[Federal Register Volume 60, Number 71 (Thursday, April 13, 1995)]
[Rules and Regulations]
[Pages 18731-18733]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-9157]



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DEPARTMENT OF COMMERCE

Bureau of Export Administration

15 CFR Parts 771 and 779

[Docket No. 950407090-5090-01]
RIN 0694-AB18


Establishment of New General License G-BETA for Exports of 
Certain Beta Test Software

AGENCY: Bureau of Export Administration, Commerce.

ACTION: Interim rule.

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SUMMARY: This rule amends the Export Administration Regulations (EAR) 
by establishing a new General License G-BETA for certain exports of 
beta test software under the jurisdiction of the Department of 
Commerce. Under the provisions of this new General License, beta test 
software programs may be exported to all destinations except Country 
Groups S and Z, Iran, Iraq, Sudan, and Syria. Exporters are advised 
that certain restrictions apply, and should consult the EAR before 
using General License G-BETA.
    This new General License eligibility will greatly reduce the number 
of validated license applications for certain software intended for 
mass-market distribution.

DATES: This rule is effective April 13, 1995. Comments must be received 
by May 30, 1995.

ADDRESSES: Written comments (six copies) should be sent to Nancy Crowe, 
Bureau of Export Administration, Department of Commerce, P.O. Box 273, 
Washington, DC 20044.

FOR FURTHER INFORMATION CONTACT: Nancy Crowe, Regulatory Policy 
Division, Office of Exporter Services, Bureau of Export Administration, 
Telephone: (202) 482-2440.

SUPPLEMENTARY INFORMATION: This rule amends Part 771 of the Export 
Administration Regulations (EAR) by establishing a new General License 
G-BETA for certain exports of beta test software. This change will 
allow exports, under certain conditions, of software controlled by the 
Department of Commerce on the Commerce Control List (Supplement No. 1 
to Part 799.1 of the EAR), and under Commerce licensing jurisdiction, 
which would otherwise require a validated license to all destinations 
except Country Groups S and Z, Iran, Iraq, Sudan, and Syria.
    This rule will allow shipment under General License G-BETA of beta 
test software programs that: (a) Are intended for export and reexport 
under the provisions of the General Software Note (Supplement No. 2 to 
Part 799.1 of the EAR) after completion of testing; (b) are provided 
free-of-charge or at a price that does not exceed the cost of 
reproduction and distribution; and (c) are designed for user-
installation. In addition, the exporter must obtain a statement from 
each testing consignee prior to shipment certifying that the beta test 
software will only be used for beta testing purposes, and will not be 
rented, leased, sold, sublicensed, assigned, or otherwise transferred. 
Further, the statement must certify that the testing consignee will not 
transfer or export any product, process, or service that is the direct 
product of the beta test software. Software shipped under General 
License G-BETA must be destroyed abroad or returned to the exporter 
within 30 days of the end of the beta test period as defined by the 
software producer or, if the software producer does not define a test 
period, within 30 days of completion of the consignee's role in the 
test.
    The following is a brief description of the development of this 
rule. In the Fall 

[[Page 18732]]
of 1994, BXA hosted a large seminar for exporters. At that meeting, BXA 
invited the exporting community to provide input on administrative 
changes that might be made to the EAR without the passage of new 
legislation. In response to that invitation, several of the major 
exporters of mass market software provided suggestions on a new general 
license to authorize the export of software for beta testing. BXA also 
gathered the views of industry on a new general license for beta test 
software through BXA's Telecommunications Technical Advisory Committee, 
Regulations & Procedures Technical Advisory Committee, and Computer 
Systems Technical Advisory Committee. The industry views served as a 
basis for BXA's development of a regulation on General License G-BETA.
    BXA shared with industry its view of the possible changes in the 
draft regulation and sought information from certain software exporters 
to determine the industry's best practices for exporting software to 
Beta testers. For example, BXA collected samples of end-use clauses 
regularly used by software producers for commercial purposes. BXA then 
shaped General License G-BETA so that certifications required under the 
rule are consistent with the standard practices of many members of the 
industry. This has the benefit of achieving the objectives of the 
export control system with the least intrusive impact on the exporting 
community. The industry input provided by the advisory committees and 
by the companies was highly valuable to BXA in developing General 
License G-BETA.
    This new General License eligibility will reduce the number of 
validated license applications for certain software intended for 
distribution to the general public.

Rulemaking Requirements

    1. This interim rule has been determined to be not significant for 
purposes of E. O. 12866.
    2. This rule involves collections of information subject to the 
Paperwork Reduction Act of 1980 (44 U.S.C. 3501 et seq.). These 
collections have been approved by the Office of Management and Budget 
under control numbers 0694-0005, 0694-0007, and 0694-0010.
    3. This rule does not contain policies with Federalism implications 
sufficient to warrant preparation of a Federalism assessment under 
Executive Order 12612.
    4. Because a notice of proposed rulemaking and an opportunity for 
public comment are not required to be given for this rule by section 
553 of the Administrative Procedure Act (5 U.S.C. 553) or by any other 
law, under section 3(a) of the Regulatory Flexibility Act (5 U.S.C. 
603(a) and 604(a)) no initial or final Regulatory Flexibility Analysis 
has to be or will be prepared.
    5. The provisions of the Administrative Procedure Act (5 U.S.C. 
553) requiring notice of proposed rulemaking, the opportunity for 
public participation, and a delay in effective date, are inapplicable 
because this regulation involves a military and foreign affairs 
function of the United States. Further, no other law requires that a 
notice of proposed rulemaking and an opportunity for public comment be 
given for this rule.
    However, because of the importance of the issues raised by these 
regulations, this rule is issued in interim form and comments will be 
considered in the development of final regulations. Accordingly, the 
Department encourages interested persons who wish to comment to do so 
at the earliest possible time to permit the fullest consideration of 
their views.
    The period for submission of comments will close May 30, 1995. The 
Department will consider all comments received before the close of the 
comment period in developing final regulations. Comments received after 
the end of the comment period will be considered if possible, but their 
consideration cannot be assured. The Department will not accept public 
comments accompanied by a request that a part or all of the material be 
treated confidentially because of its business proprietary nature or 
for any other reason. The Department will return such comments and 
materials to the person submitting the comments and will not consider 
them in the development of final regulations. All public comments on 
these regulations will be a matter of public record and will be 
available for public inspection and copying. In the interest of 
accuracy and completeness, the Department requires comments in written 
form.
    Oral comments must be followed by written memoranda, which will 
also be a matter of public record and will be available for public 
review and copying. Communications from agencies of the United States 
Government or foreign governments will not be made available for public 
inspection.
    The public record concerning these regulations will be maintained 
in the Bureau of Export Administration Freedom of Information Records 
Inspection Facility, Room 4525, Department of Commerce, 14th Street and 
Pennsylvania Avenue, N.W., Washington, DC 20230. Records in this 
facility, including written public comments and memoranda summarizing 
the substance of oral communications, may be inspected and copied in 
accordance with regulations published in Part 4 of Title 15 of the Code 
of Federal Regulations. Information about the inspection and copying of 
records at the facility may be obtained from Margaret Cornejo, Bureau 
of Export Administration Freedom of Information Officer, at the above 
address or by calling (202) 482-5653.

List of Subjects
15 CFR Part 771

    Exports, Reporting and recordkeeping requirements.

15 CFR Part 779

    Computer technology, Exports, Reporting and recordkeeping 
requirements, Science and technology.

    Accordingly, Parts 771 and 779 of the Export Administration 
Regulations (15 CFR Parts 730-799) are amended as follows:

PART 771--[AMENDED]

    1. The authority citation for 15 CFR Part 771 continues to read as 
follows:

    Authority: 50 U.S.C. App. 5, as amended; Pub. L. 264, 59 Stat. 
619 (22 U.S.C. 287c), as amended; Pub. L. 90-351, 82 Stat. 197 (18 
U.S.C. 2510 et seq.), as amended; sec. 101, Pub. L. 93-153, 87 Stat. 
576 (30 U.S.C. 185), as amended; sec. 103, Pub. L. 94-163, 89 Stat. 
877 (42 U.S.C. 6212), as amended; secs. 201 and 201(11)(e), Pub. L. 
94-258, 90 Stat. 309 (10 U.S.C. 7420 and 7430(e)), as amended; Pub. 
L. 95-223, 91 Stat. 1626 (50 U.S.C. 1701 et seq.); Pub. L. 95-242, 
92 Stat. 120 (22 U.S.C. 3201 et seq. and 42 U.S.C. 2139a); sec. 208, 
Pub. L. 95-372, 92 Stat. 668 (43 U.S.C. 1354); Pub. L. 96-72, 93 
Stat. 503 (50 U.S.C. App. 2401 et seq.), as amended; sec. 125, Pub. 
L. 99-64, 99 Stat. 156 (46 U.S.C. 466c); Pub. L. 102-484, 106 Stat. 
2575 (22 U.S.C. 6004); E.O. 11912 of April 13, 1976 (41 FR 15825, 
April 15, 1976); E.O. 12002 of July 7, 1977 (42 FR 35623, July 7, 
1977), as amended; E.O. 12058 of May 11, 1978 (43 FR 20947, May 16, 
1978); E.O. 12214 of May 2, 1980 (45 FR 29783, May 6, 1980); E.O. 
12851 of June 11, 1993 (58 FR 33181, June 15, 1993); E.O. 12867 of 
September 30, 1993 (58 FR 51747, October 4, 1993); E.O 12918 of May 
26, 1994 (59 FR 28205, May 31, 1994); E.O. 12924 of August 19, 1994 
(59 FR 43437 of August 23, 1994); and E.O. 12938 of November 14, 
1994 (59 FR 59099 of November 16, 1994)

PART 779--[AMENDED]

    2. The authority citation for 15 CFR Part 779 continues to read as 
follows:

    Authority: Pub. L. 90-351, 82 Stat. 197 (18 U.S.C. 2510 et 
seq.), as amended; Pub. L. 95-223, 91 Stat. 1626 (50 U.S.C. 1701 et 
seq.); Pub. L. 95-242, 92 Stat. 120 (22 U.S.C. 3201 et seq. and 42 
U.S.C. 2139a); Pub. L. 96-72, 

[[Page 18733]]
93 Stat. 503 (50 U.S.C. App. 2401 et seq.), as amended; Pub. L. 102-
484, 106 Stat. 2575 (22 U.S.C. 6004); E.O. 12002 of July 7, 1977 (42 
FR 35623, July 7, 1977), as amended; E.O. 12058 of May 11, 1978 (43 
FR 20947, May 16, 1978); E.O. 12214 of May 2, 1980 (45 FR 29783, May 
6, 1980); E.O. 12730 of September 30, 1990 (55 FR 40373, October 2, 
1990), as continued by Notice of September 25, 1992 (57 FR 44649, 
September 28, 1992); E.O. 12924 of August 19, 1994 (59 FR 43437, 
August 23, 1994); and E.O. 12938 of November 14, 1994 (59 FR 59099 
of November 16, 1994).

PART 771--[AMENDED]
    3. Part 771 is amended by adding a new Sec. 771.27 to read as 
follows:


Sec. 771.27  General license G-BETA; Exports of beta test software.

    (a) Scope. A General License designated G-BETA is established 
subject to the provisions of this section authorizing exports and 
reexports to eligible countries of beta test software intended for 
distribution to the general public.
    (b) Eligible countries. The countries that are eligible to receive 
exports and reexports under this General License are all countries 
except those listed in Country Groups S and Z, Iran, Iraq, Sudan, and 
Syria.
    (c) Eligible software. All software that is controlled by the 
Commerce Control List (see Supplement No. 1 to Part 799.1 of this 
subchapter), and under Commerce licensing jurisdiction, is eligible for 
export and reexport under General License G-BETA, subject to the 
restrictions set forth in this section.
    (d) Conditions for use. Any beta test software program may be 
exported or reexported to eligible countries if all of the conditions 
under this section are met:
    (1) The software producer intends to market the software to the 
general public after completion of the beta testing, as described in 
the General Software Note found in Supplement No. 2 to Part 799.1 of 
this subchapter;
    (2) The software producer provides the software to the testing 
consignee free-of-charge or at a price that does not exceed the cost of 
reproduction and distribution; and
    (3) The software is designed for installation by the end-user 
without further substantial support from the supplier.
    (e) Importer statement. Prior to shipping any eligible software 
under General License G-BETA, the exporter or reexporter must obtain 
the following statement from the testing consignee, which may be 
included in a contract, non-disclosure agreement, or other document 
that identifies the importer, the software to be exported, the country 
of destination, and the testing consignee:

    We certify that this beta test software will only be used for 
beta testing purposes, and will not be rented, leased, sold, 
sublicensed, assigned, or otherwise transferred. Further, we certify 
that we will not transfer or export any product, process, or service 
that is the direct product of the beta test software.

    (f) Use limitations. Only testing consignees that provide the 
importer statement required by paragraph (e) of this section may 
execute any software received under General License G-BETA.
    (g) Return or disposal of software. All beta test software exported 
under General License G-BETA must be destroyed abroad or returned to 
the exporter within 30 days of the end of the beta test period as 
defined by the software producer or, if the software producer does not 
define a test period, within 30 days of completion of the consignee's 
role in the test. Among other methods, this requirement may be 
satisfied by a software module that will destroy the software and all 
its copies at or before the end of the beta test period.

PART 779--[AMENDED]

    4. Part 779.2 is amended in the last sentence by revising the 
phrase ``exports to Canada<SUP>7,8'' to read ``exports to 
Canada<SUP>7,8, and exports of beta test software eligible for General 
License G-BETA.''.

    Dated: April 10, 1995.
Sue E. Eckert,
Assistant Secretary for Export Administration.
[FR Doc. 95-9157 Filed 4-12-95; 8:45 am]
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