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[Federal Register Volume 75, Number 236 (Thursday, December 9, 2010)]
[Proposed Rules]
[Pages 76653-76664]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-30968]

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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR Parts 732, 738, 740, 743, 758, and 774

[Docket No. 100923470-0569-01]
RIN 0694-AF03

Export Control Modernization: Strategic Trade Authorization 
License Exception

AGENCY: Bureau of Industry and Security, Commerce.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would add a new license exception to the 
Export Administration Regulations (EAR). The exception would allow 
exports, reexports and transfers (in-country) of specified items to 
destinations that pose little risk of unauthorized use of those items. 
To provide assurance against diversion to unauthorized destinations, 
transactions under this license exception would be subject to 
notification, destination control statement and consignee statement 
requirements. This proposed rule is part of the Administration's Export 
Control Reform Initiative undertaken as a result of the fundamental 
review of the U.S. export control system announced by the President in 
August 2009.

DATES: Comments must be received by BIS no later than February 7, 2011.

ADDRESSES: Comments on this rule may be submitted to the Federal 
rulemaking portal (http://www.regulations.gov). The regulations.gov ID 
for this rule is: BIS-2010-0038. Comments may also be

[[Page 76654]]

submitted via e-mail to publiccomments.bis.doc.gov or on paper to 
Regulatory Policy Division, Bureau of Industry and Security, Room 2705, 
U.S. Department of Commerce, Washington, DC 20230. Please refer to RIN 
0694-AF03 in all comments and in the subject line of e-mail comments.

FOR FURTHER INFORMATION CONTACT: William Arvin, Regulatory Policy 
Division, Bureau of Industry and Security, warvin@bis.doc.gov or 202-
482-2440.

SUPPLEMENTARY INFORMATION: 

Background

    In August 2009, the President directed a broad-based interagency 
review of the U.S. export control system with the goal of strengthening 
national security and the competitiveness of key U.S. manufacturing and 
technology sectors by focusing on current threats and adapting to the 
changing economic and technological landscape. The review determined 
that the current export control system is overly complicated, contains 
too many redundancies, and, in trying to protect too much, diminishes 
our ability to focus our efforts on the most critical national security 
priorities. See, e.g., October 30, 2010 press release by the White 
House, Office of the Press Secretary at http://www.whitehouse.gov/the-press-office/2010/08/30/president-obama-lays-foundation-a-new-export-control-system-strengthen-n.
    As a result, the Administration has begun the Export Control Reform 
Initiative, which will fundamentally reform the U.S. export control 
system. The Export Control Reform Initiative is designed to enhance 
U.S. national security and strengthen the United States' ability to 
counter threats such as the proliferation of weapons of mass 
destruction. The Administration determined that fundamental reform is 
needed in each of the export control system's four component areas with 
transformation to a single control list, a single licensing agency, a 
single information technology system, and a single primary enforcement 
coordination agency. The Administration is implementing the reform in 
three phases. The first two phases build toward the third phase of the 
single control list, licensing agency, information technology system, 
and enforcement coordination agency. Under this approach, new criteria 
for determining what items need to be controlled and a common set of 
policies for determining when an export license is required will be 
implemented. The control list criteria will be based on transparent 
rules, which will reduce the uncertainty faced by our allies, U.S. 
industry, and its foreign partners, and will allow the government to 
erect higher walls around the most sensitive items in order to enhance 
national security.

A New License Exception To Begin a More Precise Focus

    This proposed rule would implement one part of the reform 
initiative. It would revise licensing policies by creating a new 
license exception for transactions involving certain items subject to 
the Export Administration Regulations (EAR) to certain destinations. 
The new License Exception Strategic Trade Authorization (STA) would be 
in Sec.  740.20 of the EAR.
    The new license exception would authorize exports, reexports and 
transfers (in-country) to destinations that pose little risk of 
unauthorized uses, and for which U.S. national security and foreign 
policy justify authorizing transactions without the delay and expense 
of obtaining an export license. To provide safeguards against possible 
reexports to destinations that are not authorized under License 
Exception STA, where there is a greater risk of diversion to 
unauthorized end-uses, the license exception would also impose certain 
notification, destination control statement and consignee statement 
requirements. Use of this license exception would be optional. Parties 
would be free to use other license exceptions that would authorize a 
planned transaction or to apply for a license if they prefer to do so.
    This license exception would be a step in the President's Export 
Control Reform Initiative. With its associated specific safeguards, 
this license exception would further focus export controls on the most 
critical national security priorities. The Administration will continue 
to work on other parts of the initiative, including implementing the 
control list criteria and transitioning the Commerce Control List (CCL) 
into a tiered structure to further target dual-use controls on the most 
sensitive items.
    As described in the Notice of Inquiry the Department of Commerce 
entitled ``Request for Public Comments on How the Descriptions of Items 
on the Commerce Control List Could be (1) More Clear and `Positive' and 
(2) `Tiered' based on Their (a) Significance and (b) Availability 
Outside of Certain Countries'' issued simultaneously with this proposed 
rule, the Administration is continuing its review of items on the CCL 
to determine which paragraphs or subparagraphs within each Export 
Control Classification Number (ECCN) should be identified as within the 
scope of Tier 1, Tier 2, or Tier 3. Any items the Administration 
ultimately determines to be within the scope of Tier 1--i.e., items 
that are critical to maintaining a military or intelligence advantage 
for the United States and almost exclusively available from the United 
States--will not be within the scope of License Exception STA. In 
particular, the Administration is focusing on whether items within the 
scope of the following ECCNs would, in whole or in part, not be 
eligible for License Exception STA: 0A919, 1A002, 3A001, 3A002, 3A003, 
3A201, 3A228, 3A229, 3A232, 4A001, 4A003, 5A001, 6A001, 6A002, 6A003, 
6A004, 6A005, 6A006, 7A001, 7A002, 7A003, 7A004, 7A006, 8A001, 8A018, 
9A001, 9A004, 9A012 and 9A018. The Administration's focus on these 
ECCNs includes a focus on whether the technology controls related to 
such items and other items, such as in ECCNs 9E003, 6E001 and 6E002, 
meet, in whole or in part, the Tier 1 criteria.

Specific License Exception Provisions

Scope

    The license exception would apply only to Commerce Control List-
based license requirements. Transactions in which a license is required 
because of an end-use--such as a proliferation end-use described in 
part 744 of the EAR or a proscribed end-user (such as a party on the 
Entity List in part 744 of the EAR)--or because the destination is 
subject to an embargo or special restrictions in part 746 of the EAR, 
would not be eligible for License Exception STA.
    Items on the Commerce Control List that are subject to the short 
supply (SS), surreptitious listening (SL), missile technology (MT) or 
chemical weapons (CW) reasons for control would not be eligible for 
License Exception STA because of various requirements imposed by 
statutes, treaties or U.S. implementation of international commitments. 
Items in ECCNs 0A981 and 0A983 also would not be eligible. Those two 
ECCNs apply to equipment designed for the execution of human beings and 
specially designed implements of torture. The human rights concerns 
associated with those items are sufficiently great to justify 
precluding use of License Exception STA. License Exception STA would 
also not affect the requirements for License Exception ENC in Sec.  
740.17 of the EAR.

[[Page 76655]]

License Exception STA

    This license exception would encompass three different 
authorizations, based on the reason(s) for control underlying the 
license requirements that would apply to the item in the particular 
transaction at issue, the destination, the sensitivity of the item and 
the end-use. One authorization would allow items subject to any (or 
all) of seven reasons for control to go to 37 destinations. Another 
authorization would allow less sensitive items subject to only national 
security reasons for control to go to two additional destinations. The 
third authorization would allow less sensitive items subject to only 
national security reasons for control to go to 125 additional 
destinations for civil end-uses. National security-controlled items 
that are ineligible for the last two authorizations would be identified 
by the new ``STA exclusion paragraphs'' in the ``License Exceptions'' 
sections of 50 ECCN entries on the Commerce Control List. Thus, the STA 
exclusion serves the opposite function of a typical list-based license 
exception paragraph, such as those setting forth license exceptions LVS 
(Sec.  740.3) and GBS (Sec.  740.4), which identifies items that are 
eligible for a license exception.

Authorization for Items Controlled for Multiple Reasons to 37 Countries

    If the only reason(s) for control that impose(s) a license 
requirement on the transaction is (are) national security (NS); 
chemical or biological weapons (CB); nuclear nonproliferation (NP); 
regional stability (RS); encryption items (EI); crime control (CC) (but 
not ECCNs 0A981, 0A982, 0A983, 0A985 or 0E982); or significant items 
(SI), exports, reexports and transfers (in-country) to 37 destinations 
would be authorized. Two of the crime control ECCNs excluded from this 
authorization (0A981 and 0A983) involve human rights concerns of 
sufficient magnitude to justify exclusion. The other three excluded 
crime control ECCNs would continue to require a license to all 
destinations other than Canada.

Authorization for Less Sensitive National Security Items to 2 
Additional Countries

    If the only reason for control that imposes a license requirement 
on the transaction is national security (NS) and the item is not 
designated in the STA sensitive items exclusion paragraph in its ECCN, 
two destinations in addition to the 37 noted above would be authorized. 
The STA exclusion paragraphs closely track the Sensitive List of the 
Wassenaar Arrangement on Export Controls Conventional Arms and Dual-Use 
Goods and Technologies (Wassenaar Arrangement). This rule would add 
such paragraphs to 50 ECCNs.

Authorization for Less Sensitive National Security Items for Civil End-
uses in 125 Additional Countries

    If the only reason for control that imposes a license requirement 
on the transaction is national security (NS), the item that is the 
subject of the transaction is not designated by the STA exclusion 
paragraph in its ECCN and the item is being exported, reexported or 
transferred (in-country) for a civil end-use, 125 additional 
destinations would be authorized. Civil end-use is defined as an end-
use that is not a military end-use as defined by Sec.  744.21(f) or a 
proliferation activity described and prohibited by part 744 of the EAR.

Limitations on Subsequent Transactions That Apply to License Exception 
STA

    Proposed Sec.  740.20 would preclude use of License Exception APR 
paragraph (a) (Sec.  740.16(a)) for items that have been shipped 
pursuant to this License Exception STA.

Conditions That Apply to License Exception STA

    Proposed Sec.  740.20 would impose three conditions that would 
apply to transactions made pursuant to License Exception STA.
    (1) Exporters would be required to furnish the consignee with the 
ECCN that applies to each item transferred under License Exception STA.
    (2) Reexporters and transferors would be required to provide 
subsequent consignees with the ECCN provided by the exporter or prior 
reexporters or transferors.
    (3) Exporters, reexporters and transferors would be required to 
obtain from their consignees, prior to the shipment, a written 
statement identifying the items to be shipped and restating the ECCN(s) 
provided to the consignees by the exporters, reexporters or 
transferors. The statement must also acknowledge that the consignee:
     Is aware that items will be shipped pursuant to License 
Exception STA;
     Has been informed of the description of the items and 
their ECCN(s) by the exporter, reexporter or transferor;
     Understands that shipment pursuant to License Exception 
STA precludes subsequent use of paragraph (a) of License Exception APR 
for the items;
     Agrees not to export, reexport or transfer these items to 
any destination, enduse or end-user prohibited by the EAR;
     Agrees that, for items subject to a civil end-use 
restriction, the only end-use of the items will be civil; and
     Agrees to provide copies of this document and all other 
export, reexport or transfer record (i.e., the documents described in 
part 762 of the EAR) relevant to the items referenced in this statement 
to the U.S. Government as set forth in Sec.  762.7.
    (4) Exporters, reexporters and transferors using License Exception 
STA would be required to use a special destination control statement 
that applies to shipments made pursuant to License Exception STA. Like 
the destination control statement requirement that currently applies to 
most exports of items listed in specific entries on the Commerce 
Control List, the destination control statement that applies to License 
Exception STA would have to be placed on documents that accompany the 
shipment. Unlike the current destination control statement, this new 
destination control statement would apply to reexports and transfers 
(in-country) abroad. In addition to noting that the shipment is subject 
to the EAR and that any further disposition must be in accordance with 
those regulations, this new destination control statement would include 
the ECCN applicable to each item, explicitly state that the shipment is 
being made pursuant to License Exception STA and explicitly state that 
subsequent exports or reexports under paragraph (a) of License 
Exception APR are prohibited.

Addition of License Exception STA Exclusion Paragraphs to 50 ECCNs

    As noted above, this rule adds such paragraphs to 50 ECCNs. The STA 
exclusion paragraphs, which closely track the Wassenaar Arrangement 
Sensitive List, designate certain items that would not be eligible for 
License Exception STA other than for the 37 destinations set forth in 
proposed Sec.  740.20(c)(1).

Incidental Changes Necessary to Implement License Exception STA

Cross Reference to Wassenaar Arrangement Reporting Requirements

    New Sec.  740.20 would cross reference the Wassenaar Arrangement 
reporting requirements in Sec.  743.1 of the EAR because Wassenaar 
Arrangement Sensitive List items exported pursuant to License Exception 
STA would be subject to the reporting requirements of Sec.  743.1.

[[Page 76656]]

Revisions to Sec.  732.4

    Section 732.4 of the EAR explains how to identify and use license 
exceptions. This proposed rule would revise that section to note the 
License Exception STA exclusion paragraphs in ECCNs and to add License 
Exception STA to the list of license exceptions that are subject to the 
Wassenaar Arrangement reporting requirements of Sec.  743.1 of the EAR.

Revision to Sec.  738.2(d)(2)(i) Explaining the Use of the License 
Exception STA Exclusion Paragraphs in ECCNs

    Section 738.2 of the EAR explains the workings of the Commerce 
Control List, and paragraph (d)(2)(i) of that section explains the 
``License Exception'' paragraph of an ECCN. This proposed rule would 
revise that paragraph to explain the role of the STA exclusion 
paragraphs, which is different from that of the other license exception 
paragraphs that appear in ECCNs. The other license exception paragraphs 
signal eligibility to use a license exception and the limits of that 
eligibility. The STA exclusion paragraphs signal that two authorizing 
paragraphs of License Exception STA may not be used.

Revision to Sec.  743.1 Wassenaar Arrangement Reporting

    Wassenaar Arrangement member states, including the United States, 
are required to report to the Wassenaar Arrangement exports of 
Sensitive List items to non-member states for which a license was not 
issued. Section 743.1 of the EAR requires exporters using certain 
license exceptions for such exports to report the export to BIS. The 
information reported by the exporters is used to compile the report 
that the United States submits to the Wassenaar Arrangement. To enable 
the United States to meet its reporting obligations to the Wassenaar 
Arrangement, this proposed rule would add License Exception STA to 
Sec.  743.1.

Revision to Sec.  758.6

    Section 758.6 of the EAR imposes a destination control statement 
that applies to exports of all items subject to the EAR that are not 
classified as EAR99, i.e., to all items that are not controlled under a 
specific entry on the Commerce Control List. This rule would add 
language to Sec.  758.6 to alert readers that transactions authorized 
by License Exception STA are subject to the destination control 
statement found in Sec.  740.20(d)(3).

Rulemaking Requirements

    1. This rule has been determined to be significant for purposes of 
Executive Order 12866.
    2. Notwithstanding any other provision of law, no person is 
required to respond to, nor is subject to a penalty for failure to 
comply with, a collection of information, subject to the requirements 
of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) (PRA), 
unless that collection of information displays a currently valid Office 
of Management and Budget (OMB) Control Number.
    The proposed rule would affect a collection of information approved 
by OMB under control number 0607-0152 (the Automated Export System or 
AES). That collection is administered by the Census Bureau. For most 
exports of items subject to the EAR, the export license number, a 
license exception symbol or the designator NLR (no license required) 
must be entered into AES. BIS believes that this rule, if implemented 
in final form, would have no material impact on the burden imposed by 
that collection because this rule would, in effect, merely replace an 
existing requirement to enter the license number with a requirement to 
enter a license exception symbol instead.
    This rule also amends a collection of information approved by OMB 
under control number 0694-0137 (License Exemptions and Exclusions). 
This control number is being amended to add the proposed requirement 
for exporters, reexporters and transferors to furnish ECCNs, to prepare 
and furnish a revised destination control statement and to obtain a 
statement of assurance from the consignee before shipping pursuant to 
the license exception that would be created by this rule. BIS expects 
the requirements are likely to increase the burden associated with 
control number 0694-0137 by about 3,200 hours (3,200 transactions @ 1 
hour each). BIS believes that, in most instances, this new burden will 
be wholly or partially offset by a reduction in burden under control 
number 0694-0088 (Simplified Network Application Processing System) 
which authorizes, among other things, export license applications.
    3. This rule does not contain policies with Federalism implications 
as that term is defined under E.O. 13132.
    4. The Chief Counsel for Regulations 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.

Number of Small Entities

    Currently, BIS does not collect data on the size of entities that 
currently apply for and are issued export licenses. Although BIS is 
unable to estimate the exact number of small entities that would be 
impacted by this rule, it does acknowledge that this rule will impact 
some unknown number.

Economic Impact

    BIS believes that this rule would reduce the costs to small 
entities because it would provide an alternative to existing license 
requirements. Small entities (and all other entities) would be able to 
choose to: (1) Comply with the safeguard provisions of the license 
exception that would be created by this rule; (2) continue to apply for 
licenses before engaging in the transactions that would be affected by 
this rule; or (3) use any other license exception in the EAR that 
authorizes a particular transaction.
    BIS believes that in many instances, small entities will elect to 
comply with the safeguard provisions and use the license exception that 
would be created by this rule because they are likely to find doing so 
less costly than the requirements of applying for and obtaining an 
export license as is currently required for most transactions that 
would be affected by this rule.
    Obtaining an export license requires submitting a detailed product 
description and the names, addresses and contact information about most 
parties to the transaction. Moreover, the applicant is unable to engage 
in the transaction until it receives approval from the government to do 
so and thus incurs the costs associated with uncertainty and delay 
before it can make a sale. In many instances, approval is granted only 
with conditions that may impose notification requirements or end-use 
restrictions. In some instances, the applicant must also obtain an 
import or end-user certificate from its proposed consignee, a document 
that the consignee must obtain from its government. In other instances, 
the applicant must obtain a written statement from the proposed 
consignee describing the transactions and providing assurance that it 
will not reship the items in violation of the EAR.
    Under the license exception proposed in this rule, the party 
wishing to ship the item need not contact BIS prior to the shipment for 
export control purposes. Instead, that party would inform its proposed 
consignee of the description of the items being exported, the ECCN 
under which they are classified and a standard set of restrictions on 
further shipments of the

[[Page 76657]]

items. The party may proceed with the transaction once it has obtained 
from its consignee a statement that includes: (1) A written 
acknowledgement of the receipt of that information; (2) a commitment to 
comply with the EAR; and (3) a commitment to furnish information about 
the transaction to the United States Government upon request.
    Exporters of certain items that are subject to national security 
export controls would be required to report the transaction to BIS 
after the export takes place if the item is exported to a destination 
that is not a member of the Wassenaar Arrangement. However, currently 
such exports must be made pursuant to either an existing license 
exception or as authorized by a license. If the export is made pursuant 
to an existing license exception, it is already subject to this post-
shipment reporting requirement so exporters who switch from an existing 
license exception to this new license exception would incur no new or 
increased burden as a result of this post-shipment reporting 
requirement. If an export currently is made as authorized, the exporter 
who elects to use this new license exception would be exchanging the 
burden of applying for a license and waiting to learn the results for 
the burden of submitting a post-shipment report.

Conclusion

    BIS is unable to determine whether there are a substantial number 
of small entities affected by this rule. However, the effect of this 
rule on all entities is not likely to be a significant economic impact. 
In some instances, parties shipping under the license exception that 
this rule would create would be required to obtain documents from their 
consignees that they are not currently required to obtain. In some 
instances, parties shipping under the license exception that this rule 
would create would be required to provide a post-shipment report that 
they are not currently required to provide. However, any increase in 
costs arising from those two requirements is likely to be offset by the 
fact that parties who elect to use License Exception STA would no 
longer be required to submit detailed information to the government in 
advance and wait for authorization before proceeding. Moreover the fact 
that parties may elect to: (1) Use the new License Exception STA that 
would be created by this rule, (2) use any existing license exception 
that authorizes the transaction, or (3) comply with existing license 
requirements provides substantial assurance that the safeguards 
requirements of the new license exception would not be applied except 
in instances in which the party that wishes to transfer the items 
believes that those safeguard procedures impose a lesser cost than does 
any available existing license exception or the existing license 
procedure.
    For the reasons above, the Chief Counsel for Regulation certified 
that this rule would not have a significant economic impact on a 
substantial number of small entities.

List of Subjects

15 CFR Parts 732, 740, and 758

    Administrative practice and procedure, Exports, Reporting and 
recordkeeping requirements.

15 CFR Part 738

    Exports.

15 CFR Part 743

    Administrative practice and procedure, Reporting and recordkeeping 
requirements.

15 CFR Part 774

    Exports, Reporting and recordkeeping requirements.

    Accordingly, the Export Administration Regulations (15 CFR parts 
730-774) are proposed to be amended as follows:

PART 732--[AMENDED]

    1. 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 12, 2010, 75 
FR 50681 (August 16, 2010).

    2. Section 732.4 is amended by:
    a. Adding two sentences immediately following the existing third 
sentence in paragraph (b)(3)(iii); and
    b. Revising paragraph (b)(3)(iv) to read as follows:

Sec.  732.4  Steps regarding License Exceptions.

* * * * *
    (b) * * *
    (iii) * * * Some ECCNs contain License Exception STA exclusion 
paragraphs. Those paragraphs delineate items excluded from the License 
Exception STA provisions in Sec.  740.20(c)(2) of the EAR. * * *
    (iv) If you are exporting under License Exceptions GBS, CIV, LVS, 
STA, APP, TSR or GOV, you should review Sec.  743.1 of the EAR to 
determine the applicability of certain reporting requirements.
* * * * *

PART 738--[AMENDED]

    3. The authority citation for 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 12, 2010, 75 FR 50681 (August 16, 2010).

    4. Section 738.2 is amended by adding two sentences immediately 
following the existing third sentence in paragraph (d)(2)(ii) to read 
as follows:

Sec.  738.2  Commerce Control List structure.

* * * * *
    (d) * * *
    (2) * * *
    (ii) * * * Some ECCNs have License Exception STA exclusion 
paragraphs. These paragraphs identify items for which the License 
Exception STA provisions in Sec.  740.20(c)(2)(i) and (ii) of the EAR 
may not be used, but do not otherwise affect License Exception STA 
availability. * * *
* * * * *

PART 740--[AMENDED]

    5. The authority citation for part 740 continues to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
22 U.S.C. 7201 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 12, 2010, 75 FR 50681 (August 16, 2010).

    6. Add Sec.  740.20 to read as follows:

Sec.  740.20  License Exception Strategic Trade Authorization (STA).

    (a) Introduction. This section authorizes exports, reexports and 
transfers (in-country) in lieu of a license that would otherwise be 
required pursuant to part 742 of the EAR. In this section, the term 
``transaction'' means exports, reexports and transfers (in-country).
    (b) Requirements and limitations--(1) Requirements for using 
License Exception STA. (i) All of the reasons for control that impose a 
part 742 license requirement on the transaction must be addressed in at 
least one authorizing paragraph of this section.
    (ii) The party using License Exception STA must comply with all of 
the requirements in paragraph (d) of this section.
    (2) Limitations on use of License Exception STA. (i) License 
Exception STA may not be used in lieu of any

[[Page 76658]]

license requirement imposed by: ``Part 744--Control Policy: End User 
and End Use Based'' or by ``Part 746--Embargoes and other Special 
Controls'' of the EAR.
    (ii) License Exception STA may not be used for any transaction 
involving an item controlled under ECCNs 0A981 or 0A983.
    (iii) License Exception STA may not be used for any transaction 
involving an item that is controlled for reason of short supply (SS), 
surreptitious listening (SL), missile technology (MT) or chemical 
weapons (CW).
    (iv) License Exception STA may not be used for any transaction 
involving an item identified on the CCL as being subject to the export 
control jurisdiction of another agency, such as the Department of 
State, the Department of Energy, or the Nuclear Regulatory Commission.
    (c) Authorizing paragraphs--(1) Transactions subject to multiple 
reasons for control. Transactions in which the only applicable 
reason(s) for control is (are): National security (NS); chemical or 
biological weapons (CB); nuclear nonproliferation (NP); regional 
stability (RS); encryption items (EI); crime control (CC), but not 
ECCNs 0A981, 0A982, 0A983, 0A985 or 0E982; and/or significant items 
(SI) are authorized for destinations in: Argentina, Australia, Austria, 
Belgium, Bulgaria, Canada, Croatia, Czech Republic, Denmark, Estonia, 
Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, 
Japan, Latvia, Lithuania, Luxembourg, Netherlands, New Zealand, Norway, 
Poland, Portugal, Romania, Slovakia, Slovenia, South Korea, Spain, 
Sweden, Switzerland, Turkey, Ukraine and the United Kingdom.
    (2) Transactions subject to national security controls of lesser 
sensitivity. Transactions in which the only applicable reason for 
control is national security (NS) and the item being exported, 
reexported or transferred (in-country) is not designated in the ``STA 
exclusion'' paragraph in the ECCN that lists the item are authorized 
if:
    (i) The destination is in Albania or Israel; or
    (ii) The item is being exported, reexported or transferred (in-
country) for a civil end-use and the destination is in Algeria, 
Andorra, Antigua and Barbuda, Armenia, Aruba, Azerbaijan, Bahamas, 
Bahrain, Bangladesh, Barbados, Belize, Benin, Bhutan, Bolivia, Bosnia 
and Herzegovina, Botswana, Brazil, Brunei, Burkina Faso, Burundi, 
Cambodia, Cameroon, Cape Verde, Central African Republic, Chad, Chile, 
Colombia, Comoros, Congo (Republic of the), Costa Rica, Djibouti, 
Dominica, Dominican Republic, East Timor, Ecuador, El Salvador, 
Equatorial Guinea, Ethiopia, Fiji, Gabon, Gambia (The), Georgia, Ghana, 
Grenada, Guatemala, Guinea, Guinea-Bissau, Guyana, Honduras, Hong Kong, 
India, Jamaica, Jordan, Kazakhstan, Kenya, Kiribati, Kosovo, Kuwait, 
Kyrgyzstan, Laos, Lesotho, Liechtenstein, Macedonia (Former Yugoslav 
Republic), Madagascar, Malawi, Maldives, Mali, Malta, Marshall Islands, 
Mauritania, Mauritius, Mexico, Micronesia (Federated States of), 
Moldova, Monaco, Mongolia, Montenegro, Morocco, Mozambique, Namibia, 
Nauru, Nepal, Netherlands Antilles, Nicaragua, Niger, Nigeria, Oman, 
Palau, Panama, Papua New Guinea, Paraguay, Peru, Philippines, Qatar, 
Rwanda, Saint Kitts & Nevis, Saint Lucia, Saint Vincent and the 
Grenadines, Samoa, San Marino, Sao Tome & Principe, Saudi Arabia, 
Senegal, Seychelles, Singapore, Solomon Islands, South Africa, Surinam, 
Swaziland, Taiwan, Tajikistan, Tanzania, Thailand, Togo, Tonga, 
Trinidad & Tobago, Tunisia, Turkmenistan, Tuvalu, Uruguay, Uzbekistan, 
Vanuatu, Vatican City, Western Sahara and Zambia. For purposes of this 
section, civil end-use means an end-use other than a military end-use 
as defined in section 744.21(f) or a proliferation activity described 
and prohibited by part 744 of the EAR.
    (d) Conditions--(1) Requirement to furnish Export Control 
Classification Number. (i) The exporter must furnish to the consignee 
the Export Control Classification Number of each item to be shipped 
pursuant to this section.
    (ii) A reexporter or transferor must furnish to subsequent 
consignees the Export Control Classification Number, provided by the 
exporter or a prior reexporter or transferor, of each item to be 
shipped pursuant to this section.
    (2) Prior Consignee Statement. The exporter, reexporter or 
transferor must obtain the following statement in writing from its 
consignee prior to shipping the item and must retain the statement in 
accordance with part 762 of the EAR.
    [INSERT NAME OF CONSIGNEE]:
    (i) Is aware that [INSERT DESCRIPTION AND APPLICABLE ECCNS OF ITEMS 
TO BE SHIPPED] will be shipped pursuant to License Exception Strategic 
Trade Authorization (STA) in Sec.  740.20 of the United States Export 
Administration Regulations (15 CFR 740.20);
    (ii) Has been informed of the ECCNs noted above by [INSERT NAME OF 
EXPORTER, REEXPORTER OR TRANSFEROR];
    (iii) Understands that items shipped pursuant to License Exception 
STA may not subsequently be reexported pursuant to paragraph (a) of 
License Exception APR (15 CFR 740.16(a));
    (iv) Agrees not to export, reexport or transfer these items to any 
destination, use or user prohibited by the United States Export 
Administration Regulations;
    (v) Agrees that the items shipped pursuant to Sec.  
740.20(c)(1)(ii) will only be used in a civil end-use; and
    (vi) Agrees to provide copies of this document and all other 
export, reexport or transfer record (i.e., the documents described in 
15 CFR part 762) relevant to the items referenced in this statement to 
the U.S. Government as set forth in 15 CFR 762.7.
    (3) Destination Control Statement. The Destination Control 
Statement (DCS) must be entered by the exporter, reexporter or 
transferor on the invoice and on any other ``export control document'' 
that accompanies the shipment from its point of origin to the ultimate 
consignee or end-user for all export, reexports and transfers (in-
country) made pursuant to License Exception STA. The person responsible 
for preparation of those documents is responsible for entry of the DCS. 
The DCS is required for all exports, reexports and transfers (in-
country) made pursuant to this section. At a minimum, the DCS must 
state:
    [INSERT NAME AND APPLICABLE ECCN FOR EACH ITEM INCLUDED IN THE 
SHIPMENT]
    These commodities, technology or software are subject to the Export 
Administration Regulations (15 CFR 730-774) and were exported from the 
United States or reexported or transferred in accordance with License 
Exception Strategic Trade Authorization (STA). Any further reexport or 
transfer must be in accordance with the Export Administration 
Regulations. Paragraph (a) of License Exception APR (15 CFR 740.16(a)), 
which permits reexports from certain countries without additional U.S. 
Government authorization, may not be used as an authorization for any 
transactions involving these items.
    (e) Limitation on subsequent transactions. If an item has been 
exported, reexported or transferred (in-country) pursuant to this 
section, it may not be subsequently exported, reexported or transferred 
(in-country) pursuant to paragraph (a) of License Exception APR (Sec.  
740.16(a) of the EAR).
    (f) Applicability of Wassenaar Arrangement reporting requirements. 
See Sec.  743.1 of the EAR for special reporting requirements that 
apply to some exports made pursuant to this section.

[[Page 76659]]

PART 743--[AMENDED]

    7. 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; Notice of August 
12, 2010, 75 FR 50681 (August 16, 2010).

    8. Section 743.1 is amended by adding a paragraph (b)(4) to read as 
follows:

Sec.  743.1  Wassenaar Arrangement.

* * * * *
    (b) * * *
    (4) Exports authorized under License Exception STA (See Sec.  
740.20 of the EAR).
* * * * *

PART 758--[AMENDED]

    9. The authority citation for part 758 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 
12, 2010, 75 FR 50681 (August 16, 2010).

    10. Section 758.6 is amended by adding a sentence at the end of the 
section to read as follows:

Sec.  758.6  Destination control statement.

    * * * In addition to the destination control statement in this 
section, the destination control statement requirements of Sec.  
740.20(d)(3) of the EAR apply to exports, reexports and transfers (in-
country) made pursuant to License Exception Strategic Trade 
Authorization (STA).

PART 774--[AMENDED]

    11. 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 12, 2010, 75 FR 50681 (August 16, 2010).

    12. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 1, ECCN 1A002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

Supplement No. 1 to Part 774--The Commerce Control List

* * * * *
    1A002 ``Composite'' structures or laminates, having any of the 
following (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any item in this entry.
* * * * *

    13. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 1, ECCN 1C001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    1C001 Materials specially designed for use as absorbers of 
electromagnetic waves, or intrinsically conductive polymers, as 
follows (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any item in this entry.
* * * * *

    14. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 1, ECCN 1C007 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    1C007 Ceramic base materials, non-``composite'' ceramic 
materials, ceramic-``matrix'' ``composite'' materials and precursor 
materials, as follows (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any item in 1C007.c or 
d.
* * * * *

    15. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 1, ECCN 1C010 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    1C010 ``Fibrous or filamentary materials'' as follows (see List 
of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any item in 1C010.c or 
d.
* * * * *

    16. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 1, ECCN 1C012 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    1C012 Materials, as follows (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any item in this entry.
* * * * *

    17. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 1, ECCN 1D002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    1D002 ``Software'' for the ``development'' of organic 
``matrix'', metal ``matrix'' or carbon ``matrix'' laminates or 
``composites''.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``software'' for the 
``development'' of organic ``matrix'', metal ``matrix'' or carbon 
``matrix'' laminates or ``composites'' specified ECCN 1A002.
* * * * *

    18. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 1, ECCN 1E001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    1E001 ``Technology'' according to the General Technology Note 
for the ``development'' or ``production'' of items controlled by 
1A001.b, 1A001.c, 1A002, 1A003, 1A004, 1A005, 1A006.b, 1A007, 1A008, 
1A101, 1B (except 1B999), or 1C (except 1C355, 1C980 to 1C984, 
1C988, 1C990, 1C991, 1C995 to 1C999).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``technology'' 
according to the General Technology Note for the ``development'' or 
``production'' of equipment and materials specified by ECCNs 1A002, 
1C001, 1C007.c or d, 1C010.c or d or 1C012.
* * * * *

    19. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 1, ECCN 1E002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    1E002 Other ``technology'' as follows (see List of Items 
Controlled).
* * * * *

License Exceptions

* * * * *

[[Page 76660]]

    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any item in 1E002.e or 
.f.
* * * * *

    20. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 2, ECCN 2D001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    2D001 ``Software'', other than that controlled by 2D002, 
specially designed or modified for the ``development'', 
``production'' or ``use'' of equipment controlled by 2A001 or 2B001 
to 2B009.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``software'', other 
than that specified by ECCN 2D002, specially designed for the 
``development'' or ``production'' of equipment as follows:
    ECCN 2B001 entire entry; or
    ``Numerically controlled'' or manual machine tools as specified 
in 2B003.
* * * * *

    21. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 2, ECCN 2E001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    2E001 ``Technology'' according to the General Technology Note 
for the ``development'' of equipment or ``software'' controlled by 
2A (except 2A983, 2A984, 2A991, or 2A994), 2B (except 2B991, 2B993, 
2B996, 2B997, or 2B998), or 2D (except 2D983, 2D984, 2D991, 2D992, 
or 2D994).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``technology'' 
according to the General Technology Note for the ``development'' of 
``software'' specified in the License Exception STA paragraph in the 
License Exception section of ECCN 2D001 or for the ``development'' 
of equipment as follows:
    ECCN 2B001 entire entry; or
    ``Numerically controlled'' or manual machine tools as specified 
in 2B003.
* * * * *

    22. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 2, ECCN 2E002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    2E002 ``Technology'' according to the General Technology Note 
for the ``production'' of equipment controlled by 2A (except 2A983, 
2A984, 2A991, or 2A994), or 2B (except 2B991, 2B993, 2B996, 2B997, 
or 2B998).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``technology'' 
according to the General Technology Note for the ``production'' of 
equipment as follows:
    ECCN 2B001 entire entry; or
    ``Numerically controlled'' or manual machine tools as specified 
in 2B003.
* * * * *

    23. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 3, ECCN 3A002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    3A002 General purpose electronic equipment and accessories 
therefor, as follows (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any item in 3A002.g.1.
* * * * *

    24. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 3, ECCN 3B001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    3B001 Equipment for the manufacturing of semiconductor devices 
or materials, as follows (see List of Items Controlled) and 
specially designed components and accessories therefor.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any item in 3B001.a.2.
* * * * *

    25. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 3, ECCN 3D001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    3D001 ``Software'' specially designed for the ``development'' or 
``production'' of equipment controlled by 3A001.b to 3A002.g or 3B 
(except 3B991 and 3B992).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``software'' specially 
designed for the ``development'' or ``production'' of equipment 
specified by 3A002.g.1 or 3B001.a.2.
* * * * *

    26. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 3, ECCN 3E001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    3E001 ``Technology'' according to the General Technology Note 
for the ``development'' or ``production'' of equipment or materials 
controlled by 3A (except 3A292, 3A980, 3A981, 3A991 3A992, or 
3A999), 3B (except 3B991 or 3B992) or 3C (except 3C992).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``technology'' 
according to the General Technology Note for the ``development'' or 
``production'' of equipment specified by ECCNs 3A002.g.1. or 
3B001.a.2.
* * * * *

    27. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 4, ECCN 4A001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    4A001 Electronic computers and related equipment, having any of 
the following (see List of Items Controlled), and ``electronic 
assemblies'' and specially designed components therefor.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any commodity in 
4A001.a.2.
* * * * *

    28. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 4, ECCN 4D001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    4D001 ``Software'' as follows (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``software'' specially 
designed for the ``development'' or ``production'' of equipment 
specified by ECCN 4A001.a.2 or for the ``development'' or 
``production'' of ``digital computers'' having an `Adjusted Peak 
Performance' (`APP') exceeding 0.5 Weighted TeraFLOPS (WT).
* * * * *

    29. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 4,

[[Page 76661]]

ECCN 4E001 is amended by adding at the end of the License Exception 
section, a new License Exception STA paragraph to read as follows:

    4E001 ``Technology'' as follows (see List of Items Controlled).

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``technology'' 
according to the General Technology Note for the ``development'' or 
``production'' of any of the following equipment or ``software'':
    a. Equipment specified by ECCN 4A001.a.2;
    b. ``Digital computers'' having an `Adjusted Peak Performance' 
(`APP') exceeding 0.5 Weighted TeraFLOPS (WT); or
    c. ``Software'' specified in the License Exception STA paragraph 
found in the License Exception section of ECCN 4D001.

    30. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 5, Part 1, ECCN 5A001 is amended by adding at the end of the 
License Exception section, a new License Exception STA paragraph to 
read as follows:

    5A001 Telecommunications systems, equipment, components and 
accessories, as follows (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any commodity in 
5A001.b.3 or b.5
* * * * *

    31. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 5, Part 1, ECCN 5B001 is amended by adding at the end of the 
License Exception section, a new License Exception STA paragraph to 
read as follows:

    5B001 Telecommunication test, inspection and production 
equipment, components and accessories, as follows (See List of Items 
Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for 5B001.a equipment and 
specially designed components or accessories therefor, specially 
designed for the ``development'', ``production'' or ``use'' of 
equipment, functions or features specified by in ECCN 5A001.b.3 or 
b.5.
* * * * *

    32. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 5, Part 1, ECCN 5D001 is amended by adding at the end of the 
License Exception section, a new License Exception STA paragraph to 
read as follows:

    5D001 ``Software'' as follows (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for 5D001.a for 
``software'' specially designed for the ``development'' or 
``production'' of equipment, functions or features, specified by 
ECCN 5A001.b.3 or .b.5; and for 5D001.b. for ``software'' specially 
designed or modified to support ``technology'' specified by the STA 
paragraph in the License Exception section of ECCN 5E001.
* * * * *

    33. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 5, Part 1, ECCN 5E001 is amended by adding at the end of the 
License Exception section, a new License Exception STA paragraph to 
read as follows:

    5E001 ``Technology'' as follows (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``technology'' 
according to the General Technology Note for the ``development'' or 
``production'' of equipment, functions or features specified by 
5A001.b.3 or .b.5 or for ``software'' in 5D001.a that is specified 
in the STA paragraph in the License Exception section of ECCN 5D001.
* * * * *

    34. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 6, ECCN 6A001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    6A001 Acoustic systems, equipment and components, as follows 
(see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for commodities in 
6A001.a.1.b, 6A001.a.1.e or 6A001.a.2.
* * * * *

    35. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 6, ECCN 6A002 is amended by revising the ECCN heading and by 
adding at the end of the License Exception section, a new License 
Exception STA paragraph to read as follows:

    6A002 Optical sensors or equipment and components therefore, as 
follows (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for:
    6A002.a.1.a., b. or c; or
    6A002.a.2.a. in which the photocathode in described in 
6A002.a.2.a 3.a is a Multialkali photocathode (e.g., S-20 and S-25) 
having a luminous sensitivity exceeding 700 [mu]A/lm; or
    6A002.a.2.b; or
    6A002.a.3; or
    6A002.b; or
    6A002.c ``Direct view'' imaging equipment incorporating any of 
the following:
    1. Image intensifier tubes having the characteristics listed in 
the description of 6A002.a.2.a earlier in this STA paragraph of 
License Exception section to this ECCN or 6A002.a.2.b; or
    2. ``Focal plane arrays'' having the characteristics listed in 
the description of 6A002.a.3; or
    6A002.e.
* * * * *

    36. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 6, ECCN 6A003 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    6A003 Cameras.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for: 6A003.b.3 and b.4.
* * * * *

    37. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 6, ECCN 6A004 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    6A004 Optical equipment and components, as follows (see List of 
Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any commodity in 
6A004.c and d.
* * * * *

    38. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 6, ECCN 6A006 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

[[Page 76662]]

    6A006 ``Magnetometers'', ``magnetic gradiometers'', ``intrinsic 
magnetic gradiometers'', underwater electric field sensors, 
``compensation systems'', and specially designed components 
therefor, as follows (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any commodity in:
    6A006.a.1; or
    6A006.a.2; or
    6A006.c.1 ``Magnetic gradiometers'' using multiple 
``magnetometers'' specified by 6A006.a.1 or 6.A006.a.2; or
    6A006.d.
* * * * *

    39. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 6, ECCN 6A008 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    6A008 Radar systems, equipment and assemblies, having any of the 
following (see List of Items Controlled), and specially designed 
components therefor.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any commodity in 
6A008.d, 6A008.h, 6A008.k or 6A008.l.3.
* * * * *

    40. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 6, ECCN 6B008 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    6B008 Pulse radar cross-section measurement systems having 
transmit pulse widths of 100 ns or less, and specially designed 
components therefor.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any commodity in this 
entry.
* * * * *

    41. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 6, ECCN 6D001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    6D001 ``Software'' specially designed for the ``development'' or 
``production'' of equipment controlled by 6A004, 6A005, 6A008 or 
6B008.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``software'' specially 
designed for the ``development'' or ``production'' of equipment 
specified by ECCNs 6A004.c, 6A004.d, 6A008.d, 6A008.h, 6A008.k, 
6A008.1.3, or 6B008.
* * * * *

    42. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 6, ECCN 6D003 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    6D003 Other ``software'' as follows (see List of Items 
Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for software in 6D003.a.
* * * * *

    43. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 6, ECCN 6E001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    6E001 ``Technology'' according to the General Technology Note 
for the ``development'' of equipment, materials or ``software'' 
controlled by 6A (except 6A991, 6A992, 6A994, 6A995, 6A996, 6A997, 
or 6A998), 6B (except 6B995), 6C (except 6C992 or 6C994), or 6D 
(except 6D991, 6D992, or 6D993).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any technology in this 
entry.
* * * * *

    44. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 6, ECCN 6E002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    6E002 ``Technology'' according to the General Technology Note 
for the ``production'' of equipment or materials controlled by 6A 
(except 6A991, 6A992, 6A994, 6A995, 6A996, 6A997 or 6A998), 6B 
(except 6B995) or 6C (except 6C992 or 6C994).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``technology'' 
according to the General Technology Note for the ``production'' of 
equipment specified in the STA exclusion paragraphs found in the 
License Exception sections of by ECCNs 6A001, 6A002, 6A003, 6A004, 
6A006, 6A008, or 6B008.
* * * * *

    45. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 7, ECCN 7D002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    7D002 ``Source code'' for the ``use'' of any inertial navigation 
equipment, including inertial equipment not controlled by 7A003 or 
7A004, or Attitude and Heading Reference Systems (`AHRS').
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any software in this 
entry.
* * * * *

    46. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 7, ECCN 7D003 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    7D003 Other ``software'' as follows (see List of Items 
Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for software in 7D003.a, b, 
c, d.1 to d.4 or d.7.
* * * * *

    47. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 7, ECCN 7E001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    7E001 ``Technology'' according to the General Technology Note 
for the ``development'' of equipment or ``software'', controlled by 
7A (except 7A994), 7B (except 7B994) or 7D (except 7D994).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any technology in this 
entry.
* * * * *

    48. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 7, ECCN 7E002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    7E002 ``Technology'' according to the General Technology Note 
for the

[[Page 76663]]

``production'' of equipment controlled by 7A (except 7A994) or 7B 
(except 7B994).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any technology in this 
entry.
* * * * *

    49. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 8, ECCN 8A001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    8A001 Submersible vehicles and surface vessels, as follows (see 
List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any commodity in 
8A001.b, 8A001.c or 8A001.d.
* * * * *

    50. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 8, ECCN 8A002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    8A002 Marine systems, equipment and components, as follows (see 
List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any commodity in 
8A002.b, h, j, o.3, or p.
* * * * *

    51. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 8, ECCN 8D001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    8D001 ``Software'' specially designed or modified for the 
``development'', ``production'' or ``use'' of equipment or 
materials, controlled by 8A (except 8A018 or 8A992), 8B or 8C.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``software'' specially 
designed for the ``development'' or ``production'' of equipment in 
8A001.b, 8A001.c, 8A001.d, 8A002.b, 8A002.h, 8A002.j, 8A002.o.3 or 
8A002.p.
* * * * *

    52. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 8, ECCN 8D002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    8D002 Specific ``software'' specially designed or modified for 
the ``development'', ``production'', repair, overhaul or 
refurbishing (re-machining) of propellers specially designed for 
underwater noise reduction.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any software in this 
entire entry.
* * * * *

    53. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 8, ECCN 8E001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    8E001 ``Technology'' according to the General Technology Note 
for the ``development'' or ``production'' of equipment or materials, 
controlled by 8A (except 8A018 or 8A992), 8B or 8C.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``technology'' 
according to the General Technology Note for the ``development'' or 
``production'' of equipment specified by 8A001.b, 8A001.c, 8A001.d, 
8A002.b, 8A002.h, 8A002.j, 8A002.o.3 or 8A002.p.
* * * * *

    54. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 8, ECCN 8E002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    8E002 Other ``technology'' as follows (see List of Items 
Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for technology in 8E002.a.
* * * * *

    55. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 9, ECCN 9B001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    9B001 Equipment, tooling and fixtures, specially designed for 
manufacturing gas turbine blades, vanes or tip shroud castings, as 
follows (see List of Items Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for commodities in 9B001.b
* * * * *

    56. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 9, ECCN 9D001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    9D001 ``Software'' specially designed or modified for the 
``development'' of equipment or ``technology'', controlled by 9A 
(except 9A018, 9A990 or 9A991), 9B (except 9B990 or 9B991) or 9E003.
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``software'' specially 
designed or modified for the ``development'' of equipment or 
``technology'', specified by ECCNs 9B001.b. or 9E003.a.1, 9E003.a.2 
to a.5, 9E003.a.8, or 9E003.h.
* * * * *

    57. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 9, ECCN 9D002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    9D002 ``Software'' specially designed or modified for the 
``production'' of equipment controlled by 9A (except 9A018, 9A990, 
or 9A991) or 9B (except 9B990 or 9B991).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for ``software'' specially 
designed or modified for the ``production'' of equipment specified 
by 9B001.b.
* * * * *

    58. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 9, ECCN 9D004 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    9D004 Other ``software'' as follows (see List of Items 
Controlled).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for software in 9D004.a and 
9D004.c.
* * * * *

[[Page 76664]]

    59. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 9, ECCN 9E001 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    9E001 ``Technology'' according to the General Technology Note 
for the ``development'' of equipment or ``software'', controlled by 
9A001.b, 9A004 to 9A012, 9B (except 9B990 or 9B991), or 9D (except 
9D990 or 9D991).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any technology in this 
entry.
* * * * *

    60. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 9, ECCN 9E002 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    9E002 ``Technology'' according to the General Technology Note 
for the ``production'' of equipment controlled by 9A001.b, 9A004 to 
9A011 or 9B (except 9B990 or 9B991).
* * * * *

License Exceptions

* * * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any technology in this 
entry.
* * * * *

    61. In Supplement No. 1 to Part 774 (the Commerce Control List), 
Category 9, ECCN 9E003 is amended by adding at the end of the License 
Exception section, a new License Exception STA paragraph to read as 
follows:

    9E003 Other ``technology'' as follows (see List of Items 
Controlled).
* * * * *

License Exceptions

     * * *
    STA: Paragraph (c)(2) of License Exception STA (Sec.  
740.20(c)(2)) of the EAR may not be used for any technology in 
9E003.a.1, 9E003.a.2 to a.5, 9E003.a.8, or 9E003.h.
* * * * *

    Dated: December 6, 2010.
Gary Locke,
Secretary of Commerce.
[FR Doc. 2010-30968 Filed 12-8-10; 8:45 am]
BILLING CODE 3510-33-P
```