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###### Department of Commerce

###### Bureau of Industry and Security

          - 15 CFR Parts 744 and 746
          - [Docket No. 241028-0281]
          - RIN 0694-AJ93

# AGENCY:

Bureau of Industry and Security, Department of Commerce.

# ACTION:

Final rule.

# SUMMARY:

In this final rule, the Bureau of Industry and Security (BIS) makes changes to the export controls against Russia and Belarus under the Export Administration Regulations (EAR). This final rule expands the scope of the Russian and Belarusian Industry Sector Sanctions by imposing controls on nine key precursors for riot control agents and a chemical weapon that Russia has deployed against Ukraine in violation of the Chemical Weapons Convention (CWC). This final rule also makes adjustments to exclusions, exceptions, and licensing policy for exports, reexports, or transfers (in-country) to certain components of the governments of Country Group A:5 and A:6 destinations that are in Russia and Belarus. Lastly, this final rule clarifies that the Russia/Belarus-Military End User and Procurement Foreign-Direct Product (FDP) rule and the EAR's other Entity List FDP rules' license requirements extend to or within any destination or to any end user or party that otherwise meets the criteria. This final rule is being published concurrently with a BIS final rule, “Additions and Revisions of Entities to the Entity List” (RIN 0694-AJ94), which includes additional changes related to export controls related to Russia and Belarus.

# DATES:

This rule is effective November 1, 2024.

# FOR FURTHER INFORMATION CONTACT:

                        For general questions on this final rule, contact Collmann Griffin, Senior Policy Advisor, International Policy Office, Bureau of Industry and Security, Department of Commerce, Phone: 202-482-1430, Email:                         *william.griffin@bis.doc.gov.*

                        For questions on the Entity List changes in this final rule, contact the Chair, End-User Review Committee, Office of the Assistant Secretary for Export Administration, Bureau of Industry and Security, Department of Commerce, Phone: (202) 482-5991, Email:                         *ERC@bis.doc.gov.*                         For emails, include “Russia and Belarus, October 2024 export control measures” in the subject line.                    

# SUPPLEMENTARY INFORMATION:

## I. Background

### A. Export Controls Implemented Against Russia and Belarus

In response to Russia's February 2022 full-scale invasion of Ukraine, BIS imposed extensive export controls on Russia under the EAR as part of the final rule, “Implementation of Sanctions Against Russia Under the Export Administration Regulations (EAR)” (“Russia Sanctions Rule”) (87 FR 12226, March 3, 2022). To address Belarus's complicity in the invasion, BIS imposed similar export controls on Belarus under the EAR in a final rule, “Implementation of Sanctions Against Belarus” (“Belarus Sanctions Rule”) (87 FR 13048, March 6, 2022). Since March 2022, BIS has published numerous final rules strengthening the export controls on Russia and Belarus, including measures undertaken in coordination with U.S. allies and partners.

### B. Overview of This Final Rule

BIS is amending the EAR (15 CFR parts 730-744) to strengthen export controls against Russia and Belarus by expanding the scope of the Russian and Belarusian Industry Sector Sanctions and clarify the applicability of the Entity List FDP rules. BIS in this final rule is also making adjustments to exclusions, exceptions, and licensing policy for exports, reexports, or transfers (in-country) of items for the official business of diplomatic or consular missions of the governments of Country Group A:5 and A:6 destinations that are located in Russia and Belarus.

The Export Control Reform Act (ECRA) provides the legal basis for BIS's principal authorities and serves as the authority under which BIS issues this rule.

The three sets of changes this final rule makes are described in section II as follows:

A. Additions to supplement no. 6 to part 746 to control nine key precursors for riot control agents and a chemical weapon that Russia has deployed against Ukraine;

                    B. Changes related to governments of Country Group A:5 and A:6 destinations for certain exclusions, license exception eligibility, and licensing policy;                     *and*

C. Clarifying that the Entity List FDP rules' license requirement extends to or within any destination or to any end user or party that otherwise meets the criteria.

## II. Amendments to the EAR

### A. Additions to Supplement No. 6 to Part 746 To Control Key Precursors for Riot Control Agents and a Chemical Weapon That Russia Has Deployed Against Ukraine

The U.S. Department of Commerce is expanding controls under the EAR to include certain chemical precursors that are essential for the “production” of chemical riot control agents (RCAs) and chloropicrin that Russia has deployed against Ukraine in violation of the Chemical Weapons Convention (CWC). These new regulatory restrictions, which are specific to Russia and Belarus, aim to limit the use of these chemical precursors in the context of the war in Ukraine.

RCAs such as tear gas and other crowd dispersal chemicals have the potential for misuse in the context of armed conflict. While RCAs are commonly used by law enforcement, their use as a method of warfare is prohibited by Article I of the CWC. Chloropicrin is a toxic chemical included on Schedule 3 of the CWC's Annex on Chemicals. Its use against Ukrainian armed forces constitutes use of a chemical weapon and is also prohibited under Article I of the CWC.

                    On April 4, 2024, the Department of State published its annual report to Congress on Compliance with the Chemical Weapons Convention (CWC), which stated that Russia had used RCAs as a method of warfare against Ukrainian forces in violation of the CWC. This report concluded that “the United States assesses that Russia has repeatedly used RCAs as a method of warfare across the frontlines in Ukraine.” On May 1, 2024, the Department of State announced that it had made a determination pursuant to the Chemical and Biological Weapons Control and Warfare Elimination Act of 1991 (CBW Act of 1991) (22 U.S.C. 5604-5605) that Russia had used chloropicrin against Ukrainian troops in violation of the CWC (see May 1, 2024 State Dept. Fact Sheet (Imposing New Measures on Russia for its Full-Scale War and Use of Chemical Weapons Against Ukraine)). On June 7, 2024, in connection with this determination under the CBW Act of 1991, the Acting                           ( print page 87280)                        Under Secretary of State for Political Affairs imposed restrictions on Russia, including on arms sales and related financing. The                     **Federal Register**                     Notice announcing these restrictions made reference to the export controls that Commerce maintains on Russia under parts 744 and 746 (see 89 FR 48701, June 7, 2024).                

Russia's use of RCAs as a method of warfare and its use of chloropicrin as a chemical weapon during its war of aggression in Ukraine raise concerns about Russia's further production and weaponization of these chemicals. Controlling the export of key chemical precursors, therefore, represents a critical step toward preventing the misuse of these chemicals in furtherance of Russia's military efforts.

This final rule builds upon a BIS final rule that imposed controls on two precursors of chloropicrin, nitromethane and picric acid, as part of a set of restrictions on Russia and Belarus by targeting chemicals that could be useful for Russia's chemical and biological weapons production capabilities or diverted from Belarus to Russia for these activities of concern (87 FR 57068, September 16, 2022). Adding additional chemical precursors of chloropicrin in this current rule further supports that objective.

In assessing whether to impose these new controls, it is important to acknowledge that the chemical precursors listed for control play a significant role in civilian applications. For example, these chemical precursors are used in the production of pharmaceuticals for treating respiratory ailments and in anesthetic formulations. In agriculture, these precursor chemicals can function as pest control agents or can be used for the production of fertilizers, both crucial to food security and medical treatments. Recognizing these civilian applications, these new controls are narrowly tailored to apply only to Russia and Belarus. The restrictions address the CWC Treaty's objective regarding the need to guard against the potential misuse of these chemical precursors while ensuring continuing exports, reexports, and transfers (in-country) as part of supply chains related to legitimate use under the CWC, particularly in medical and agricultural sectors, in all destinations, which for purposes of license applications for Russia and Belarus is addressed under the case-by-case license review policy under § 746.8(b)(3)(iii).

Therefore, this final rule adds a new paragraph (i) (Precursors for riot control agents and chloropicrin as follows) to supplement no. 6 to part 746 to control certain precursors of CS (o-Chlorobenzylidenemalononitrile or o-Chlorobenzalmalononitrile) (CAS 2698-41-1); CN (Phenylacyl chloride or w-Chloroacetophenone) (CAS 532-27-4); and Trichloro(nitro)methane (Chloropicrin—CAS 76-06-2) and CR (Dibenzoxazpine—CAS 257-07-8). Specifically, this final rule adds paragraphs (i)(1) through (9) to describe these chemical precursors that will be controlled under the EAR's Russian and Belarusian Industry Sector Sanctions. The chemical precursors listed below may be utilized in the production of RCAs and chloropicrin:

1. Malononitrile (CAS 109-77-3)

2. 2-Chlorobenzaldehyde (CAS 89-98-5)

3. 2-Chlorobenzyl Alcohol (CAS 17849-38-6)

4. 2-Chlorobenzylamine (CAS 89-97-4)

5. Benzene, 1-chloro-2-(dimethoxymethyl) (CAS 70380-66-4)

6. Acetophenone (CAS 98-86-2)

7. Chloroacetyl Chloride (CAS 79-04-9)

8. Chloroform (CAS 67-66-3)

9. o-Aminophenol (CAS 95-55-6)

These expanded controls will supplement the existing CCL controls under ECCNs 1A984, 1C607, and 1C350. BIS estimates that these changes will result in an increase of ten license applications submitted to BIS annually.007

### B. Changes Related to Governments of Country Group A:5 and A:6 Destinations for Certain Exclusions, License Exception Eligibility, and Licensing Policy

This final rule makes the following changes to reduce the licensing burden on certain government entities located in Russia and Belarus by granting them the same eligibility for certain exclusions, license exceptions, and licensing policy as is currently available for private sector entities headquartered in Country Group A:5 and A:6 countries.

*1. Addition of license exception eligibility in § 746.8(c)(2)(vi) for official business of diplomatic or consular missions of the governments of Country Group A:5 and A:6 destinations*

In § 746.8, this final rule expands the scope of paragraph (c)(2)(vi) to add the phrase “or for the official business of diplomatic or consular missions of the governments of Country Group A:5 and A:6 destinations” that are operating in Russia or Belarus as entities eligible under this paragraph to receive items under License Exception Encryption commodities, software, and technology (ENC). In order to receive items under License Exception ENC, the export, reexport, or transfer (in-country) would also need to not be restricted under § 740.2 and meet all of the applicable terms and conditions of License Exception ENC under § 740.17. The addition of license exception eligibility for the embassies and consulates of Country Group A:5 and A:6 destinations is consistent with U.S. national security and foreign policy interests. BIS decided to make this change after reviewing a question from the public that asked whether License Exception ENC could be used for an export that otherwise met the terms of License Exception ENC for an export to an embassy for the official use of a Country Group A:5 and A:6 destination. Prior to this final rule, paragraph (c)(2) of § 746.8 would have excluded the use of License Exception ENC by such government entities.

BIS estimates that these changes will result in a decrease of five license applications submitted to BIS annually.

*2. Addition to exclusion in § 746.8(a)(12)(ii) for official business of diplomatic or consular missions of the governments of Country Group A:5 and A:6 destinations.*

                    In § 746.8(a)(12)(ii) (                    *Mass market encryption commodities and software, and software designated EAR99),*                     this final rule revises this paragraph to add a new exclusion under paragraph (a)(12)(ii)(F) to specify that exports, reexports, and transfers (in-country) for the official business of diplomatic or consular missions of the governments of Country Group A:5 and A:6 destinations that are operating in Russia or Belarus are also within the scope of this paragraph (a)(12) exclusion. This final rule also revises paragraph (a)(12)(ii)(D) to remove the word `or' and revises paragraph (a)(12)(E) to remove the period and add a semi-colon and the word `or' at the end of the paragraph to reflect the addition of new paragraph (a)(12)(ii)(F).                

*3. Addition of governments of Country Group A:5 and A:6 destinations to the case-by-case licensing policy under § 746.8(b)(3)(vi).*

                    In § 746.8(b)(3)(vi), this final rule revises the case-by-case licensing policy for license applications submitted pursuant to paragraphs (a)(1), (2), and (4) through (8) of this section, to add a new paragraph (b)(3)(vi)(F). With this revision, the case-by-case license review policy to determine whether the transaction in question would benefit the Russian or Belarusian government or defense sector will also apply to applications involving items destined for official business of governments of Country Group A:5 and A:6 destinations that are operating in Russia or Belarus. This final rule also revises paragraph (b)(3)(vi)(D) to remove the word `or' and revises paragraph (b)(3)(vi)(E) to remove                           ( print page 87281)                        the period and add a semi-colon and the word `or' at the end of the paragraph to reflect the addition of new paragraph (b)(3)(vi)(F).                

### C. Clarifying That the Entity List-Related FDP Rules License Requirement Extends to or Within Any Destination or to Any End User or Party That Otherwise Meets the Criteria

This final rule revises §§ 744.11 and 746.8 of the EAR to clarify that the three Entity List-related FDP rules' license requirements extend to or within any destination or to any end user or party. This final rule makes clarifying changes to § 744.11 by revising paragraphs (a)(2)(i) (Footnote 1 entities) and (a)(2)(iv) (Footnote 4 entities) to specify that parties may not, without a license, reexport, export from abroad, or transfer (in-country) to or within any destination or to any end user or party any foreign-produced item subject to the EAR pursuant to the referenced FDP rules under § 734.9(e)(1) or (2), respectively. Specifically, this final rule adds the phrase `to or within any destination or to any end user or party' to clarify the scope of this license requirement. This final rule makes the same clarifying revision in § 746.8(a)(3) (Russia/Belarus-Military End User and Procurement FDP rule) (Footnote 3 entities).

BIS estimates these changes described in section II.C will not result in any change to the number of license applications submitted to BIS annually.

#### Savings Clause

For the changes being made in this final rule, shipments of items removed from eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR) as a result of this regulatory action that were en route aboard a carrier to a port of export, reexport, or transfer (in-country), on November 1, 2024, pursuant to actual orders for export, reexport, or transfer (in-country) to or within a foreign destination, may proceed to that destination under the previous eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR), provided the export, reexport, or transfer (in-country) is completed no later than on December 2, 2024.

#### Export Control Reform Act of 2018

On August 13, 2018, the President signed into law the John S. McCain National Defense Authorization Act for Fiscal Year 2019, which included the Export Control Reform Act of 2018 (ECRA) (codified, as amended, at 50 U.S.C. 4801-4852). ECRA provides the legal basis for BIS's principal authorities and serves as the authority under which BIS issues this rule. In particular, and as noted elsewhere, Section 1753 of ECRA (50 U.S.C. 4812) authorizes the regulation of exports, reexports, and transfers (in-country) of items subject to U.S. jurisdiction. Further, Section 1754(a)(1)-(16) of ECRA (50 U.S.C. 4813(a)(1)-(16)) authorizes, inter alia: (1) the establishment of a list of controlled items; (2) the prohibition of unauthorized exports, reexports, and transfers (in-country); (3) the requirement of licenses or other authorizations for exports, reexports, and transfers (in-country) of controlled items; (4) the apprising of the public of changes in policy, regulations, and procedures; and (5) any other action necessary to carry out ECRA that is not otherwise prohibited by law. Pursuant to Section 1762(a) of ECRA (50 U.S.C. 4821(a)), these changes can be imposed in a final rule without prior notice and comment.

#### Rulemaking Requirements

                    1. BIS has examined the impact of this rule as required by Executive Orders (E.O.) 12866, 13563, and 14094, which 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 (                    *e.g.,*                     potential economic, environmental, public, health, and safety effects, distributive impacts, and equity). Pursuant to E.O. 12866, as amended, this final rule has not been determined to be a “significant regulatory action.”                

                    2. Notwithstanding any other provision of 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 Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501*et seq.*), unless that collection of information displays a currently valid Office of Management and Budget (OMB) Control Number. This rule involves the following OMB-approved collections of information subject to the PRA:                
    - 0694-0088, “Simple Network Application Process and Multipurpose Application Form,” which carries a burden hour estimate of 29.4 minutes for a manual or electronic submission;
    - 0694-0096 “Five Year Records Retention Period,” which carries a burden hour estimate of less than 1 minute for a manual or electronic submission; and
    - 0607-0152 “Automated Export System (AES) Program,” which carries a burden hour estimate of 3 minutes per electronic submission.

                    BIS estimates that these new controls on Russia and Belarus under the EAR will result in an increase of five license applications submitted annually to BIS. However, the additional burden falls within the existing estimates currently associated with these control numbers. Additional information regarding these collections of information—including all background materials—can be found at:                     *https://www.reginfo.gov/​public/​do/​PRAMain*                     by using the search function to enter either the title of the collection or the OMB Control Number.                

3. This rule does not contain policies with Federalism implications as that term is defined under E.O. 13132.

4. Pursuant to section 1762 of ECRA (50 U.S.C. 4821), this action is exempt from the Administrative Procedure Act (APA) (5 U.S.C. 553) requirements for notice of proposed rulemaking, opportunity for public participation, and delay in effective date. While section 1762 of ECRA provides sufficient authority for such an exemption, this action is also independently exempt from these APA requirements because it involves a military or foreign affairs function of the United States (5 U.S.C. 553(a)(1)).

                    5. Because neither the Administrative Procedure Act nor any other law requires that notice of proposed rulemaking and an opportunity for public comment be given for this rule, the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601*et seq.*) are not applicable. Accordingly, no Final Regulatory Flexibility Analysis is required, and none has been prepared.                

# List of Subjects

### 15 CFR Part 744

      - Exports
      - Reporting and recordkeeping requirements
      - Terrorism

### 15 CFR Part 746

      - Exports
      - Reporting and recordkeeping requirements

Accordingly, parts 744 and 746 of the Export Administration Regulations (15 CFR parts 730 through 774) are revised to read as follows:

# PART 744—END-USE AND END-USER CONTROLS 

1. The authority citation for part 744 continues to read as follows: 

Authority:50 U.S.C. 4801-4852; 50 U.S.C. 4601*et seq.;*50 U.S.C. 1701*et seq.;*22 U.S.C. 3201*et seq.;*42 U.S.C. 2139a; 22 U.S.C. 7201*et seq.;*22 U.S.C. 7210; E.O. 12058, 43 FR 20947, 3 CFR, 1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p.                                   ( print page 87282)                                608; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13099, 63 FR 45167, 3 CFR, 1998 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; Notice of November 8, 2022, 87 FR 68015, 3 CFR, 2022 Comp., p. 563; Notice of September 18, 2024, 89 FR 77011 (September 20, 2024).                        

2. Section 744.11 is amended by revising the first sentence of paragraph (a)(2)(i) and the first sentence of paragraph (a)(2)(iv) to read as follows: 

§ 744.11

* * * * *

(a) * * *

(2) * * *

                            (i)                             *Footnote 1 entities.*                             You may not, without a license or license exception, reexport, export from abroad, or transfer (in-country) to or within any destination or to any end user or party any foreign-produced item subject to the EAR pursuant to § 734.9(e)(1) of the EAR.                        

* * *

* * * * *

                            (iv)                             *Footnote 4 entities.*                             You may not, without a license, reexport, export from abroad, or transfer (in-country) to or within any destination or to any end user or party any foreign-produced item subject to the EAR pursuant to § 734.9(e)(2) of the EAR. * * *                        

* * * * *

# PART 746—EMBARGOES AND OTHER SPECIAL CONTROLS 

3. The authority citation for 15 CFR part 746 continues to read as follows:

Authority:50 U.S.C. 4801-4852; 50 U.S.C. 4601*et seq.;*50 U.S.C. 1701*et seq.;*22 U.S.C. 287c; Sec 1503, Pub. L. 108-11, 117 Stat. 559; 22 U.S.C. 2151 note; 22 U.S.C. 6004; 22 U.S.C. 7201*et seq.;*22 U.S.C. 7210; E.O. 12854, 58 FR 36587, 3 CFR, 1993 Comp., p. 614; E.O. 12918, 59 FR 28205, 3 CFR, 1994 Comp., p. 899; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13338, 69 FR 26751, 3 CFR, 2004 Comp., p 168; Presidential Determination 2003-23, 68 FR 26459, 3 CFR, 2004 Comp., p. 320; Presidential Determination 2007-7, 72 FR 1899, 3 CFR, 2006 Comp., p. 325; Notice of May 8, 2024, 89 FR 40355 (May 9, 2024).                        

4. Section 746.8 is amended by: 

a. Revising paragraphs (a)(3), (a)(12)(ii)(D) and (E); 

b. Adding paragraph (a)(12)(ii)(F); 

c. Revising paragraphs (b)(3)(vi)(D) and (E); 

d. Adding paragraph (b)(3)(vi)(F); and 

e. Revising paragraph (c)(2)(vi). 

The additions and revisions read as follows:

§ 746.8

(a) * * *

* * * * *

                            (3)                             *Russia/Belarus-Military End User and Procurement FDP rule.*                             A license is required to reexport, export from abroad, or transfer (in-country) to or within any destination or to any end user or party any foreign-produced item subject to the EAR under § 734.9(g) of the EAR.                        

* * * * *

(12) * * *

(ii) * * *

(D) Wholly owned subsidiaries, branches, or sales offices of companies headquartered in countries from Country Group A:5 and A:6 in supplement no. 1 to part 740;

                            (E) Joint ventures between two or more companies headquartered in Country Group A:5 and A:6 in supplement no. 1 to part 740, including the wholly owned subsidiaries, branches, or sales offices of such joint ventures;                             *or*

(F) For official business of diplomatic or consular missions of the governments of Country Group A:5 and A:6 destinations.

* * * * *

(b) * * *

(3) * * *

(vi) * * *

(D) The wholly owned subsidiaries, branches, or sales offices of companies headquartered in countries from Country Group A:5 and A:6 in supplement no. 1 to part 740;

                            (E) Joint ventures of companies headquartered in Country Groups A:5 and A:6 with other companies headquartered in Country Groups A:5 and A:6;                             *or*

(F) For official business of governments of Country Group A:5 and A:6 destinations.

(vii) Applications for companies headquartered in Country Groups A:5 and A:6 to support civil telecommunications infrastructure.

* * * * *

(c) * * *

(2) * * *

(vi) License Exception Encryption commodities, software, and technology (ENC) for civil end-users that are wholly-owned U.S. subsidiaries, branches, or sales offices; foreign subsidiaries, branches, or sales offices of U.S. companies that are joint ventures with other U.S. companies; joint ventures of U.S. companies with companies headquartered in countries from Country Group A:5 and A:6 in supplement no. 1 to part 740 of the EAR countries; the wholly-owned subsidiaries, branches, or sales offices of companies headquartered in countries from Country Group A:5 and A:6 in supplement no. 1 to part 740; joint ventures of companies headquartered in Country Group A:5 and A:6 with other companies headquartered in Country Groups A:5 and A:6; or for official business of diplomatic or consular missions of the governments of Country Group A:5 and A:6 destinations (§§ 740.13(c) and 740.17 of the EAR).

5. Supplement no. 6 to part 746 is amended by adding paragraph (i) to read as follows: 

## Supplement No. 6 to Part 746—Russian and Belarusian Industry Sector Sanctions Pursuant to § 746.8(a)(6)

(i) Pre-cursors for riot control agents and chloropicrin as follows:

(1) Malononitrile (CAS 109-77-3);

(2) 2-Chlorobenzaldehyde (CAS 89-98-5);

(3) 2-Chlorobenzyl Alcohol (CAS 17849-38-6);

(4) 2-Chlorobenzylamine (CAS 89-97-4);

(5) Benzene, 1-chloro-2-(dimethoxymethyl) (CAS 70380-66-4);

(6) Acetophenone (CAS 98-86-2);

*(7) C*                            hloroacetyl Chloride (CAS 79-04-9);                        

                            (8) Chloroform (CAS 67-66-3);                             *and*

(9) o-Aminophenol (CAS 95-55-6).

Matthew S. Borman,

Principal Deputy Assistant Secretary for Strategic Trade and Technology Security.

[FR Doc. 2024-25445 Filed 10-30-24; 8:45 am]

BILLING CODE 3510-JT-P