Document ID: BIS-2021-0007-0001
Agency: bis
Document Type: Rule
Title: Addition of Entity to the Entity List, and Addition of Entity to the Military End-User List and Removals from the MEU List
Posted Date: 2021-01-15T05:00Z

[Federal Register Volume 86, Number 10 (Friday, January 15, 2021)]
[Rules and Regulations]
[Pages 4862-4865]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-00995]

[[Page 4861]]

Vol. 86

Friday,

No. 10

January 15, 2021

Part XII

Department of Commerce

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 Bureau of Industry and Security

15 CFR Parts 730, 734, 736, and 744

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Addition of Entity to the Entity List, and Addition of Entity to the 
Military End-User (MEU) List and Removals From the MEU List; Final 
Rule; Expansion of Certain End-Use and -End-User Controls and Controls 
on Specific Activities of U.S. Persons; Interim Final Rule

  Federal Register / Vol. 86, No. 10 / Friday, January 15, 2021 / Rules 
and Regulations  

[[Page 4862]]

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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR Part 744

[Docket No. 210111-0006]
RIN 0694-AI40

Addition of Entity to the Entity List, and Addition of Entity to 
the Military End-User (MEU) List and Removals From the MEU List

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) by adding one entity to the 
Entity List. This one entity has been determined by the U.S. Government 
to be acting contrary to the national security or foreign policy 
interests of the United States. This entity will be listed on the 
Entity List under the destination of the People's Republic of China 
(China). In addition, this final rule amends the EAR by adding one 
entity to the Military End-User (MEU) List. Lastly, this final rule 
removes two entities from the MEU List to remove a duplicate listing.

DATES: This rule is effective January 14, 2021.

FOR FURTHER INFORMATION CONTACT: Chair, End-User Review Committee, 
Office of the Assistant Secretary, Export Administration, Bureau of 
Industry and Security, Department of Commerce, Phone: (202) 482-5991, 
Fax: (202) 482-3911, Email: ERC@bis.doc.gov.

SUPPLEMENTARY INFORMATION:

Background

    The Entity List (supplement no. 4 to part 744 of the Export 
Administration Regulations (EAR)) identifies entities for which there 
is reasonable cause to believe, based on specific and articulable 
facts, that the entities have been involved, are involved, or pose a 
significant risk of being or becoming involved in activities contrary 
to the national security or foreign policy interests of the United 
States. The EAR (15 CFR parts 730-774) impose additional license 
requirements on, and limit the availability of most license exceptions 
for, exports, reexports, and transfers (in-country) to listed entities. 
The license review policy for each listed entity is identified in the 
``License review policy'' column on the Entity List, and the impact on 
the availability of license exceptions is described in the relevant 
Federal Register notice adding entities to the Entity List. BIS places 
entities on the Entity List pursuant to part 744 (Control Policy: End-
User and End-Use Based) and part 746 (Embargoes and Other Special 
Controls) of the EAR.
    The `Military End-User' (MEU) List (supplement no. 7 to part 744 of 
the EAR) identifies entities that have been determined by the ERC to be 
`military end users' pursuant to Sec.  744.21 of the EAR. That section 
imposes additional license requirements on, and limits the availability 
of most license exceptions for, exports, reexports, and transfers (in-
country) to listed entities on the MEU List, as specified in supplement 
no. 7 to part 744 and Sec.  744.21. Entities are listed on the MEU List 
under the destinations of China, Russia, or Venezuela. The license 
review policy for each listed entity is identified in the introductory 
text of supplement no. 7 to part 744 and in Sec.  744.21(b) and (e). 
The MEU List includes introductory text, which specifies the scope of 
the license requirements, limitations on the use of EAR license 
exceptions, and the license review policy that applies to the entities. 
These requirements are also reflected in Sec.  744.21, but for ease of 
reference, these also included in the introductory text of the 
supplement.
    The End-User Review Committee (ERC), composed of representatives of 
the Departments of Commerce (Chair), State, Defense, Energy and, where 
appropriate, the Treasury, makes all decisions regarding additions to, 
removals from, or other modifications to the Entity List and the MEU 
List. The ERC makes all decisions to add an entry to the Entity List 
and MEU List by majority vote and all decisions to remove or modify an 
entry by unanimous vote.

ERC Entity List Decisions

Additions to the Entity List

    Under Sec.  744.11(b) (Criteria for revising the Entity List) of 
the EAR, entities for which there is reasonable cause to believe, based 
on specific and articulable facts, that the entities have been 
involved, are involved, or pose a significant risk of being or becoming 
involved in activities that are contrary to the national security or 
foreign policy interests of the United States, and those acting on 
behalf of such entities, may be added to the Entity List. Paragraphs 
(b)(1) through (5) of Sec.  744.11 provide an illustrative list of 
activities that could be considered contrary to the national security 
or foreign policy interests of the United States.
    This rule implements the decision of the ERC to add one entity to 
the Entity List. This one entity will be listed on the Entity List 
under the destination of China. The ERC made the decision to add this 
one entity described below under the standard set forth in Sec.  
744.11(b) of the EAR.
    The ERC determined that the one subject entity is engaging in or 
enabling activities contrary to U.S. national security and foreign 
policy interests, as follows:
    The ERC determined that China National Offshore Oil Corporation 
Ltd. has been involved in the PRC's efforts to assert its unlawful 
maritime claims in the South China Sea, as well as efforts to 
intimidate and coerce other South China Sea coastal states from 
accessing and developing offshore marine resources.
    Pursuant to Sec.  744.11(b), the ERC determined that the conduct of 
the above-described one entity raises sufficient concerns that prior 
review, via the imposition of a license requirement, of exports, 
reexports, or transfers (in-country) of all items subject to the EAR 
involving this one entity, except for the exclusions from the license 
requirement specified in the next paragraph, and the possible issuance 
of license denials or the possible imposition of license conditions on 
shipments to this entity, will enhance BIS's ability to prevent 
violations of the EAR or otherwise protect U.S. national security or 
foreign policy interests.
    For China National Offshore Oil Corporation Ltd., BIS imposes a 
license requirement that applies to all items subject to the EAR except 
for crude oil, condensates, aromatics, natural gas liquids, hydrocarbon 
gas liquids, natural gas plant liquids, refined petroleum products, 
liquefied natural gas, natural gas, synthetic natural gas, and 
compressed natural gas that are identified under one of thirty-seven 
Harmonized System (HS) codes included in the license requirement column 
for this entry, or for items required for the continued operation of 
joint ventures with persons from countries in Country Group A:1 in 
supplement no. 1 to part 740 of the EAR not operating in the South 
China Sea.
    For this one entity added to the Entity List by this rule, BIS 
imposes a license review policy of a presumption of denial. In 
addition, no license exceptions are available for exports, reexports, 
or transfers (in-country) to the person being added to the Entity List 
in this rule.
    For the reasons described above, this final rule adds the following 
one entity to the Entity List:

[[Page 4863]]

China

     China National Offshore Oil Corporation Ltd.

ERC MEU List Decisions

Additions to the MEU List

    Under Sec.  744.21(b) of the EAR, BIS may inform persons either 
individually by specific notice, through amendment to the EAR published 
in the Federal Register, or through a separate notice published in the 
Federal Register, that a license is required for specific exports, 
reexports, or transfers (in-country) of any item because there is an 
unacceptable risk of use in or diversion to a `military end use' or 
`military end user' in China, Russia, or Venezuela. Under Sec.  
744.21(b)(1) of the EAR, BIS may designate entities subject to this 
additional prohibition under paragraph (b) that have been determined by 
the ERC to be a `military end user' pursuant to Sec.  744.21. These 
entities will be added to supplement no. 7 to part 744 (`Military End-
User' (MEU) List) in Federal Register notices published by BIS.
    This rule implements the decision of the ERC to add one entity to 
the MEU List. This entity will be listed on the MEU List under the 
destination of China. The ERC made the decision to add this entity 
described below under the standard set forth in Sec.  744.21 of the 
EAR, including the criteria for what constitutes a `military end user' 
under paragraph (g) and `military end use' under paragraph (f).
    The license requirement for this entity that will be listed on the 
MEU List applies to the export, reexport, or transfer (in-country) of 
any item subject to the EAR listed in supplement no. 2 to part 744. For 
this one entity added to the MEU List by this rule, BIS imposes a 
license review policy of a presumption of denial as set forth in Sec.  
744.21(e).
    No license exceptions are available for exports, reexports, or 
transfers (in-country) to listed entities on the MEU List for items 
specified in supplement no. 2 to part 744, except license exceptions 
for items authorized under the provisions of License Exception GOV set 
forth in Sec.  740.11(b)(2)(i) and (ii) of the EAR.
    The acronym ``a.k.a.'' (also known as) is used in entries on the 
MEU List to identify aliases, thereby assisting exporters, reexporters, 
and transferors in identifying entities on the MEU List.
    For the reasons described above, this final rule adds the following 
one entity to the MEU List:

China

     Beijing Skyrizon Aviation Industry Investment Co., Ltd.

Removals From the MEU List

    The ERC reviews the MEU List regularly for identifying needed 
modifications, as specified in supplement no. 5 to part 744 (Procedures 
For End-User Review Committee Entity List Decisions). Consistent with 
the ERC's decision on the parties included in supplement no. 5, two 
entities are being removed from supplement no. 7 to part 744.
    This rule removes ``Korporatsiya Vsmpo Avisma OAO,'' an entity 
located in Russia, from the MEU List because it is a duplicate listing 
of ``Korporatsiya VSMPO AVISMA,'' an entity considered for inclusion on 
the MEU list but not included because the ERC determined it was not a 
`military end user' based on the criteria in Sec.  744.21(g) and (f).
    This rule also removes ``Molot Oruzhie,'' an entity located in 
Russia, from the MEU List because this entity was already listed on the 
Entity List and therefore did not require being additionally listed on 
the MEU List. The entry for ``Molot Oruzhie'' was added to the Entity 
List on December 23, 2020 (85 FR 83799). Entities on the Entity List 
are not also included on the MEU List.
    This final rule removes the following two entities, consisting of 
two entities located in Russia, from the MEU List:

Russia

     Korporatsiya Vsmpo Avisma OAO; and
     Molot Oruzhie.

Savings Clause

    Shipments of items removed from eligibility for a License Exception 
or export, reexport, or transfer (in-country) without a license (NLR) 
as a result of this regulatory action that were en route aboard a 
carrier to a port of export, reexport, or transfer (in-country), on 
[INSERT DATE OF DISPLAY ON THE PUBLIC INSPECTION DESK], pursuant to 
actual orders for export, reexport, or transfer (in-country) to or 
within a foreign destination, may proceed to that destination under the 
previous eligibility for a License Exception or export, reexport, or 
transfer (in-country) without a license (NLR).

Export Control Reform Act of 2018

    On August 13, 2018, the President signed into law the John S. 
McCain National Defense Authorization Act for Fiscal Year 2019, which 
included the Export Control Reform Act of 2018 (ECRA) (50 U.S.C. 4801-
4852). ECRA provides the legal basis for BIS's principal authorities 
and serves as the authority under which BIS issues this rule.

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, of reducing costs, of harmonizing rules, and of promoting 
flexibility. This rule has been determined to be not significant for 
purposes of Executive Order 12866. This rule is not an Executive Order 
13771 regulatory action because this rule is not significant under 
Executive Order 12866.
    2. Notwithstanding any other provision of law, no person is 
required to respond to or be subject to a penalty for failure to comply 
with a collection of information, subject to the requirements of the 
Paperwork Reduction Act of 1995 (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. This regulation involves 
collections previously approved by OMB under control number 0694-0088, 
Simplified Network Application Processing System, which includes, among 
other things, license applications, and carries a burden estimate of 
42.5 minutes for a manual or electronic submission. Total burden hours 
associated with the PRA and OMB control number 0694-0088 are not 
expected to increase as a result of this rule.
    3. This rule does not contain policies with Federalism implications 
as that term is defined in Executive Order 13132.
    4. Pursuant to Sec.  1762 of the Export Control Reform Act of 2018, 
this action is exempt from the Administrative Procedure Act (5 U.S.C. 
553) requirements for notice of proposed rulemaking, opportunity for 
public participation, and delay in effective date.
    5. Because a notice of proposed rulemaking and an opportunity for 
public comment are not required to be given for this rule by 5 U.S.C. 
553, or by any other law, the analytical requirements of the Regulatory 
Flexibility Act, 5 U.S.C. 601, et seq., are not applicable. 
Accordingly, no

[[Page 4864]]

regulatory flexibility analysis is required and none has been prepared.

List of Subjects in 15 CFR Part 744

    Exports, Reporting and recordkeeping requirements, Terrorism.

    Accordingly, part 744 of the Export Administration Regulations (15 
CFR parts 730-774) is amended as follows:

PART 744--[AMENDED]

0
1. The authority citation for 15 CFR part 744 continues to read as 
follows:

    Authority:  50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.; 50 
U.S.C. 1701 et seq.; 22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; 22 
U.S.C. 7201 et seq.; 22 U.S.C. 7210; E.O. 12058, 43 FR 20947, 3 CFR, 
1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p. 
608; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13026, 
61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13099, 63 FR 45167, 3 
CFR, 1998 Comp., p. 208; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., 
p. 783; E.O. 13224, 66 FR 49079, 3 CFR, 2001 Comp., p. 786; Notice 
of September 18, 2020, 85 FR 59641 (September 22, 2020); Notice of 
November 12, 2020, 85 FR 72897 (November 13, 2020).

0
2. Supplement No. 4 to part 744 is amended:
0
a. Under CHINA, PEOPLE'S REPUBLIC OF, by adding in alphabetical order 
an entry for ``China National Offshore Oil Corporation Ltd.''
    The addition reads as follows:

Supplement No. 4 to Part 744--Entity List

* * * * *

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                     Federal Register
              Country                             Entity                      License requirement          License review policy         citation
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
CHINA, PEOPLE'S REPUBLIC OF.......                                                       * * * * * *
                                    China National Offshore Oil        All items subjects to the EAR      Presumption of denial.  86 FR [INSERT FR PAGE
                                     Corporation Ltd., No. 25           except for:                                                NUMBER 1/15/2021].
                                     Chaoyangmen North Street,         --crude oil, condensates,
                                     Dongcheng District, Beijing,       aromatics, natural gas liquids,
                                     100010, China                      hydrocarbon gas liquids, natural
                                                                        gas plant liquids, refined
                                                                        petroleum products, liquefied
                                                                        natural gas, natural gas,
                                                                        synthetic natural gas, and
                                                                        compressed natural gas under the
                                                                        following Harmonized System (HS)
                                                                        codes: 271111, 2711210000,
                                                                        2711210000, 2709, 2709002010,
                                                                        2707, 27075000, 2710, 271019,
                                                                        271112, 271113, 271114, 271119,
                                                                        27111990, 271311, 271312,
                                                                        271012250, 2901, 290511, 2701,
                                                                        29109020, 29151310, 29155020,
                                                                        29156050, 29159020, 29161210,
                                                                        29280025, 29321910, 29362920,
                                                                        29419030, 2909300000,
                                                                        2917194500, 2922504500,
                                                                        2924296000, 2925294500,
                                                                        2928002500, 2933194350; or
                                                                       --required for the continued
                                                                        operation of joint ventures with
                                                                        persons from countries in
                                                                        Country Group A:1 in supplement
                                                                        no. 1 to part 740 of the EAR not
                                                                        operating in the South China Sea
                                                                                         * * * * * *
 
                                                                      * * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------

* * * * *

0
3. Supplement No. 7 to part 744 is amended:
0
a. Under CHINA, PEOPLE'S REPUBLIC OF, by adding in alphabetical order 
an entry for ``Beijing Skyrizon Aviation Industry Investment Co., 
Ltd.;'' and
0
b. Under RUSSIA, by removing the entries for ``Korporatsiya Vsmpo 
Avisma OAO'' and ``Molot Oruzhie.''
    The addition reads as follows:

Supplement No. 7 to Part 744--`Military End-User' (MEU) List

* * * * *

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                Country                                    Entity                      Federal Register citation
----------------------------------------------------------------------------------------------------------------
CHINA, PEOPLE'S REPUBLIC OF...........                                 * * * * * *

[[Page 4865]]

 
                                        Beijing Skyrizon Aviation Industry            86 FR [INSERT FR PAGE
                                         Investment Co., Ltd., a.k.a., the following   NUMBER 1/15/2021].
                                         one alias:
                                        --Beijing Tianjiao Aviation Industry
                                         Investment Company
 
                                        21/F Tower C Zhizhen Plaza, No. 7 Zhichun
                                         Road, Haidian District, Beijing, China.
CHINA, PEOPLE'S REPUBLIC OF...........                                 * * * * * *
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------

Matthew S. Borman,
Deputy Assistant Secretary for Export Administration.
[FR Doc. 2021-00995 Filed 1-14-21; 8:45 am]
BILLING CODE 3510-33-P