Document ID: BIS-2017-0003-0001
Agency: bis
Document Type: Rule
Title: Addition of Certain Entities to the Entity List
Posted Date: 2017-01-04T05:00Z

[Federal Register Volume 82, Number 2 (Wednesday, January 4, 2017)]
[Rules and Regulations]
[Pages 722-725]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-31969]

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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR Part 744

[Docket No. 161228999-6999-01]
RIN 0694-AH27

Addition of Certain Entities to the Entity List

AGENCY: Bureau of Industry and Security, Commerce.

ACTION: Final rule.

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SUMMARY: The Bureau of Industry and Security (BIS) amends the Export 
Administration Regulations (EAR) by adding five entities to the Entity 
List. These five entities have been determined by the U.S. Government 
to be acting contrary to the national security or foreign policy 
interests of the United States. BIS is taking this action in 
conjunction with the designations made by the Office of Foreign Asset 
Controls, Department of the Treasury, under amended Executive Order 
13694. This final rule lists these entities on the Entity List under 
the destination of Russia.

DATES: This rule is effective January 4, 2017.

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, 
Email: ERC@bis.doc.gov.

SUPPLEMENTARY INFORMATION:

Background

    The Entity List (Supplement No. 4 to part 744 of the EAR) 
identifies entities and other persons reasonably believed to be 
involved in, or that pose a significant risk of being or becoming 
involved in, activities that are contrary to the national security or 
foreign policy of the United States. The EAR imposes additional 
licensing requirements on, and limits the availability of most license 
exceptions for exports, reexports, and transfers (in-country) to those 
persons or entities listed on the Entity List. 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 Federal Register notice 
adding entities or other persons to the Entity List. BIS places 
entities on the Entity List based on certain sections of 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) is composed of representatives 
of the Departments of Commerce (Chair), State, Defense, Energy, and 
where appropriate, the Treasury. The ERC makes decisions to add an 
entry to the Entity List by majority vote and to remove or modify an 
entry by unanimous vote. The Departments represented on the ERC have 
approved these changes to the Entity List.

Entity List Additions

Additions to the Entity List

    This rule implements the decision of the agencies of the ERC to add 
five entities to the Entity List. These five entities are being added 
on the basis of Sec.  744.11 (License requirements that apply to 
entities acting contrary to the national security or foreign policy 
interests of the United States) of the EAR. The five entries being 
added to the Entity List are in Russia.
    Under Sec.  744.11(b) (Criteria for revising the Entity List) of 
the EAR, persons for whom there is reasonable cause to believe, based 
on specific and articulable facts, 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 persons may be 
added to the Entity List. The entities being added to the Entity List 
have been determined to be involved in activities that are contrary to 
the national security or foreign policy interests of the United States. 
Specifically, in this rule, BIS adds five entities to the Entity List, 
as further described below.

Entity Additions Consistent With Executive Order 13694

    Five entities are added based on activities that are described in 
Executive Order 13694 (80 FR 18077), Blocking the Property of Certain 
Persons Engaging in Significant Malicious Cyber-Enabled Activities, 
issued by the President on April 1, 2015 and amended on December 29, 
2016.
    As originally issued in April 2015, Executive Order 13694 created a 
new, targeted authority for the U.S. government to respond more 
effectively to the most significant of cyber threats, particularly in 
situations where malicious cyber actors operate beyond the reach of 
existing authorities, focusing on cyber-enabled malicious activities. 
Executive Order 13694 authorized the imposition of sanctions on 
individuals and entities determined

[[Page 723]]

to be responsible for or complicit in malicious cyber-enabled 
activities that result in enumerated harms that are reasonably likely 
to result in, or have materially contributed to, a significant threat 
to the national security, foreign policy, or economic health or 
financial stability of the United States. Under Section 8 of the 
Executive Order 13694, all agencies of the United States Government are 
directed to take all appropriate measures within their authority to 
carry out the provisions of the Order.
    On December 29, 2016, the President issued an Executive Order 
Taking Additional Steps To Address The National Emergency With Respect 
To Significant Malicious Cyber-Enabled Activities, which amended 
Executive Order 13694. With this action, the existing authorities have 
been amended to also allow for the imposition of sanctions on 
individuals and entities determined to be responsible for tampering, 
altering, or causing the misappropriation of information with the 
purpose or effect of interfering with or undermining election processes 
or institutions. Five entities and four individuals are identified in 
the Annex of the amended Executive Order and have been added to OFAC's 
list of Specially Designated Nationals and Blocked Persons (SDN List). 
OFAC also designated an additional two individuals who also were added 
to the SDN List.
    BIS, pursuant to Executive Order 13694, as amended, and in 
consultation with the Departments of State, Defense, Energy, and the 
Treasury, has designated the five entities specified in the next three 
paragraphs.
    The Main Intelligence Directorate (a.k.a., the following two 
aliases: Glavnoe Razvedyvatel'noe Upravlenie; and GRU) is involved in 
external collection using human intelligence officers and a variety of 
technical tools, and is designated for tampering, altering, or causing 
a misappropriation of information with the purpose or effect of 
interfering with the 2016 U.S. election processes.
    The Federal Security Service (FSB), (f.k.a., Esage Lab) a.k.a., 
Federalnaya Sluzhba Bezopasnosti, assisted the GRU in conducting the 
activities described above.
    There were also three other entities involved: (1) The Special 
Technology Center, (a.k.a., STLC, Ltd.) assisted the GRU in conducting 
signals intelligence operations; (2) Zorsecurity Center (a.k.a., Esage 
Lab) provided the GRU with technical research and development; and (3) 
the Autonomous Noncommercial Organization Professional Association of 
Designers of Data Processing Systems (a.k.a., ANO PO KSI) provided 
specialized training to the GRU.
    With these additions, BIS imposes on these entities a license 
requirement for exports, reexports, or transfers (in-country) of all 
items subject to the EAR and a license review policy of presumption of 
denial. The license requirement applies to any transaction in which 
items are to be exported, reexported, or transferred (in-country) to 
any of the entities or in which such entities act as purchaser, 
intermediate consignee, ultimate consignee, or end-user. 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 
Executive Order 13694.
    This final rule adds the following five entities to the Entity 
List:
Russia
    (1) Autonomous Noncommercial Organization Professional Association 
of Designers of Data Processing Systems, a.k.a., the following one 
alias:

--ANO PO KSI.

    Prospekt Mira D 68, Str 1A, Moscow 129110, Russia; and Dom 3, 
Lazurnaya Ulitsa, Solnechnogorskiy Raion, Andreyevka, Moscow Region 
141551, Russia;
    (2) Federal Security Service (FSB), a.k.a., the following one 
alias:

--Federalnaya Sluzhba Bezopasnosti.

    Ulitsa Kuznetskiy Most, Dom 22, Moscow 107031, Russia; and 
Lubyanskaya Ploschad, Dom 2, Moscow 107031, Russia;
    (3) Main Intelligence Directorate, a.k.a., the following three 
aliases

--Glavnoe Razvedyvatel'noe Upravlenie;
--GRU; and
--Main Intelligence Department.

    Khoroshevskoye Shosse 76, Khodinka, Moscow, Russia; and Ministry of 
Defence of the Russian Federation, Frunzenskaya nab., 22/2, Moscow 
119160, Russia;
    (4) Special Technology Center, a.k.a., the following one alias:

--STC, Ltd.

    Gzhatskaya 21 k2, St. Petersburg, Russia; and 21-2 Gzhatskaya 
Street, St. Petersburg, Russia; and
    (5) Zorsecurity Center (f.k.a., Esage Lab), a.k.a., the following 
one alias:

--TSOR Security.

    Luzhnetskaya Embankment \2/4\, Building 17, Office 444, Moscow 
119270, Russia.
Export Administration Act
    Although the Export Administration Act expired on August 20, 2001, 
the President, through Executive Order 13222 of August 17, 2001, 3 CFR, 
2001 Comp., p. 783 (2002), as amended by Executive Order 13637 of March 
8, 2013, 78 FR 16129 (March 13, 2013) and as extended by the Notice of 
August 4, 2016, 81 FR 52587 (August 8, 2016), has continued the Export 
Administration Regulations in effect under the International Emergency 
Economic Powers Act. BIS continues to carry out the provisions of the 
Export Administration Act, as appropriate and to the extent permitted 
by law, pursuant to Executive Order 13222, as amended by Executive 
Order 13637.
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.
    2. Notwithstanding any other provision of law, no person is 
required to respond to nor 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 
43.8 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. You may send comments 
regarding the collection of information associated with this rule, 
including suggestions for reducing the burden, to Jasmeet K. Seehra, 
Office of Management and

[[Page 724]]

Budget (OMB), by email to Jasmeet_K._Seehra@omb.eop.gov, or by fax to 
(202) 395-7285.
    3. This rule does not contain policies with Federalism implications 
as that term is defined in Executive Order 13132.
    4. The provisions of the Administrative Procedure Act (5 U.S.C. 
553) requiring notice of proposed rulemaking, the opportunity for 
public comment and a delay in effective date are inapplicable because 
this regulation involves a military or foreign affairs function of the 
United States. (See 5 U.S.C. 553(a)(1)). BIS implements this rule to 
protect U.S. national security or foreign policy interests by 
preventing items from being exported, reexported, or transferred (in 
country) to the entities being added to the Entity List. If the 
effective date of this rule were delayed to allow for notice and 
comment, then the entities being added to the Entity List by this 
action would continue to be able to receive items without a license and 
to conduct activities contrary to the national security or foreign 
policy interests of the United States. In addition, publishing a 
proposed rule would give these parties notice of the U.S. Government's 
intention to place them on the Entity List and would create an 
incentive for these persons to either accelerate their receipt of items 
subject to the EAR to conduct activities that are contrary to the 
national security or foreign policy interests of the United States, 
and/or to take steps to set up additional aliases, change addresses, 
and/or take other measures to try to limit the impact of the listing on 
the Entity List once a final rule is published.
    Further, no other law requires that a notice of proposed rulemaking 
and an opportunity for public comment be given for this rule. 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.

    For the reasons stated in the preamble, the Bureau of Industry and 
Security amends part 744 of the Export Administration Regulations (15 
CFR parts 730-774) 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. 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. 12947, 60 FR 5079, 3 CFR, 
1995 Comp., p. 356; 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 November 12, 2015, 80 FR 70667 
(November 13, 2015); Notice of January 20, 2016, 81 FR 3937 (January 
22, 2016); Notice of August 4, 2016, 81 FR 52587 (August 8, 2016); 
Notice of September 15, 2016, 81 FR 64343 (September 19, 2016).

0
2. Supplement No. 4 to part 744 is amended by adding under the 
destination of Russia, in alphabetical order, five Russian entities.
    The additions 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
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
RUSSIA
 
                                                   * * * * * *
                               Autonomous Noncommercial    For all items      Presumption of    82 FR [INSERT FR
                                Organization Professional   subject to the     denial.           PAGE NUMBER AND
                                Association of Designers    EAR. (See Sec.                       1/4/2017]
                                of Data Processing          744.11 of the
                                Systems, a.k.a., the        EAR)
                                following one alias:
                               --ANO PO KSI
                               Prospekt Mira D 68, Str
                                1A, Moscow 129110,
                                Russia; and Dom 3,
                                Lazurnaya Ulitsa,
                                Solnechnogorskiy Raion,
                                Andreyevka, Moscow Region
                                141551, Russia
 
                                                   * * * * * *
                               Federal Security Service    For all items      Presumption of    82 FR [INSERT FR
                                (FSB), a.k.a., the          subject to the     denial.           PAGE NUMBER AND
                                following one alias:        EAR. (See Sec.                       1/4/2017]
                               --Federalnaya Sluzhba        744.11 of the
                                Bezopasnosti                EAR)
                               Ulitsa Kuznetskiy Most,
                                Dom 22, Moscow 107031,
                                Russia; and Lubyanskaya
                                Ploschad, Dom 2, Moscow
                                107031, Russia
 

[[Page 725]]

 
                                                   * * * * * *
                               Main Intelligence           For all items      Presumption of    82 FR [INSERT FR
                                Directorate, a.k.a., the    subject to the     denial.           PAGE NUMBER AND
                                following three aliases:    EAR. (See Sec.                       1/4/2017]
                               --Glavnoe Razvedyvatel'noe   744.11 of the
                                Upravlenie;                 EAR)
                               --GRU; and
                               --Main Intelligence
                                Department
                               Khoroshevskoye Shosse 76,
                                Khodinka, Moscow, Russia;
                                and Ministry of Defence
                                of the Russian
                                Federation, Frunzenskaya
                                nab., 22/2, Moscow
                                119160, Russia
 
                                                   * * * * * *
                               Special Technology Center,  For all items      Presumption of    82 FR [INSERT FR
                                a.k.a., the following one   subject to the     denial.           PAGE NUMBER AND
                                alias:                      EAR. (See Sec.                       1/4/2017]
                               --STC, Ltd                   744.11 of the
                                                            EAR)
                               Gzhatskaya 21 k2, St.
                                Petersburg, Russia; and
                                21-2 Gzhatskaya Street,
                                St. Petersburg, Russia.
 
                                                   * * * * * *
                               Zorsecurity Center          For all items      Presumption of    82 FR [INSERT FR
                                (f.k.a., Esage Lab),        subject to the     denial.           PAGE NUMBER AND
                                a.k.a., the following one   EAR. (See Sec.                       1/4/2017]
                                alias:                      744.11 of the
                               --TSOR Security              EAR)
                               Luzhnetskaya Embankment \2/
                                4\, Building 17, Office
                                444, Moscow 119270,
                                Russia
 
                                                   * * * * * *
----------------------------------------------------------------------------------------------------------------

    Dated: December 29, 2016.
Eric L. Hirschhorn,
Under Secretary of Commerce for Industry and Security.
[FR Doc. 2016-31969 Filed 12-30-16; 4:15 pm]
BILLING CODE 3510-33-P