Document ID: BIS-2021-0031-0001
Agency: bis
Document Type: Rule
Title: Addition of Entities and Revision of Entry on the Entity List
Posted Date: 2021-07-19T04:00Z

[Federal Register Volume 86, Number 135 (Monday, July 19, 2021)]
[Rules and Regulations]
[Pages 37901-37904]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-15362]

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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR Part 744

[Docket No. 210707-0145]
RIN 0694-AI53

Addition of Entities and Revision of Entry on the Entity 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 six entities to 
the Entity List. These six entities, all of which are being added under 
the destination of Russia, have been determined by the U.S. Government 
to be acting contrary to the national security or foreign policy 
interests of the United States and are being added consistent with 
Executive Order 14024, Blocking Property With Respect To Specified 
Harmful Foreign Activities of the Government of the Russian Federation, 
issued on April 15, 2021. This rule also corrects one existing entry on 
the Entity List under the destination of Russia.

DATES: This rule is effective July 19, 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 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 document 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 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. The Departments represented on the ERC 
approved these changes to the Entity List.

Entity List Decisions

A. Entity Additions Consistent With Executive Order 14024

    In this final rule, six entities are added to the Entity List on 
the basis of activities that are described in Executive Order (E.O.) 
14024 (86 FR 20249, April 19, 2021), Blocking Property With Respect To 
Specified Harmful Foreign Activities of the Government of the Russian 
Federation, issued on April 15, 2021. In E.O. 14024, the President 
found that specified harmful foreign activities of the Russian 
government constitute an unusual and extraordinary threat to the 
national security, foreign policy, and economy of the United States. In 
issuing E.O. 14024, the President declared a national emergency to deal 
with this threat.
    E.O. 14024 elevates the U.S. government's capacity to deploy 
strategic and economically impactful sanctions to deter and respond to 
Russia's destabilizing behavior and to counter Russia's harmful foreign 
activities that threaten the national security and foreign policy of 
the United States, including: Undermining the conduct of free and fair 
elections and democratic institutions in the United States and its 
allies and partners; engaging in and facilitating malicious cyber 
activities against the United States and its allies and partners that 
threaten the free flow of information; fostering and using 
transnational corruption to influence foreign governments; pursuing 
extraterritorial activities targeting dissidents or journalists; 
undermining security in countries and regions important to the United 
States' national security; and violating well-established principles of 
international law, including respect for the territorial integrity of 
states. To address these threats, E.O. 14024 authorizes sanctions on a 
wide range of persons, including, among others, those operating in the 
technology and defense and related materiel sectors of the Russian 
economy and in any additional sectors of the Russian economy as may be 
determined by the Secretary of the Treasury, in consultation with the 
Secretary of State.
    The Department of the Treasury's Office of Foreign Assets Control 
(OFAC) has designated the following six entities as being within the 
scope of E.O. 14024: Aktsionernoe Obshchestvo AST; Aktsionernoe 
Obshchestvo Pasit; Aktsionernoe Obshchestvo Pozitiv Teknolodzhiz; 
Federal State Autonomous Institution Military Innovative Technopolis 
Era; Federal

[[Page 37902]]

State Autonomous Scientific Establishment Scientific Research Institute 
Specialized Security Computing Devices and Automation; and Obshchestvo 
S Ogranichennoi Otvetstvennostyu NEOBIT. OFAC's first use of E.O. 14024 
targeted companies operating in the technology sector of the Russian 
economy that support Russian intelligence services.
    In conjunction with OFAC's designation, BIS is taking concurrent 
action to ensure the efficacy of existing sanctions on Russia that 
target aggressive and harmful activities by the Russian government. BIS 
is adding the six entities designated by OFAC--Aktsionernoe Obshchestvo 
AST; Aktsionernoe Obshchestvo Pasit; Aktsionernoe Obshchestvo Pozitiv 
Teknolodzhiz; Federal State Autonomous Institution Military Innovative 
Technopolis Era; Federal State Autonomous Scientific Establishment 
Scientific Research Institute Specialized Security Computing Devices 
and Automation; and Obshchestvo S Ogranichennoi Otvetstvennostyu 
NEOBIT--to the Entity List, and is imposing a license requirement for 
exports, reexports, or transfers (in-country) of all items subject to 
the EAR to these blocked persons. This concurrent action by BIS will 
complement the actions already taken by OFAC by ensuring that U.S. 
sanctions on these entities will apply to all items subject to the EAR 
regardless of whether a U.S. person is involved in the transaction or 
whether the transaction involves the U.S. financial system. BIS imposes 
a license review policy of a presumption of denial for these six 
entities. In addition, no license exceptions are available for exports, 
reexports, or transfers (in-country) to the persons being added to the 
Entity List in this rule. This license requirement implements an 
appropriate measure within the authority of the EAR to carry out the 
provisions of E.O. 14024.

Russia

     Aktsionernoe Obshchestvo AST;
     Aktsionernoe Obshchestvo Pasit;
     Aktsionernoe Obshchestvo Pozitiv Teknolodzhiz;
     Federal State Autonomous Institution Military Innovative 
Technopolis Era;
     Federal State Autonomous Scientific Establishment 
Scientific Research Institute Specialized Security Computing Devices 
and Automation; and
     Obshchestvo S Ogranichennoi Otvetstvennostyu NEOBIT.

B. Correction to the Entity List

    This final rule implements a correction to one existing entry on 
the Entity List under Russia. The correction is for the entity, Federal 
Security Service (FSB). This entity was added to the EAR on January 4, 
2017 (82 FR 724, January 4, 2017). The License Requirement for this 
entity applies to all items subject to the EAR, apart from items that 
are related to transactions that are authorized by OFAC pursuant to 
their February 2, 2017, General License No. 1 (``Authorizing Certain 
Transactions with the Federal Security Service''). Effective March 2, 
2021, General License No. 1A, dated March 15, 2018, was replaced and 
superseded in its entirety by General License No. 1B (``Authorizing 
Certain Transactions with the Federal Security Service''). This final 
rule corrects the existing entry's License Requirement column by 
inserting General License 1B for reference to OFAC's General License 
No. 1, and amends the effective date from February 2, 2017, to the 
current effective date of March 2, 2021.
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 
July 19, 2021, 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). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This final rule has been designated to be not significant for purposes 
of E.O. 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 
29.6 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 E.O. 13132.
    4. Pursuant to section 1762 of ECRA (see 50 U.S.C. 4821), 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 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:

[[Page 37903]]

PART 744--[AMENDED]

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

    Authority: 50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.; 50 
U.S.C. 1701 et seq.; 22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; 22 
U.S.C. 7201 et seq.; 22 U.S.C. 7210; E.O. 12058, 43 FR 20947, 3 CFR, 
1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p. 
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 in the table under RUSSIA:
0
a. By adding in alphabetical order entries for ``Aktsionernoe 
Obshchestvo AST'', ``Aktsionernoe Obshchestvo Pasit'', and 
``Aktsionernoe Obshchestvo Pozitiv Teknolodzhiz'';
0
b. By revising the entry for ``Federal Security Service (FSB)''; and
0
c. By adding in alphabetical order entries for ``Federal State 
Autonomous Institution Military Innovative Technopolis Era'', ``Federal 
State Autonomous Scientific Establishment Scientific Research Institute 
Specialized Security Computing Devices and Automation'', and 
``Obshchestvo S Ogranichennoi Otvetstvennostyu NEOBIT''.
    The additions and revision read as follows:

Supplement No. 4 to Part 744--Entity List

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                                                             License         License review     Federal Register
        Country                     Entity                 requirement           policy             citation
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                                                  * * * * * * *
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RUSSIA.................                                         * * * * * *
                         Aktsionernoe Obshchestvo      For all items       Presumption of      86 FR [INSERT FR
                          AST, a.k.a., the following    subject to the      denial.             PAGE NUMBER]
                          one alias:                    EAR. (See Sec.                          July 19, 2021.
                         --Advanced Systems             744.11 of the
                          Technology, AO.               EAR).
                         d. 3k2 str. 4 etazh 5 kom.
                          55, shosse Kashirskoe,
                          Moscow 115230, Russia.
                         Aktsionernoe Obshchestvo      For all items       Presumption of      86 FR [INSERT FR
                          Pasit, a.k.a., the            subject to the      denial.             PAGE NUMBER]
                          following one alias:          EAR. (See Sec.                          July 19, 2021
                         --Pasit, AO.                   744.11 of the
                                                        EAR).
                         Avenue Leninsky, Building
                          30, Premise IA, Moscow,
                          11934, Russia.
                         Aktsionernoe Obshchestvo      For all items       Presumption of      86 FR [INSERT FR
                          Pozitiv Teknolodzhiz,         subject to the      denial..            PAGE NUMBER]
                          a.k.a., the following two     EAR. (See Sec.                          July 19, 2021.
                          aliases:                      744.11 of the
                                                        EAR).
                         --JSC Positive Technologies;
                          and
                         --Pozitiv Teknolodzhiz, AO.
                         d. 23A pom. V kom, 30,
                          shosse Shchelkovskoe,
                          Moscow, 107241, Russia.
                                                                * * * * * *
                         Federal Security Service      For all items       Presumption of      82 FR 724, 1/4/
                          (FSB), a.k.a., the            subject to the      denial.             17.
                          following one alias:          EAR (see Sec.                          82 FR 18219, 4/18/
                         --Federalnaya Sluzhba          744.11 of the                           17.
                          Bezopasnosti.                 EAR), apart from                       86 FR [INSERT FR
                         Ulitsa Kuznetskiy Most, Dom    items that are                          PAGE NUMBER]
                          22, Moscow 107031, Russia;    related to                              July 19, 2021.
                          and Lubyanskaya Ploschad,     transactions that
                          Dom 2, Moscow 107031,         are authorized by
                          Russia.                       the Department of
                                                        the Treasury's
                                                        Office of Foreign
                                                        Assets Control
                                                        pursuant to
                                                        General License
                                                        No. 1B of March
                                                        2, 2021.
                         Federal State Autonomous      For all items       Presumption of      86 FR [INSERT FR
                          Institution Military          subject to the      denial.             PAGE NUMBER]
                          Innovative Technopolis Era,   EAR. (See Sec.                          July 19, 2021.
                          a.k.a., the following two     744.11 of the
                          aliases:                      EAR).
                         --ERA Military Innovation
                          Technopolis; and
                         --FGAU VIT ERA.
                         Pionerskiy Prospekt, 41
                          Anapa Krasnodar Krai
                          353456, Russia.
                         Federal State Autonomous      For all items       Presumption of      86 FR [INSERT FR
                          Scientific Establishment      subject to the      denial.             PAGE NUMBER]
                          Scientific Research           EAR. (See Sec.                          July 19, 2021.
                          Institute Specialized         744.11 of the
                          Security Computing Devices    EAR).
                          and Automation, a.k.a., the
                          following one alias:
                         --FGANU NII
                          Specvuzavtomatika.
                         Rostov-On-Don, Russia.
                                                                * * * * * *
                         Obshchestvo S Ogranichennoi   For all items       Presumption of      86 FR [INSERT FR
                          Otvetstvennostyu NEOBIT,      subject to the      denial.             PAGE NUMBER]
                          a.k.a., the following one     EAR. (See Sec.                          July 19, 2021.
                          alias:                        744.11 of the
                         --NEOBIT, OOO.                 EAR).

[[Page 37904]]

 
                         d. 21 litera G, ul.
                          Gzhatskaya, St. Petersburg,
                          195220, Russia.
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Matthew S. Borman,
Deputy Assistant Secretary for Export Administration.
[FR Doc. 2021-15362 Filed 7-16-21; 8:45 am]
BILLING CODE 3510-33-P