Document ID: BIS-2012-0029-0001
Agency: bis
Document Type: Rule
Title: Validated End-User Authorizations: Hynix Semiconductor China Ltd., Hynix Semiconductor Ltd., et al., in the People's Republic of China
Posted Date: 2012-07-09T04:00Z

[Federal Register Volume 77, Number 131 (Monday, July 9, 2012)]
[Rules and Regulations]
[Pages 40258-40261]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-16724]

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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR Part 748

[Docket No. 120608159-2159-01]
RIN 0694-AF71

Amendment to Existing Validated End-User Authorizations: Hynix 
Semiconductor China Ltd., Hynix Semiconductor (Wuxi) Ltd., and Boeing 
Tianjin Composites Co. Ltd. in the People's Republic of China

AGENCY: Bureau of Industry and Security, Commerce.

ACTION: Final rule.

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SUMMARY: In this rule, the Bureau of Industry and Security (BIS) amends 
the Export Administration Regulations (EAR) to revise the existing 
Authorization Validated End-User (VEU) listings for three VEUs in the 
People's Republic of China (PRC). Specifically, BIS amends the EAR to 
change the names of existing VEUs Hynix Semiconductor China Ltd. and 
Hynix Semiconductor (Wuxi) Ltd. and their respective ``Eligible 
Destinations'' in the PRC. Also, BIS amends the list of ``Eligible 
Items (by ECCN)'' that may be exported, reexported and transferred (in-
country) to the approved facility of VEU Boeing Tianjin Composites Co. 
Ltd. (BTC) in the PRC. These changes are prompted by factors arising 
from the companies' normal course of business, and are not the result 
of any activities of concern by the companies.

DATES: This rule is effective July 9, 2012.

FOR FURTHER INFORMATION CONTACT: Karen Nies-Vogel, Chair, End-User 
Review Committee, Bureau of Industry and Security, U.S. Department of 
Commerce, 14th Street & Pennsylvania Avenue NW., Washington, DC 20230; 
by telephone: (202) 482-5991, fax: (202) 482-3991, or email: 
ERC@bis.doc.gov.

SUPPLEMENTARY INFORMATION:

Background

Authorization Validated End-User

    BIS amended the EAR in a final rule on June 19, 2007 (72 FR 33646), 
creating a new authorization for ``Validated end-users'' (VEUs) located 
in eligible destinations to which eligible items may be exported, 
reexported, or transferred (in-country) under a general authorization 
instead of a license, in conformance with section 748.15 of the EAR. 
VEUs may obtain eligible items that are on the Commerce Control List, 
set forth in Supplement No. 1 to Part 774 of the EAR, without having to 
wait for their suppliers to obtain export licenses from BIS. Eligible 
items may include commodities, software, and technology, except those 
controlled for missile technology or crime control reasons.
    The VEUs listed in Supplement No. 7 to Part 748 of the EAR were 
reviewed and approved by the U.S. Government in accordance with the 
provisions of section 748.15 and Supplement Nos. 8 and 9 to Part 748 of 
the EAR. The revisions to Supplement No. 7 to Part 748 set forth in 
this rule are being made either at the request of the VEUs or pursuant 
to the U.S. Government's periodic review of VEU authorizations, and 
were approved by the End-User Review Committee (ERC) following the 
process set forth in Section 748.15 and Supplement No. 9 to Part 748 of 
the EAR.

Amendment to Existing Validated End-User Authorizations in the PRC

Revision to Names of Hynix Semiconductor China Ltd. and Hynix 
Semiconductor (Wuxi) Ltd. and Their ``Eligible destinations''

    In this rule, BIS amends Supplement No. 7 to Part 748 of the EAR to 
change the names of existing VEUs Hynix Semiconductor China Ltd. and 
Hynix Semiconductor (Wuxi) Ltd. and the names of the companies' 
respective ``Eligible destinations'' (i.e., facilities) in the People's 
Republic of China (PRC). Both companies were designated as VEUs on 
October 12, 2010 (75 FR 62462).
    In this rule, the name Hynix Semiconductor China Ltd. is changed to 
SK hynix Semiconductor (China) Ltd., and the name of the company's 
existing approved ``Eligible destination'' is changed from Hynix 
Semiconductor China Ltd. to SK hynix Semiconductor (China) Ltd. In 
addition, the name Hynix Semiconductor (Wuxi) Ltd. is changed to SK 
hynix Semiconductor (Wuxi) Ltd., and the name of the company's existing 
approved ``Eligible destination'' is changed from Hynix Semiconductor 
(Wuxi) Ltd. to SK hynix Semiconductor (Wuxi) Ltd. The addresses of the 
companies' respective ``Eligible destinations'' remain the same. These 
amendments are prompted by factors arising from the companies' normal 
course of business, and are not the result of activities of concern by 
the companies.

Revision to the List of ``Eligible items (by ECCN)'' for Boeing Tianjin 
Composites Co. Ltd.

    BIS designated BHA Aero Composite Parts Co. as a VEU on October 19, 
2007 (72 FR 59164). On April 29, 2009, BIS amended the authorization by 
changing the name of the VEU to Boeing Tianjin Composites Co., Ltd. 
(BTC) (74 FR 19382). In addition, on February 24, 2012, BIS amended 
BTC's VEU authorization to correct the address of BTC's eligible 
destination and revise the list of ``Eligible items (by ECCN)'' that 
may be exported, reexported, and transferred (in-country) to BTC (77 FR 
10953). In this rule, BIS further revises the list of ``Eligible items 
(by ECCN)'' that may be exported, reexported, and transferred (in-
country) to BTC. This amendment is prompted by factors arising from 
BTC's normal course of business, and is not the result of activities of 
concern by BTC.
    BTC's list of ``Eligible items (by ECCN)'' prior to the publication 
of this rule was:

    1A002.a, 1B001.f, 1C010.b, 1C010.e, 1D001 (limited to 
``software'' specially designed or modified for the ``development'', 
``production'' or ``use'' of equipment controlled by 1B001.f), 1E001 
(limited to ``technology'' according to the General Technology Note 
for the ``development'' or ``production'' of items controlled by 
1A002.a, 1B001.f, and 1C010.b & .e), 2B001.b.2 (limited to machine 
tools with accuracies no better than (i.e., less than) 13 microns),

[[Page 40259]]

2B001.e, 2D001 (limited to ``software,'' other than that controlled 
by 2D002, specially designed or modified for the ``development'', 
``production'' or ``use'' of equipment controlled by 2B001.b.2 and 
2B001.e), and 2D002 (limited to ``software'' for electronic devices, 
even when residing in an electronic device or system, enabling such 
devices or systems to function as a ``numerical control'' unit, 
capable of coordinating simultaneously more than 4 axes for 
``contouring control'' controlled by 2B001.b.2 and 2B001.e).

With this rule, BTC's revised list of ``Eligible items (by ECCN)'' is:

    1B001.f, 1D001 (limited to ``software'' specially designed or 
modified for the ``use'' of equipment controlled by 1B001.f), 
2B001.b.2 (limited to machine tools with accuracies no better than 
(i.e., not less than) 13 microns), 2D001 (limited to ``software,'' 
other than that controlled by 2D002, specially designed or modified 
for the ``use'' of equipment controlled by 2B001.b.2), and 2D002 
(limited to ``software'' for electronic devices, even when residing 
in an electronic device or system, enabling such devices or systems 
to function as a ``numerical control'' unit, capable of coordinating 
simultaneously more than 4 axes for ``contouring control'' 
controlled by 2B001.b.2).

    Since August 21, 2001, the Export Administration Act (the Act) has 
been in lapse and the President, through Executive Order 13222 of 
August 17, 2001 (3 CFR, 2001 Comp., p. 783 (2002)), as extended most 
recently by the Notice of August 12, 2011, 76 FR 50661 (August 16, 
2011), has continued the EAR in effect under the International 
Emergency Economic Powers Act. BIS continues to carry out the 
provisions of the Act, as appropriate and to the extent permitted by 
law, pursuant to Executive Order 13222.

Rulemaking Requirements

    1. Executive Orders 13563 and 12866 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, reducing costs, harmonizing rules, and promoting flexibility. 
This rule has been determined to be not significant for purposes of 
Executive Order 12866.
    2. This rule involves collections previously approved by the Office 
of Management and Budget (OMB) under Control Number 0694-0088, ``Multi-
Purpose Application,'' which carries a burden hour estimate of 43.8 
minutes to prepare and submit form BIS-748; and for recordkeeping, 
reporting and review requirements in connection with Authorization VEU, 
which carries an estimated burden of 30 minutes per submission. This 
rule is expected to result in a decrease in license applications 
submitted to BIS. Total burden hours associated with the Paperwork 
Reduction Act of 1995 (44 U.S.C. 3501 et seq.) (PRA) and OMB Control 
Number 0694-0088 are not expected to increase significantly as a result 
of this rule.
    Notwithstanding any other provisions of law, no person is required 
to respond nor be subject to a penalty for failure to comply with a 
collection of information, subject to the requirements of the PRA, 
unless that collection of information displays a currently valid OMB 
Control Number.
    3. This rule does not contain policies with Federalism implications 
as that term is defined under Executive Order 13132.
    4. Pursuant to the Administrative Procedure Act (APA), 5 U.S.C. 
553(b)(B), BIS finds good cause to waive requirements that this rule be 
subject to notice and the opportunity for public comment because such 
notice and comment here are unnecessary and contrary to the public 
interest. In determining whether to grant VEU designations, a committee 
of U.S. Government agencies evaluates information about and commitments 
made by candidate companies, the nature and terms of which are set 
forth in 15 CFR part 748, Supplement No. 8. The criteria for evaluation 
by the committee are set forth in 15 CFR 748.15(a)(2).
    The information, commitments, and criteria for this extensive 
review were all established through the notice of proposed rulemaking 
and public comment process (71 FR 38313, July 2, 2006 (proposed rule), 
and 72 FR 33646, June 19, 2007 (final rule)). Given the similarities 
between the authorizations provided under the VEU program and export 
licenses (as discussed further below), the publication of this 
information does not establish new policy; in publishing this final 
rule, BIS simply amends three VEU authorizations by updating the names 
of two end users and revising the ``Eligible items (by ECCN)'' of 
another end user. These changes have been made within the established 
regulatory framework of the Authorization VEU program. Further, this 
rule does not abridge the rights of the public or eliminate the 
public's option to export under any of the forms of authorization set 
forth in the EAR.
    Publication of this rule in other than final form is unnecessary 
because the authorization granted in the rule is consistent with the 
authorizations granted to exporters for individual licenses (and 
amendments or revisions thereof), which do not undergo public review. 
Just as license applicants do, VEU authorization applicants provide the 
U.S. Government with confidential business information. This 
information is extensively reviewed according to the criteria for VEU 
authorizations, as set out in 15 CFR 748.15(a)(2). Additionally, just 
as the interagency reviews license applications, the authorizations 
granted under the VEU program involve interagency deliberation and 
result from review of public and non-public sources, including 
licensing data, and the measurement of such information against the VEU 
authorization criteria. Given the thorough nature of the review, and in 
light of the parallels between the VEU application review process and 
the review of license applications, public comment on this 
authorization and subsequent amendments prior to publication is 
unnecessary. Moreover, because, as noted above, the criteria and 
process for authorizing and administering VEUs were developed with 
public comments; allowing additional public comment on this amendment 
to individual VEU authorizations, which was determined according to 
those criteria, is unnecessary. Finally, allowing for prior public 
notice and comment is contrary to the public interest because it could 
cause confusion with the VEU status of the three companies identified 
in this rule due to the change of VEU names for two of those companies, 
and the items that may be exported, reexported or transferred (in-
country) without a license to one of those companies.
    Section 553(d) of the APA generally provides that rules may not 
take effect earlier than thirty (30) days after they are published in 
the Federal Register. BIS finds good cause to waive the requirement of 
5 U.S.C. 553(d)(3) to delay the effectiveness of this regulation, 
because such a delay is unnecessary. BIS simply amends three VEU 
authorizations by updating the names of two end users and revising the 
``Eligible items (by ECCN)'' of another end user. These changes have 
been made within the established regulatory framework of the 
Authorization VEU program. Further, this rule does not abridge the 
rights of the public or eliminate the public's option to export under 
any of the forms of authorization set forth in the EAR. Delaying this 
action's effectiveness could cause confusion with the VEU status of the

[[Page 40260]]

three companies identified in this rule due to the change of VEU names 
for two of those companies, and the items that may be exported, 
reexported or transferred (in-country) without a license to one of 
those companies. Accordingly, it would be unnecessary and contrary to 
the public interest to delay this rule's effectiveness.
    No other law requires that a notice of proposed rulemaking and an 
opportunity for public comment be given for this final rule. Because a 
notice of proposed rulemaking and an opportunity for public comment are 
not required under the APA or by any other law, the analytical 
requirements of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) 
are not applicable and no regulatory flexibility analysis has been 
prepared.

List of Subjects in 15 CFR Part 748

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

    Accordingly, Part 748 of the EAR (15 CFR parts 730-774) is amended 
as follows:

PART 748--[AMENDED]

0
1. The authority citation for 15 CFR Part 748 continues to read as 
follows:

    Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 
E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 
FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 12, 2011, 76 
FR 50661 (August 16, 2011).

0
2. Supplement No. 7 to Part 748 is amended in ``China (People's 
Republic of)'' by:
0
a. Revising the entry for ``Boeing Tianjin Composites Co. Ltd.'';
0
b. Removing the entries for ``Hynix Semiconductor China Ltd.'', and 
``Hynix Semiconductor (Wuxi) Ltd.''; and
0
c. Adding new entries for ``SK hynix Semiconductor (China) Ltd.'', and 
``SK hynix Semiconductor (Wuxi) Ltd.'' in alphabetical order.
    The revisions and additions read as follows:

  Supplement No. 7 to Part 748--Authorization Validated End-User (VEU); List of Validated End-Users, Respective Items Eligible for Export, Reexport and
                                                           Transfer, and Eligible Destinations
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                Eligible
         Country            Validated end user  Eligible items (by ECCN)      destination                      Federal Register citation
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
China (People's Republic
 of)
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
                           Boeing Tianjin       1B001.f, 1D001 (limited   Boeing Tianjin       72 FR 59164, 10/19/07.
                            Composites Co. Ltd.  to ``software''           Composites Co.      74 FR 19381, 4/29/09.
                                                 specially designed or     Ltd., No. 4-388     77 FR 10953, 2/24/12.
                                                 modified for the          Hebei Road, Tanggu  77 FR [INSERT FR PAGE NUMBER], 7/9/12.
                                                 ``use'' of equipment      Tianjin, China.
                                                 controlled by 1B001.f),
                                                 2B001.b.2 (limited to
                                                 machine tools with
                                                 accuracies no better
                                                 than (i.e., not less
                                                 than) 13 microns),
                                                 2D001 (limited to
                                                 ``software,'' other
                                                 than that controlled by
                                                 2D002, specially
                                                 designed or modified
                                                 for the ``use'' of
                                                 equipment controlled by
                                                 2B001.b.2), and 2D002
                                                 (limited to
                                                 ``software'' for
                                                 electronic devices,
                                                 even when residing in
                                                 an electronic device or
                                                 system, enabling such
                                                 devices or systems to
                                                 function as a
                                                 ``numerical control''
                                                 unit, capable of
                                                 coordinating
                                                 simultaneously more
                                                 than 4 axes for
                                                 ``contouring control''
                                                 controlled by
                                                 2B001.b.2).
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
                           SK hynix             3B001.a, 3B001.b,         SK hynix             75 FR 62462, 10/12/10.
                            Semiconductor        3B001.c, 3B001.d,         Semiconductor       77 FR [INSERT FR PAGE NUMBER], 7/9/12.
                            (China) Ltd.         3B001.e, and 3B001.f.     (China) Ltd., Lot
                                                                           K7/K7-1, Export
                                                                           Processing Zone,
                                                                           Wuxi, Jiangsu,
                                                                           China.

[[Page 40261]]

 
                           SK hynix             3B001.a, 3B001.b,         SK hynix             75 FR 62462, 10/12/10.
                            Semiconductor        3B001.c, 3B001.d,         Semiconductor       77 FR [INSERT FR PAGE NUMBER], 7/9/12.
                            (Wuxi) Ltd.          3B001.e, and 3B001.f.     (Wuxi) Ltd., Lot
                                                                           K7/K7-1, Export
                                                                           Processing Zone,
                                                                           Wuxi, Jiangsu,
                                                                           China.
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Dated: June 29, 2012.
Kevin J. Wolf,
Assistant Secretary for Export Administration.
[FR Doc. 2012-16724 Filed 7-6-12; 8:45 am]
BILLING CODE 3510-33-P