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[House Document 106-256]
[From the U.S. Government Publishing Office]

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

                               __________

                    U.S. GOVERNMENT PRINTING OFFICE
79-011                     WASHINGTON : 2000

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.
  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 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 six-
month 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 
regionaland 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 dual-use 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.
     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.
    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 dual-use 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 two-pronged 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 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 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 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 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 
andenforcing 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 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-of-flight of Syria's civil passenger 
aircraft are reviewed on a case-by-case 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 foreign-registered aircraft subject to the EAR, 
allowing these aircraft to fly to and from Libya without 
areexport 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 obtained 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 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 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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