Document ID: BIS-2022-0035-0001
Agency: bis
Document Type: Rule
Title: Revisions to the Unverified List and the Entity List
Posted Date: 2022-12-16T05:00Z

[Federal Register Volume 87, Number 241 (Friday, December 16, 2022)]
[Rules and Regulations]
[Pages 76924-76928]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-27149]

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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

15 CFR Part 744

[Docket No. 221209-0268]
RIN 0694-AJ02

Revisions to the Unverified List and the Entity List

AGENCY: Bureau of Industry and Security, Department of Commerce.

ACTION: Final rule.

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SUMMARY: The Bureau of Industry and Security (BIS) is amending the 
Export Administration Regulations (EAR) by removing 9 persons from the 
Unverified List (UVL) and adding them to the Entity List, all under the 
destination of Russia. BIS has been unable to verify the bona fides of 
all 9 persons being removed from the UVL and added to the Entity List, 
due to the foreign government's prevention of timely end-use checks. 
BIS is also amending the

[[Page 76925]]

EAR by removing 27 persons from the UVL, one under the destination of 
Pakistan and 26 under the destination of China, because BIS was able to 
verify their bona fides.

DATES: This rule is effective: December 16, 2022.

FOR FURTHER INFORMATION CONTACT: For questions on the Entity List 
revisions, contact: Chair, End-User Review Committee, Office of the 
Assistant Secretary for Export Administration, Bureau of Industry and 
Security, Department of Commerce, Phone: (202) 482-5991, Email: 
[email protected].
    For questions on the Unverified List revisions, contact: Linda 
Minsker, Director, Office of Enforcement Analysis, Phone: (202) 482-
4255, Email: [email protected].

SUPPLEMENTARY INFORMATION: 

Background

Entity List Changes

    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, pursuant to Sec.  744.11(b). The 
EAR impose additional license requirements on, and limit the 
availability of most license exceptions for, exports, reexports, and 
transfers (in-country) when a listed entity is a party to the 
transaction. 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 that added the entity to the 
Entity List. The Bureau of Industry and Security (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. The ERC makes 
all decisions to add an entry to the Entity List by majority vote and 
makes all decisions to remove or modify an entry by unanimous vote.

Additions to the Entity List and Removal From the Unverified List

    The ERC determined to add the following entities to the Entity List 
pursuant to Sec.  744.11(b)(4)(ii) under the destination of Russia: 
Alliance EG Ltd.; FSUE Rosmorport Far Eastern Basin Branch; Intercom 
Ltd.; Nasosy Ampika; Nuclin LLC; SDB IRE RAS; Security 2 Business 
Academy; Tavrida Microelectronics; and VIP Technology Ltd. These 
entities are being added due to the long-term (60 days or greater) 
prevention of a successful end-use check conducted by or on behalf of 
BIS. Specifically, there has been a sustained lack of cooperation by 
the host government to schedule and facilitate the completion of a 
timely end-use check of persons listed on the Unverified List. As a 
result of the sustained inability to conduct an end-use check, there is 
an unacceptable risk of diversion or misuse of items subject to the 
EAR. The ERC believes that prior review of exports, reexports, or 
transfers (in-country) involving the entities and the possible 
imposition of license conditions or license denial enhance BIS's 
ability to prevent violations of the EAR. These entities are added to 
the Entity List with a license requirement for all items subject to the 
EAR. BIS will review license applications pertaining to these entities 
under a policy of denial, pursuant to Sec.  746.8(b). No license 
exceptions are available for exports, reexports, or transfers (in-
country) to these entities.
    As a conforming change, each of the entities added to the Entity 
List by this rule is also removed from the Unverified List. For other 
changes to the Unverified List made by this rule, which are separate 
from this action, please see below.

Unverified List Changes

    The UVL, found in supplement no. 6 to part 744 of the EAR, contains 
the names and addresses of foreign persons who are or have been parties 
to a transaction, as described in Sec.  748.5 of the EAR, involving the 
export, reexport, or transfer (in-country) of items subject to the EAR. 
These foreign persons are added to the UVL because BIS or federal 
officials acting on BIS's behalf were unable to verify their bona fides 
(i.e., legitimacy and reliability relating to the end use and end user 
of items subject to the EAR) through the completion of an end-use 
check. Sometimes these checks, such as a pre-license check (PLC) or a 
post-shipment verification (PSV), cannot be completed satisfactorily 
for reasons outside the U.S. Government's control.
    There are any number of reasons why these checks cannot be 
completed to the satisfaction of the U.S. Government. The reasons 
include, but are not limited to: (1) reasons unrelated to the 
cooperation of the foreign party subject to the end-use check (for 
example, BIS sometimes initiates end-use checks but is unable to 
complete them because the foreign party cannot be found at the address 
indicated on the associated export documents and BIS cannot contact the 
party by telephone or email); (2) reasons related to a lack of 
cooperation by the host government that fails to schedule and 
facilitate the completion of an end-use check, for example by host 
government agencies' lack of responses to requests to conduct end-use 
checks, actions preventing the scheduling of such checks, or refusals 
to schedule checks in a timely manner; or (3) when, during the end-use 
check, a recipient of items subject to the EAR is unable to produce the 
items that are the subject of the end-use check for visual inspection 
or provide sufficient documentation or other evidence to confirm the 
disposition of the items.
    BIS's inability to confirm the bona fides of foreign persons 
subject to end-use checks for the reasons described above raises 
concerns about the suitability of such persons as participants in 
future exports, reexports, or transfers (in-country) of items subject 
to the EAR; this also indicates a risk that such items may be diverted 
to prohibited end uses and/or end users. Under such circumstances, 
there may not be sufficient information to add the foreign person at 
issue to the Entity List under Sec.  744.11 of the EAR. Therefore, BIS 
may add the foreign person to the UVL.
    As provided in Sec.  740.2(a)(17) of the EAR, the use of license 
exceptions for exports, reexports, and transfers (in-country) involving 
a party or parties to the transaction who are listed on the UVL is 
suspended. Additionally, under Sec.  744.15(b) of the EAR, there is a 
requirement for exporters, re-exporters, and transferors to obtain (and 
maintain a record of) a UVL statement from a party or parties to the 
transaction who are listed on the UVL before proceeding with exports, 
reexports, and transfers (in-country) to such persons, when the 
exports, reexports and transfers (in-country) are not subject to a 
license requirement. Finally, pursuant to Sec.  758.1(b)(8), Electronic 
Export Information (EEI) must be filed in the Automated Export System 
(AES) for all exports of tangible items subject to the EAR where 
parties to the transaction, as described in Sec.  748.5(d) through (f), 
are listed on the UVL.

[[Page 76926]]

    Requests for the removal of a UVL entry must be made in accordance 
with Sec.  744.15(d) of the EAR. Decisions regarding the removal or 
modification of UVL entry will be made by the Deputy Assistant 
Secretary for Export Enforcement, based on a demonstration by the 
listed person of their bona fides.

Removals From the UVL

    This final rule removes 27 persons from the UVL after BIS was able 
to verify their bona fides. This rule removes ENGRO Polymer & Chemicals 
Limited under the destination of Pakistan and the following 26 persons 
under the destination of China: ``Beijing Naura Magnetoelectric 
Technology Co., Ltd.;'' ``CCIC Southern Electronic Product Testing Co., 
Ltd.;'' ``Center for High Pressure Science and Technology Advanced 
Research;'' ``Changchun National Extreme Precision Optics Co., Ltd.;'' 
``Chinese Academy of Geological Sciences, Institute of Mineral 
Resources;'' ``Chinese Academy of Science (CAS) Institute of 
Chemistry;'' ``Dongguan Durun Optical Technology Co., Ltd.;'' ``Foshan 
Huaguo Optical Co., Ltd.;'' ``Guangdong University of Technology;'' 
``Guangxi Intai Technology Co., Ltd.;'' ``Guangxi Yuchai Machinery Co., 
Ltd.;'' ``Guangzhou Hymson Laser Technology Co., Ltd.;'' ``Heshan Deren 
Electronic Technology Co., Ltd.;'' ``Hubei Longchang Optical Co., 
Ltd.;'' ``Hubei Sinophorus Electronic Materials Co., Ltd.;'' ``Kunshan 
Heng Rui Cheng Industrial Technology;'' ``Shanghai Fansheng 
Optoelectronic Science & Technology Co. Ltd.;'' ``Shanghai Micro 
Electronics Equipment (Group) Co., Ltd.;'' ``ShanghaiTech University;'' 
``Southern University of Science and Technology, Department of 
Mechanical and Energy Engineering;'' ``University of Chinese Academy of 
Sciences, School of Chemical Sciences;'' ``University of Shanghai for 
Science and Technology;'' ``Vital Advanced Materials Co., Ltd.;'' 
``Wuhan Juhere Photonic Tech Co., Ltd.;'' ``Wuxi Biologics (Shanghai) 
Co., Ltd.;'' and ``Zhongshan Thincloud Optics Co., Ltd.;''. BIS is 
removing these 27 persons pursuant to Sec.  744.15(c)(2) of the EAR.
    Removal of a person from the UVL because BIS was able to verify 
their bona fides does not affect any other section of the EAR that 
imposes a license requirement for exports, reexports, transfers (in-
country), or exports from abroad or activities of U.S. persons. In 
addition, this action does not preclude subsequent action, including 
adding such persons to the Entity List pursuant to part 744 of the EAR.

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. 
Sections 4801-4852. ECRA provides the legal basis for BIS's principal 
authorities and serves as the authority under which BIS issues this 
final rule.

Savings Clause

    For the changes being made in this final rule, 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 
PUBLICATION IN THE FEDERAL REGISTER], 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).

Executive Order Requirements

    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, distribute 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 final rule is not a ``significant regulatory action'' 
under Executive Order 12866.
    This rule does not contain policies with Federalism implications as 
that term is defined under Executive Order 13132.

Paperwork Reduction Act Requirements

    Notwithstanding any other provision of law, no person is required 
to respond to, nor is 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.
    The Entity List additions involves collections previously approved 
by OMB under control number 0694-0088, Simplified Network Application 
Processing System, which includes, among other things, license 
applications and commodity classifications, and carries a burden 
estimate of 29.4 minutes for a manual or electronic submission for a 
total burden estimate of 33,133 hours. Total burden hours associated 
with the PRA and OMB control number 0694-0088 are not expected to 
increase as a result of this rule.
    BIS believes that the overall increases in burdens and costs will 
be minimal and will fall within the already approved amounts for these 
existing collections.

Administrative Procedure Act and Regulatory Flexibility Act 
Requirements

    Pursuant to Section 4821 of ECRA, this action is exempt from the 
Administrative Procedure Act (5 U.S.C. 553) requirements for notice of 
proposed rulemaking and opportunity for public participation.
    Further, no other law requires notice of proposed rulemaking or 
opportunity for public comment for this final rule. Because a notice of 
proposed rulemaking and an opportunity for public comment are not 
required under the Administrative Procedure Act or by any other law, 
the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 
601 et seq.) are not applicable.

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 through 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 19, 2022, 87 FR 57569 (September 21, 2022); Notice of 
November 8, 2022, 87 FR 68015 (November 10, 2022).

0
2. Amend Supplement no. 4 to part 744 under RUSSIA, by adding in 
alphabetical order, entries for ``Alliance

[[Page 76927]]

EG Ltd.'', ``FSUE Rosmorport Far Eastern Basin Branch'', ``Intercom 
Ltd.'', ``Nasosy Ampika'', ``Nuclin LLC'', ``SDB IRE RAS'', ``Security 
2 Business Academy'', ``Tavrida Microelectronics'', and ``VIP 
Technology Ltd.'' to 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.................                                         * * * * * *
                         Alliance EG Ltd., Leninsky    For all items       Policy of denial.   87 FR [INSERT FR
                          Prospect 139, Office 310      subject to the      See Sec.            PAGE NUMBER],
                          St., Petersburg 198216,       EAR. (See Sec.      746.8(b).           December 16,
                          Russia.                       744.11 of the                           2022.
                                                        EAR).
                                                                * * * * * *
                         FSUE Rosmorport Far Eastern   For all items       Policy of denial.   87 FR [INSERT FR
                          Basin Branch,                 subject to the      See Sec.            PAGE NUMBER],
                          Nizhneportovaya Street 3      EAR. (See Sec.      746.8(b).           December 16,
                          Primorskiy Territory,         744.11 of the                           2022.
                          Vladivostok 690003, Russia.   EAR).
                                                                * * * * * *
                         Intercom Ltd., Kalinina       For all items       Policy of denial.   87 FR [INSERT FR
                          Street 13 Saint Petersburg    subject to the      See Sec.            PAGE NUMBER],
                          198099, Russia.               EAR. (See Sec.      746.8(b).           December 16,
                                                        744.11 of the                           2022.
                                                        EAR).
                                                                * * * * * *
                         Nasosy Ampika, 3-ya           For all items       Policy of denial.   87 FR [INSERT FR
                          Institutskaya St. Bld. 15     subject to the      See Sec.            PAGE NUMBER],
                          Moscow, Russia.               EAR. (See Sec.      746.8(b).           December 16,
                                                        744.11 of the                           2022.
                                                        EAR).
                                                                * * * * * *
                         Nuclin LLC, Serebryakova      For all items       Policy of denial.   87 FR [INSERT FR
                          Proezd 14 Moscow, Russia.     subject to the      See Sec.            PAGE NUMBER],
                                                        EAR. (See Sec.      746.8(b).           December 16,
                                                        744.11 of the                           2022.
                                                        EAR).
                                                                * * * * * *
                         SDB IRE RAS, 1 Vvedenskogo    For all items       Policy of denial.   87 FR [INSERT FR
                          Square Fryazino, Russia.      subject to the      See Sec.            PAGE NUMBER],
                                                        EAR. (See Sec.      746.8(b).           December 16,
                                                        744.11 of the                           2022.
                                                        EAR).
                         Security 2 Business Academy,  For all items       Policy of denial.   87 FR [INSERT FR
                          a.k.a., the following two     subject to the      See Sec.            PAGE NUMBER],
                          aliases:                      EAR. (See Sec.      746.8(b).           December 16,
                         -- S2BA                        744.11 of the                           2022.
                         --Academy of Business          EAR).
                          Security.
                         Deguninskaya Street 10
                          Moscow, Russia; and
                          Novoslobodskaya Str. 14/19
                          Moscow, Russia.
                                                                * * * * * *
                         Tavrida Microelectronics,     For all items       Policy of denial.   87 FR [INSERT FR
                          Zelenaya Street 1             subject to the      See Sec.            PAGE NUMBER],
                          Dolgoprudnyy Moscow 141700,   EAR. (See Sec.      746.8(b).           December 16,
                          Russia.                       744.11 of the                           2022.
                                                        EAR).
                                                                * * * * * *
                         VIP Technology Ltd.,          For all items       Policy of denial.   87 FR [INSERT FR
                          Bechtereva Street 3/2,        subject to the      See Sec.            PAGE NUMBER],
                          Office 40 Saint Petersburg    EAR. (See Sec.      746.8(b).           December 16,
                          192019, Russia.               744.11 of the                           2022.
                                                        EAR).
                                                                * * * * * *
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------

* * * * *

0
3. Supplement no. 6 to part 744 is amended by:
0
a. Under CHINA, PEOPLE'S REPUBLIC OF, removing the following entries: 
``Beijing Naura Magnetoelectric Technology Co., Ltd.'', ``CCIC Southern 
Electronic Product Testing Co., Ltd .'', ``Center for High Pressure 
Science and Technology Advanced Research'', ``Changchun National 
Extreme Precision Optics Co., Ltd.'', ``Chinese Academy of Geological 
Sciences, Institute of Mineral Resources'', ``Chinese Academy of 
Science (CAS) Institute of Chemistry'', ``Dongguan Durun Optical 
Technology Co., Ltd.'', ``Foshan Huaguo Optical Co., Ltd.'', 
``Guangdong University of Technology'', ``Guangxi Intai Technology Co., 
Ltd.'', ``Guangxi Yuchai Machinery Co., Ltd.'', ``Guangzhou Hymson 
Laser Technology Co., Ltd.'', ``Heshan Deren Electronic Technology Co., 
Ltd.'', ``Hubei Longchang Optical Co., Ltd.'', ``Hubei Sinophorus 
Electronic Materials Co., Ltd.'', ``Kunshan Heng Rui Cheng Industrial 
Technology'', ``Shanghai Fansheng Optoelectronic Science & Technology 
Co., Ltd.'', ``Shanghai Micro Electronics Equipment (Group) Co., 
Ltd.'', ``ShanghaiTech University'', ``Southern University of Science 
and Technology, Department of Mechanical and Energy Engineering'', 
``University of Chinese Academy of Sciences, School of Chemical 
Sciences'', ``University of Shanghai for Science and Technology'', 
``Vital Advanced Materials Co., Ltd.'', ``Wuhan Juhere Photonic Tech 
Co., Ltd.'', ``Wuxi Biologics (Shanghai) Co., Ltd.'', and ``Zhongshan 
Thincloud Optics Co., Ltd.'';
0
b. Under PAKISTAN, removing the entry for ``ENGRO Polymer & Chemicals 
Limited''; and
0
c. Under RUSSIA, removing the following entries: ``Alliance EG Ltd.'',

[[Page 76928]]

``FSUE Rosmorport Far Eastern Basin Branch'', ``Intercom Ltd.'', 
``Nasosy Ampika'', ``Nuclin LLC'', ``SDB IRE RAS'', ``Security 2 
Business Academy'', ``Tavrida Microelectronics'', and ``VIP Technology 
Ltd.''

Matthew S. Borman,
Deputy Assistant Secretary for Export Administration.
[FR Doc. 2022-27149 Filed 12-15-22; 8:45 am]
BILLING CODE 3510-33-P