.; 50 

U.S.C. 1701 et seq.; E.O. 13026, 61 FR 58767, 

3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 

FR 44025, 3 CFR, 2001 Comp., p. 783; Notice 

of August 7, 2014, 79 FR 46959 (August 11, 

2014). 

■ 5. Section 732.5 is amended by 

revising the next to last sentence of 

paragraph (b) to read as follows: 

§ 732.5 Steps Regarding Shipper’s Export 

Declaration or Automated Export System 

Record, Destination Control Statements, 

And Recordkeeping. 

* * * * * 

(b) Step 28: Destination Control 

Statement * * * DCS requirements do 

not apply to reexports * * * 

* * * * * 

§ 732.6 [Amended] 

■ 6. Section 732.6 is amended by 

removing and reserving paragraph (d). 

PART 738—[AMENDED] 

■ 7. The authority citation for 15 CFR 

part 738 continues to read as follows: 

Authority: 50 U.S.C. app. 2401 et seq.; 50 

U.S.C. 1701 et seq.; 10 U.S.C. 7420; 10 U.S.C. 

7430(e); 22 U.S.C. 287c; 22 U.S.C. 3201 et 

seq.; 22 U.S.C. 6004; 30 U.S.C. 185(s), 185(u); 

42 U.S.C. 2139a; 42 U.S.C. 6212; 43 U.S.C. 

1354; 15 U.S.C. 1824a; 50 U.S.C. app. 5; 22 

U.S.C. 7201 et seq.; 22 U.S.C. 7210; E.O. 

13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 

228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 

Comp., p. 783; Notice of August 7, 2014, 79 

FR 46959 (August 11, 2014). 

§ 738.4 [Amended] 

■ 8. Section 738.4 is amended by 

removing the phrase ‘‘or Special 

Comprehensive License’’ at the end of 

the sixth sentence in paragraph (b)(3). 

PART 743—[AMENDED] 

■ 9. The authority citation for part 743 

continues to read as follows: 

Authority: 50 U.S.C. app. 2401 et seq.; 50 

U.S.C. 1701 et seq.; E.O. 13222, 66 FR 44025, 

3 CFR, 2001 Comp., p. 783; E.O. 13637 of 

March 8, 2013, 78 FR 16129 (March 13, 

2013); 78 FR 16129 ; Notice of August 7, 

2014, 79 FR 46959 (August 11, 2014). 

§ 743.1 [Amended] 

■ 10. Section 743.1 is amended by 

removing and reserving paragraph 

(b)(2). 

§ 743.4 [Amended] 

■ 11. Section 743. 4 is amended by 

removing and reserving paragraph 

(b)(2). 

PART 748—[AMENDED] 

■ 12. The authority citation for part 748 

continues to read as follows: 

Authority: 50 U.S.C. app. 2401 et seq.; 50 

U.S.C. 1701 et seq.; E.O. 13026, 61 FR 58767, 

3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 

FR 44025, 3 CFR, 2001 Comp., p. 783; Notice 

of August 7, 2014, 79 FR 46959 (August 11, 

2014). 

§ 748.1 [Amended] 

■ 13. Section 748.1 is amended by 

removing the phrase ‘‘Special 

Comprehensive License or’’ from the 

parenthetical in the first sentence in 

paragraph (d), introductory text. 

§ 748.4 [Amended] 

■ 14. Section 748.4 is amended by 

removing the next to last sentence in 

paragraph (h). 

§ 748.7 [Amended] 

■ 15. Section 748.7 is amended by 

removing the phrase ‘‘Special 

Comprehensive License and’’ from the 

parenthetical in the second sentence in 

paragraph (a) and from the parenthetical 

in the first sentence in paragraph (d). 

§ 748.9 [Amended] 

■ 16. Section 748.9 is amended by 

removing and reserving paragraph (a)(6). 

§ 748.12 [Amended] 

■ 17. Section 748.12 is amended by: 

■ a. Removing the semicolon and the 

word ‘‘or’’ at the end of paragraph 

(a)(1)(ii) 

■ b. Adding a period at the end of 

paragraph (a)(1)(ii); and 

■ c. Removing paragraph (a)(1)(iii). 

Supplement No. 1 to Part 748 

[Amended] 

■ 18. Supplement No. 1 to Part 748 is 

amended by: 

■ a. Removing the next to last sentence 

and the caption, ‘‘Special 

Comprehensive License’’ that precedes 

it in paragraph ‘‘Block 5:’’ and 

■ b. Removing and reserving paragraph 

‘‘Block 8’’. 

PART 752—[REMOVED AND 

RESERVED] 

■ 19. Remove and reserve part 752. 

PART 762—[AMENDED] 

■ 20. The authority citation for part 762 

continues to read as follows: 

Authority: 50 U.S.C. app. 2401 et seq.; 50 

U.S.C. 1701 et seq.; E.O. 13222, 66 FR 44025, 

3 CFR, 2001 Comp., p. 783; Notice of August 

7, 2014, 79 FR 46959 (August 11, 2014). 

§ 762.2 [Amended] 

■ 21. Section 762.2 is amended by 

removing and reserving paragraphs 

(b)(31) through (38). 

PART 772—[AMENDED] 

■ 22. The authority citation for part 772 

continues to read as follows: 

Authority: 50 U.S.C. app. 2401 et seq.; 50 

U.S.C. 1701 et seq.; E.O. 13222, 66 FR 44025, 

3 CFR, 2001 Comp., p. 783; Notice of August 

7, 2014, 79 FR 46959 (August 11, 2014). 

§ 772.1 [Amended] 

■ 23. Section 772.1 is amended by 

removing the definition ‘‘Controlled In 

Fact.’’ 

PART 774—[AMENDED] 

■ 24. The authority citation for part 774 

continues to read as follows: 

Authority: 50 U.S.C. app. 2401 et seq.; 50 

U.S.C. 1701 et seq.; 10 U.S.C. 7420; 10 U.S.C. 

7430(e); 22 U.S.C. 287c, 22 U.S.C. 3201 et 

seq.; 22 U.S.C. 6004; 30 U.S.C. 185(s), 185(u); 

42 U.S.C. 2139a; 42 U.S.C. 6212; 43 U.S.C. 

1354; 15 U.S.C. 1824a; 50 U.S.C. app. 5; 22 

U.S.C. 7201 et seq.; 22 U.S.C. 7210; E.O. 

13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 

228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 

Comp., p. 783; Notice of August 7, 2014, 79 

FR 46959 (August 11, 2014). 

Supplement No. 1 to Part 774 

[Amended] 

■ 25. Supplement No. 1 to part 774 (the 

Commerce Control List) is amended by 

removing the phrase ‘‘Special 

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Federal Register / Vol. 79, No. 189 / Tuesday, September 30, 2014 / Proposed Rules 58709 

1 16 U.S.C. 824o (2012). 

2NERC proposes to define Operating Instruction 

as ‘‘[a] command by operating personnel 

responsible for the Real-time operation of the 

interconnected Bulk Electric System to change or 

preserve the state, status, output, or input of an 

Element of the Bulk Electric System or Facility of 

the Bulk Electric System. (A discussion of general 

information and of potential options or alternatives 

. . . is not considered an Operating Instruction.)’’ 

3 16 U.S.C. 824o(c) and (d). 

4See id. 824o(e). 

5North American Electric Reliability Corp., 116 

FERC ¶ 61,062, order on reh’g & compliance, 117 

FERC ¶ 61,126 (2006), aff’d sub nom. Alcoa, Inc. 

v. FERC, 564 F.3d 1342 (D.C. Cir. 2009). 

Comprehensive Licenses,’’ wherever it 

is found. 

Kevin J. Wolf, 

Assistant Secretary for Export 

Administration. 

[FR Doc. 2014–23078 Filed 9–29–14; 8:45 am] 

BILLING CODE 3510–33–P 

DEPARTMENT OF ENERGY 

Federal Energy Regulatory 

Commission 

18 CFR Part 40 

[Docket No. RM14–13–000] 

Communications Reliability Standards 

AGENCY: Federal Energy Regulatory 

Commission. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: The Commission proposes to 

approve Communications Reliability 

Standard COM–001–2 and Operating 

Personnel Communications Protocols 

Reliability Standard COM–002–4, 

developed by the North American 

Electric Reliability Corporation (NERC), 

which the Commission has certified as 

the Electric Reliability Organization 

responsible for developing and 

enforcing mandatory Reliability 

Standards. The Commission believes 

that the proposed Reliability Standards 

will enhance reliability over the 

currently-effective COM standards in 

several respects by, among other things, 

requiring adoption of predefined 

communication protocols, annual 

assessment of those protocols and 

operating personnel’s adherence thereto, 

training on the protocols, and use of 

three-part communications. However, 

the Commission proposes to direct 

NERC to modify proposed Reliability 

Standard COM–001–2 to include 

internal communications capabilities. 

DATES: Comments are due December 1, 

2014. 

ADDRESSES: Comments, identified by 

docket number, may be filed in the 

following ways: 

• Electronic Filing through http://

www.ferc.gov. Documents created 

electronically using word processing 

software should be filed in native 

applications or print-to-PDF format and 

not in a scanned format. 

• Mail/Hand Delivery: Those unable 

to file electronically may mail or handdeliver comments to: Federal Energy 

Regulatory Commission, Secretary of the 

Commission, 888 First Street NE., 

Washington, DC 20426. 

Instructions: For detailed instructions 

on submitting comments and additional 

information on the rulemaking process, 

see the Comment Procedures Section of 

this document. 

FOR FURTHER INFORMATION CONTACT: 

Vincent Le (Technical Information), 

Office of Electric Reliability, Federal 

Energy Regulatory Commission, 888 

First Street NE., Washington, DC 

20426, (202) 502–6204, Vincent.le@

ferc.gov. 

Michael Gandolfo (Technical 

Information), Office of Electric 

Reliability, Federal Energy Regulatory 

Commission, 888 First Street NE., 

Washington, DC 20426, (202) 502– 

6817, Michael.gandolfo@ferc.gov. 

Julie Greenisen (Legal Information), 

Office of the General Counsel, Federal 

Energy Regulatory Commission, 888 

First Street NE., Washington, DC 

20426, (202) 502–6362, 

julie.greenisen@ferc.gov. 

Robert T. Stroh (Legal Information), 

Office of the General Counsel, Federal 

Energy Regulatory Commission, 888 

First Street NE., Washington, DC 

20426, Telephone: (202) 502–8473, 

Robert.Stroh@ferc.gov. 

SUPPLEMENTARY INFORMATION: 

1. Pursuant to section 215 of the 

Federal Power Act (FPA),1 the 

Commission proposes to approve two 

Reliability Standards, COM–001–2 

(Communications) and COM–002–4 

(Operating Personnel Communications 

Protocols), developed by the North 

American Electric Reliability 

Corporation (NERC), which the 

Commission has certified as the Electric 

Reliability Organization responsible for 

developing and enforcing mandatory 

Reliability Standards. In addition, the 

Commission proposes to approve three 

new terms to be added to the NERC 

Glossary of Terms, and the violation risk 

factors, violation severity levels, and 

proposed implementation plan for both 

revised standards. 

2. Proposed Reliability Standard 

COM–001–2 is intended to establish a 

clear set of requirements for the 

communications capabilities that 

applicable functional entities must have 

in place and maintain. Proposed 

Reliability Standard COM–002–4 

requires applicable entities to develop 

communication protocols with certain 

minimum requirements, including use 

of three-part communication when 

issuing Operating Instructions.2

Proposed Reliability Standard COM– 

002–4 also sets out certain 

communications training requirements 

for all issuers and recipients of 

Operating Instructions, and establishes a 

flexible enforcement approach for 

failure to use three-part communication 

during non-emergencies and a ‘‘zerotolerance’’ enforcement approach for 

failure to use three-part 

communications during an emergency. 

3. The Commission believes that the 

proposed Reliability Standards will 

enhance reliability over the currentlyeffective COM standards in several 

respects. For example, the proposed 

Reliability Standards expand 

applicability to include generator 

operators and distribution providers and 

eliminate certain ambiguities in the 

currently-effective standard. Thus, the 

Commission proposes to approve the 

modified COM standards. However, the 

Commission seeks additional 

information and explanation on 

responsibility for use of three-part 

communication by transmission owners 

and generation owners that receive 

Operating Instructions. In addition, the 

Commission proposes to direct NERC to 

modify proposed Reliability Standard 

COM–001–2 to include internal 

communication capabilities, and seeks 

additional information on the lack of a 

testing requirement for distribution 

providers and generator operators in 

COM–001–2 and on the intended 

meaning and use of the proposed terms 

Interpersonal Communication and 

Alternative Interpersonal 

Communication. 

I. Background 

A. Regulatory Background 

4. Section 215 of the FPA requires a 

Commission-certified Electric 

Reliability Organization (ERO) to 

develop mandatory and enforceable 

Reliability Standards, subject to 

Commission review and approval.3

Once approved, the Reliability 

Standards may be enforced by the ERO 

subject to Commission oversight, or by 

the Commission independently.4 In 

2006, the Commission certified NERC as 

the ERO pursuant to FPA section 215.5

5. The Commission approved 

Reliability Standard COM–001–1 in 

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