regulations issued pursuant to this subsection. The 
regulations issued pursuant to this section shall ex-
pressly provide that the exceptions set forth in para-
graph (2) do not permit activities or agreements (ex-
pressed or implied by a course of conduct, including 
a pattern of responses) that are otherwise prohib-
ited, pursuant to the intent of such exceptions. 
(c) ADDITIONAL REGULATIONS AND REPORTS.—
(1) REGULATIONS.—In addition to the regula-
tions issued pursuant to subsection (b), regulations 
issued pursuant to title III shall implement the pur-
poses set forth in subsection (a).
(2) REPORTS BY UNITED STATES PERSONS.—
The regulations shall require that any United States 
person receiving a request to furnish information, 
enter into or implement an agreement, or take any 
other action referred to in subsection (a) shall report 
that request to the Secretary, together with any 
other information concerning the request that the 
Secretary determines appropriate. The person shall 
also submit to the Secretary a statement regarding 
whether the person intends to comply, and whether 
the person has complied, with the request. Any re-
port filed pursuant to this paragraph shall be made 
available promptly for public inspection and copying,
except that information regarding the quantity, de-
scription, and value of any item to which such report 
relates may be treated as confidential if the Sec-
retary determines that disclosure of that information 
would place the United States person involved at a 
competitive disadvantage. The Secretary shall peri-
odically transmit summaries of the information con-
tained in the reports to the Secretary of State for 
such action as the Secretary of State, in consultation 
with the Secretary, considers appropriate to carry 
out the purposes set forth in subsection (a). 
(d) PREEMPTION.—The provisions of this section and 
the regulations issued under this section shall preempt any 
law, rule, or regulation that—
(1) is a law, rule, or regulation of any of the 
several States or the District of Columbia, or any of 
the territories or possessions of the United States, 
or of any governmental subdivision thereof; and 
(2) pertains to participation in, compliance 
with, implementation of, or the furnishing of infor-
mation regarding restrictive trade practices or boy-
cotts fostered or imposed by foreign countries 
against other countries. 
SEC. 503. PENALTIES. 
(a) CRIMINAL PENALTIES.—
(1) VIOLATIONS BY AN INDIVIDUAL.—Any indi-
vidual who willfully violates, conspires to violate, or 
attempts to violate any provision of this Act or any 
regulation, license, or order issued under this Act 
shall be fined up to 10 times the value of the exports 
involved or $1,000,000, whichever is greater, impris-
oned for not more than 10 years, or both, for each 
violation. 
(2) VIOLATIONS BY A PERSON OTHER THAN AN 
INDIVIDUAL.—Any person other than an individual 
who willfully violates, conspires to violate, or at-
tempts to violate any provision of this Act or any 
regulation, license, or order issued under this Act 
shall be fined up to 10 times the value of the exports 
involved or $5,000,000, whichever is greater, for 
each violation. 
(b) FORFEITURE OF PROPERTY INTEREST AND PRO-
CEEDS.—
(1) FORFEITURE.—Any person who is convicted 
under paragraph (1) or (2) of subsection (a) shall, 
in addition to any other penalty, forfeit to the 
United States—
(A) any of that person’s security or other 
interest in, claim against, or property or con-
tractual rights of any kind in the tangible items 
that were the subject of the violation; 
(B) any of that person’s security or other 
interest in, claim against, or property or con-
tractual rights of any kind in the tangible prop-
erty that was used in the export or attempt to 
export that was the subject of the violation; and 
(C) any of that person’s property consti-
tuting, or derived from, any proceeds obtained 
directly or indirectly as a result of the violation. 
(2) PROCEDURES.—The procedures in any for-
feiture under this subsection, and the duties and au-
thority of the courts of the United States and the 
Attorney General with respect to any forfeiture ac-
tion under this subsection, or with respect to any 
property that may be subject to forfeiture under this 
subsection, shall be governed by the provisions of 
chapter 46 of title 18, United States Code (relating 
to criminal forfeiture), to the same extent as prop-
erty subject to forfeiture under that chapter. 
(c) CIVIL
PENALTIES; ADMINISTRATIVE
SANC-
TIONS.— 
(1) CIVIL PENALTIES.—The Secretary may im-
pose a civil penalty of up to $500,000 for each viola-
tion of a provision of this Act or any regulation, li-
cense, or order issued under this Act. A civil penalty 
under this paragraph may be in addition to, or in 
lieu of, any other liability or penalty which may be 
imposed for such a violation. 
(2) DENIAL OF EXPORT PRIVILEGES.—The Sec-
retary may deny the export privileges of any person, 
including the suspension or revocation of the author-
ity of such person to export or receive United 
States-origin items subject to this Act, for a viola-
tion of a provision of this Act or any regulation, li-
cense, or order issued under this Act. 
(3) EXCLUSION
FROM
PRACTICE.—The Sec-
retary may exclude any person acting as an attor-
ney, accountant, consultant, freight forwarder, or in 
any other representative capacity from participating 
before the Department with respect to a license ap-
plication or any other matter under this Act. 
(d) PAYMENT OF CIVIL PENALTIES.—
(1) PAYMENT AS CONDITION OF FURTHER EX-
PORT PRIVILEGES.—The payment of a civil penalty 
imposed under subsection (c) may be made a condi-
tion for the granting, restoration, or continuing va-
lidity of any export license, permission, or privilege 
granted or to be granted to the person upon whom 
such penalty is imposed. The period for which the
payment of a penalty may be made such a condition 
may not exceed 1 year after the date on which the 
payment is due. 
(2) DEFERRAL OR SUSPENSION.—
(A) IN GENERAL.—The payment of a civil 
penalty imposed under subsection (c) may be 
deferred or suspended in whole or in part for a 
period no longer than any probation period 
(which may exceed 1 year) that may be imposed 
upon the person on whom the penalty is im-
posed.
(B) NO
BAR
TO
COLLECTION
OF
PEN-
ALTY.—A deferral or suspension under sub-
paragraph (A) shall not operate as a bar to the 
collection of the penalty concerned in the event 
that the conditions of the suspension, deferral, 
or probation are not fulfilled. 
(3) TREATMENT OF PAYMENTS.—Any amount 
paid in satisfaction of a civil penalty imposed under 
subsection (c) shall be covered into the Treasury as 
miscellaneous receipts. 
(e) REFUNDS.—
(1) AUTHORITY.—
(A) IN GENERAL.—The Secretary may, in 
the Secretary’s discretion, refund any civil pen-
alty imposed under subsection (c) on the 
ground of a material error of fact or law in im-
position of the penalty. 
(B) LIMITATION.—A civil penalty may not 
be refunded under subparagraph (A) later than 
2 years after payment of the penalty. 
(2) PROHIBITION ON ACTIONS FOR REFUND.—
Notwithstanding section 1346(a) of title 28, United 
States Code, no action for the refund of any civil 
penalty referred to in paragraph (1) may be main-
tained in any court. 
(f) EFFECT OF OTHER CONVICTIONS.— 
(1) DENIAL OF EXPORT PRIVILEGES.—Any per-
son convicted of a violation of— 
(A) a provision of this Act or the Export 
Administration Act of 1979, 
(B) a provision of the International Emer-
gency Economic Powers Act (50 U.S.C. 1701 et 
seq.), 
(C) section 793, 794, or 798 of title 18, 
United States Code, 
(D) section 4(b) of the Internal Security 
Act of 1950 (50 U.S.C. 783(b)), 
(E) section 38 of the Arms Export Control 
Act (22 U.S.C. 2778),
(F) section 16 of the Trading with the 
Enemy Act (50 U.S.C. App. 16), 
(G) any regulation, license, or order issued 
under any provision of law listed in subpara-
graph (A), (B), (C), (D), (E), or (F), 
(H) section 371 or 1001 of title 18, United 
States Code, if in connection with the export of 
controlled items under this Act or any regula-
tion, license, or order issued under the Inter-
national Emergency Economic Powers Act, or 
the export of items controlled under the Arms 
Export Control Act, 
(I) section 175 of title 18, United States 
Code, 
(J) a provision of the Atomic Energy Act 
(42 U.S.C. 201 et seq.), 
(K) section 831 of title 18, United States 
Code, or 
(L) section 2332a of title 18, United 
States Code, 
may, at the discretion of the Secretary, be denied ex-
port privileges under this Act for a period not to ex-
ceed 10 years from the date of the conviction. The 
Secretary may also revoke any export license under
this Act in which such person had an interest at the 
time of the conviction. 
(2) RELATED
PERSONS.—The Secretary may 
exercise the authority under paragraph (1) with re-
spect to any person related through affiliation, own-
ership, control, or position of responsibility to a per-
son convicted of any violation of a law set forth in 
paragraph (1) upon a showing of such relationship 
with the convicted person. The Secretary shall make 
such showing only after providing notice and oppor-
tunity for a hearing. 
(g) STATUTE OF LIMITATIONS.—
(1) IN GENERAL.—Except as provided in para-
graph (2), a proceeding in which a civil penalty or 
other administrative sanction (other than a tem-
porary denial order) is sought under subsection (c) 
may not be instituted more than 5 years after the 
later of the date of the alleged violation or the date 
of discovery of the alleged violation. 
(2) EXCEPTION.—
(A) TOLLING.—In any case in which a 
criminal indictment alleging a violation under 
subsection (a) is returned within the time limits 
prescribed by law for the institution of such ac-
tion, the limitation under paragraph (1) for
bringing a proceeding to impose a civil penalty 
or other administrative sanction under this sec-
tion shall, upon the return of the criminal in-
dictment, be tolled against all persons named as 
a defendant. 
(B) DURATION.—The tolling of the limita-
tion with respect to a defendant under subpara-
graph (A) as a result of a criminal indictment 
shall continue for a period of 6 months from 
the date on which the conviction of the defend-
ant becomes final, the indictment against the 
defendant is dismissed, or the criminal action 
has concluded. 
(h) VIOLATIONS DEFINED BY REGULATION.—Noth-
ing in this section shall limit the authority of the Secretary 
to define by regulation violations under this Act. 
(i) CONSTRUCTION.—Nothing in subsection (c), (d), 
(e), (f), or (g) limits— 
(1) the availability of other administrative or 
judicial remedies with respect to a violation of a pro-
vision of this Act, or any regulation, order, or license 
issued under this Act; 
(2) the authority to compromise and settle ad-
ministrative proceedings brought with respect to any 
such violation; or
(3) the authority to compromise, remit, or miti-
gate seizures and forfeitures pursuant to section 
1(b) of title VI of the Act of June 15, 1917 (22 
U.S.C. 401(b)). 
SEC. 504. MISSILE PROLIFERATION CONTROL VIOLATIONS. 
(a) VIOLATIONS BY UNITED STATES PERSONS.—
(1) SANCTIONS.—
(A) IN GENERAL.—If the President deter-
mines that a United States person knowingly—
(i) exports, transfers, or otherwise en-
gages in the trade of any item on the
MTCR Annex, in violation of the provi-
sions of section 38 (22 U.S.C. 2778) or 
chapter 7 of the Arms Export Control Act, 
title II or III of this Act, or any regula-
tions or orders issued under any such pro-
visions, 
(ii) conspires to or attempts to engage 
in such export, transfer, or trade, or 
(iii) facilitates such export, transfer, 
or trade by any other person, 
then the President shall impose the applicable 
sanctions described in subparagraph (B).
100
(B) SANCTIONS
DESCRIBED.—The sanc-
tions which apply to a United States person 
under subparagraph (A) are the following: 
(i) If the item on the MTCR Annex 
involved in the export, transfer, or trade is 
missile equipment or technology within cat-
egory II of the MTCR Annex, then the 
President shall deny to such United States 
person, for a period of 2 years, licenses for 
the transfer of missile equipment or tech-
nology controlled under this Act. 
(ii) If the item on the MTCR Annex 
involved in the export, transfer, or trade is 
missile equipment or technology within cat-
egory I of the MTCR Annex, then the 
President shall deny to such United States 
person, for a period of not less than 2 
years, all licenses for items the export of 
which is controlled under this Act. 
(2) DISCRETIONARY SANCTIONS.—In the case 
of any determination referred to in paragraph (1), 
the Secretary may pursue any other appropriate 
penalties under section 503. 
(3) WAIVER.—The President may waive the im-
position of sanctions under paragraph (1) on a per-
101
son with respect to an item if the President certifies 
to Congress that—
(A) the item is essential to the national se-
curity of the United States; and 
(B) such person is a sole source supplier of 
the item, the item is not available from any al-
ternative reliable supplier, and the need for the 
item cannot be met in a timely manner by im-
proved manufacturing processes or technological 
developments. 
(b) TRANSFERS OF MISSILE EQUIPMENT OR TECH-
NOLOGY BY FOREIGN PERSONS.—
(1) SANCTIONS.—
(A) IN GENERAL.—Subject to paragraphs 
(3) through (7), if the President determines 
that a foreign person, after the date of enact-
ment of this section, knowingly—
(i) exports, transfers, or otherwise en-
gages in the trade of any MTCR equip-
ment or technology that contributes to the 
design, development, or production of mis-
siles in a country that is not an MTCR ad-
herent and would be, if it were United 
States-origin equipment or technology,
102
subject to the jurisdiction of the United 
States under this Act, 
(ii) conspires to or attempts to engage 
in such export, transfer, or trade, or 
(iii) facilitates such export, transfer, 
or trade by any other person, 
or if the President has made a determination 
with respect to a foreign person under section 
73(a) of the Arms Export Control Act, then the 
President shall impose on that foreign person 
the applicable sanctions under subparagraph 
(B). 
(B) SANCTIONS
DESCRIBED.—The sanc-
tions which apply to a foreign person under 
subparagraph (A) are the following: 
(i) If the item involved in the export, 
transfer, or trade is within category II of 
the MTCR Annex, then the President shall 
deny, for a period of 2 years, licenses for 
the transfer to such foreign person of mis-
sile equipment or technology the export of 
which is controlled under this Act. 
(ii) If the item involved in the export, 
transfer, or trade is within category I of 
the MTCR Annex, then the President shall
103
deny, for a period of not less than 2 years, 
licenses for the transfer to such foreign 
person of items the export of which is con-
trolled under this Act. 
(iii) If, in addition to actions taken 
under clauses (i) and (ii), the President de-
termines that the export, transfer, or trade 
has substantially contributed to the design, 
development, or production of missiles in a 
country that is not an MTCR adherent, 
then the President shall prohibit, for a pe-
riod of not less than 2 years, the importa-
tion into the United States of products 
produced by that foreign person. 
(2) INAPPLICABILITY WITH RESPECT TO MTCR 
ADHERENTS.—Paragraph (1) does not apply with 
respect to—
(A) any export, transfer, or trading activ-
ity that is authorized by the laws of an MTCR 
adherent, if such authorization is not obtained 
by misrepresentation or fraud; or 
(B) any export, transfer, or trade of an 
item to an end user in a country that is an 
MTCR adherent.
104
(3) EFFECT
OF
ENFORCEMENT
ACTIONS
BY 
MTCR
ADHERENTS.—Sanctions set forth in para-
graph (1) may not be imposed under this subsection 
on a person with respect to acts described in such 
paragraph or, if such sanctions are in effect against 
a person on account of such acts, such sanctions 
shall be terminated, if an MTCR adherent is taking 
judicial or other enforcement action against that 
person with respect to such acts, or that person has 
been found by the government of an MTCR adher-
ent to be innocent of wrongdoing with respect to 
such acts.
(4) ADVISORY
OPINIONS.—The Secretary, in 
consultation with the Secretary of State and the 
Secretary of Defense, may, upon the request of any 
person, issue an advisory opinion to that person as 
to whether a proposed activity by that person would 
subject that person to sanctions under this sub-
section. Any person who relies in good faith on such 
an advisory opinion which states that the proposed
activity would not subject a person to such sanc-
tions, and any person who thereafter engages in 
such activity, may not be made subject to such sanc-
tions on account of such activity. 
(5) WAIVER AND REPORT TO CONGRESS.—
105
(A) WAIVER.—In any case other than one 
in which an advisory opinion has been issued 
under paragraph (4) stating that a proposed ac-
tivity would not subject a person to sanctions 
under this subsection, the President may waive 
the application of paragraph (1) to a foreign 
person if the President determines that such 
waiver is essential to the national security of 
the United States. 
(B) REPORT TO CONGRESS.—In the event 
that the President decides to apply the waiver 
described in subparagraph (A), the President 
shall so notify Congress not less than 20 work-
ing days before issuing the waiver. Such notifi-
cation shall include a report fully articulating 
the rationale and circumstances which led the 
President to apply the waiver. 
(6) ADDITIONAL WAIVER.—The President may 
waive the imposition of sanctions under paragraph
(1) on a person with respect to a product or service 
if the President certifies to the Congress that—
(A) the product or service is essential to 
the national security of the United States; and 
(B) such person is a sole source supplier of 
the product or service, the product or service is
106
not available from any alternative reliable sup-
plier, and the need for the product or service 
cannot be met in a timely manner by improved 
manufacturing processes or technological devel-
opments. 
(7) EXCEPTIONS.—The President shall not 
apply the sanction under this subsection prohibiting 
the importation of the products of a foreign per-
son—
(A) in the case of procurement of defense 
articles or defense services—
(i) under existing contracts or sub-
contracts, including the exercise of options 
for production quantities to satisfy require-
ments essential to the national security of 
the United States; 
(ii) if the President determines that 
the person to which the sanctions would be 
applied is a sole source supplier of the de-
fense articles and services, that the defense 
articles or services are essential to the na-
tional security of the United States, and 
that alternative sources are not readily or 
reasonably available; or
107
(iii) if the President determines that 
such articles or services are essential to the 
national security of the United States 
under defense coproduction agreements or 
NATO Programs of Cooperation; 
(B) to products or services provided under 
contracts entered into before the date on which 
the President publishes his intention to impose 
the sanctions; or 
(C) to—
(i) spare parts, 
(ii) component parts, but not finished 
products, essential to United States prod-
ucts or production, 
(iii) routine services and maintenance 
of products, to the extent that alternative 
sources are not readily or reasonably avail-
able, or 
(iv) information and technology essen-
tial to United States products or produc-
tion. 
(c) DEFINITIONS.—In this section: 
(1) MISSILE.—The term ‘‘missile’’ means a cat-
egory I system as defined in the MTCR Annex, and 
any other unmanned delivery system of similar capa-
108
bility, as well as the specially designed production 
facilities for these systems. 
(2) MISSILE TECHNOLOGY CONTROL REGIME; 
MTCR.—The term ‘‘Missile Technology Control Re-
gime’’ or ‘‘MTCR’’ means the policy statement, be-
tween the United States, the United Kingdom, the 
Federal Republic of Germany, France, Italy, Can-
ada, and Japan, announced on April 16, 1987, to re-
strict sensitive missile-relevant transfers based on 
the MTCR Annex, and any amendments thereto. 
(3) MTCR ADHERENT.—The term ‘‘MTCR ad-
herent’’ means a country that participates in the 
MTCR or that, pursuant to an international under-
standing to which the United States is a party, con-
trols MTCR equipment or technology in accordance 
with the criteria and standards set forth in the 
MTCR. 
(4) MTCR ANNEX.—The term ‘‘MTCR Annex’’ 
means the Guidelines and Equipment and Tech-
nology Annex of the MTCR, and any amendments 
thereto. 
(5) MISSILE
EQUIPMENT
OR
TECHNOLOGY; 
MTCR
EQUIPMENT
OR
TECHNOLOGY.—The terms 
‘‘missile equipment or technology’’ and ‘‘MTCR
109
equipment or technology’’ mean those items listed in 
category I or category II of the MTCR Annex. 
(6) FOREIGN PERSON.—The term ‘‘foreign per-
son’’ means any person other than a United States 
person. 
(7) PERSON.—
(A) IN
GENERAL.—The term ‘‘person’’ 
means a natural person as well as a corpora-
tion, business association, partnership, society, 
trust, any other nongovernmental entity, orga-
nization, or group, and any governmental entity
operating as a business enterprise, and any suc-
cessor of any such entity. 
(B) IDENTIFICATION IN CERTAIN CASES.—
In the case of countries where it may be impos-
sible to identify a specific governmental entity 
referred to in subparagraph (A), the term ‘‘per-
son’’ means—
(i) all activities of that government re-
lating to the development or production of 
any missile equipment or technology; and 
(ii) all activities of that government 
affecting the development or production of 
aircraft, electronics, and space systems or 
equipment.
110
(8) OTHERWISE ENGAGED IN THE TRADE OF.—
The term ‘‘otherwise engaged in the trade of’’ 
means, with respect to a particular export or trans-
fer, to be a freight forwarder or designated export-
ing agent, or a consignee or end user of the item to 
be exported or transferred. 
SEC. 505. CHEMICAL AND BIOLOGICAL WEAPONS PRO-
LIFERATION SANCTIONS. 
(a) IMPOSITION OF SANCTIONS.—
(1) DETERMINATION BY THE PRESIDENT.—Ex-
cept as provided in subsection (b)(2), the President 
shall impose both of the sanctions described in sub-
section (c) if the President determines that a foreign 
person, on or after the date of enactment of this sec-
tion, has knowingly and materially contributed—
(A) through the export from the United 
States of any item that is subject to the juris-
diction of the United States under this Act, or 
(B) through the export from any other 
country of any item that would be, if it were a 
United States item, subject to the jurisdiction 
of the United States under this Act, 
to the efforts by any foreign country, project, or en-
tity described in paragraph (2) to use, develop,
111
produce, stockpile, or otherwise acquire chemical or 
biological weapons. 
(2) COUNTRIES, PROJECTS, OR ENTITIES RE-
CEIVING ASSISTANCE.—Paragraph (1) applies in the 
case of—
(A) any foreign country that the President 
determines has, at any time after the date of 
enactment of this Act—
(i) used chemical or biological weap-
ons in violation of international law; 
(ii) used lethal chemical or biological 
weapons against its own nationals; or 
(iii) made substantial preparations to 
engage in the activities described in clause 
(i) or (ii); 
(B) any foreign country whose government 
is determined for purposes of section 310 to be 
a government that has repeatedly provided sup-
port for acts of international terrorism; or 
(C) any other foreign country, project, or 
entity designated by the President for purposes 
of this section. 
(3) PERSONS AGAINST WHICH SANCTIONS ARE 
TO BE IMPOSED.—Sanctions shall be imposed pursu-
ant to paragraph (1) on—
112
(A) the foreign person with respect to 
which the President makes the determination 
described in that paragraph; 
(B) any successor entity to that foreign 
person; 
(C) any foreign person that is a parent or 
subsidiary of that foreign person if that parent 
or subsidiary knowingly assisted in the activities 
which were the basis of that determination; and 
(D) any foreign person that is an affiliate 
of that foreign person if that affiliate knowingly 
assisted in the activities which were the basis of 
that determination and if that affiliate is con-
trolled in fact by that foreign person. 
(b) CONSULTATIONS WITH AND ACTIONS BY FOR-
EIGN GOVERNMENT OF JURISDICTION.—
(1) CONSULTATIONS.—If the President makes 
the determinations described in subsection (a)(1) 
with respect to a foreign person, Congress urges the 
President to initiate consultations immediately with 
the government with primary jurisdiction over that 
foreign person with respect to the imposition of 
sanctions pursuant to this section. 
(2) ACTIONS
BY
GOVERNMENT
OF
JURISDIC-
TION.—In order to pursue such consultations with
114
are, except as provided in paragraph (2) of this sub-
section, the following: 
(A) 
PROCUREMENT
SANCTION.—The 
United States Government shall not procure, or 
enter into any contract for the procurement of, 
any goods or services from any person described 
in subsection (a)(3). 
(B) IMPORT SANCTIONS.—The importation 
into the United States of products produced by 
any person described in subsection (a)(3) shall 
be prohibited.
(2) EXCEPTIONS.—The President shall not be 
required to apply or maintain sanctions under this 
section—
(A) in the case of procurement of defense 
articles or defense services—
(i) under existing contracts or sub-
contracts, including the exercise of options
for production quantities to satisfy United 
States operational military requirements; 
(ii) if the President determines that 
the person or other entity to which the 
sanctions would otherwise be applied is a 
sole source supplier of the defense articles 
or services, that the defense articles or
115
services are essential, and that alternative 
sources are not readily or reasonably avail-
able; or 
(iii) if the President determines that 
such articles or services are essential to the 
national security under defense coproduc-
tion agreements; 
(B) to products or services provided under 
contracts entered into before the date on which 
the President publishes his intention to impose 
sanctions; 
(C) to—
(i) spare parts, 
(ii) component parts, but not finished 
products, essential to United States prod-
ucts or production, or 
(iii) routine servicing and mainte-
nance of products, to the extent that alter-
native sources are not readily or reason-
ably available; 
(D) to information and technology essen-
tial to United States products or production; or 
(E) to medical or other humanitarian 
items.
116
(d) TERMINATION
OF SANCTIONS.—The sanctions 
imposed pursuant to this section shall apply for a period 
of at least 12 months following the imposition of sanctions 
and shall cease to apply thereafter only if the President 
determines and certifies to the Congress that reliable in-
formation indicates that the foreign person with respect 
to which the determination was made under subsection 
(a)(1) has ceased to aid or abet any foreign government, 
project, or entity in its efforts to acquire chemical or bio-
logical weapons capability as described in that subsection. 
(e) WAIVER.—
(1) CRITERION
FOR
WAIVER.—The President 
may waive the application of any sanction imposed 
on any person pursuant to this section, after the end 
of the 12-month period beginning on the date on 
which that sanction was imposed on that person, if 
the President determines and certifies to Congress 
that such waiver is important to the national secu-
rity interests of the United States. 
(2) NOTIFICATION OF AND REPORT TO CON-
GRESS.—If the President decides to exercise the 
waiver authority provided in paragraph (1), the 
President shall so notify the Congress not less than 
20 days before the waiver takes effect. Such notifica-
tion shall include a report fully articulating the ra-
117
tionale and circumstances which led the President to 
exercise the waiver authority. 
(f) DEFINITION OF FOREIGN PERSON.—For the pur-
poses of this section, the term ‘‘foreign person’’ means—
(1) an individual who is not a citizen of the 
United States or an alien admitted for permanent 
residence to the United States; or 
(2) a corporation, partnership, or other entity 
which is created or organized under the laws of a 
foreign country or which has its principal place of 
business outside the United States. 
SEC. 506. ENFORCEMENT. 
(a) GENERAL AUTHORITY AND DESIGNATION.—
(1) POLICY
GUIDANCE
ON
ENFORCEMENT.—
The Secretary, in consultation with the Secretary of 
the Treasury and the heads of other departments 
and agencies that the Secretary considers appro-
priate, shall be responsible for providing policy guid-
ance on the enforcement of this Act. 
(2) GENERAL AUTHORITIES.—
(A) EXERCISE OF AUTHORITY.—To the ex-
tent necessary or appropriate to the enforce-
ment of this Act, officers and employees of the 
Department designated by the Secretary, offi-
cers and employees of the United States Cus-
118
toms Service designated by the Commissioner of 
Customs, and officers and employees of any 
other department or agency designated by the 
head of a department or agency exercising func-
tions under this Act, may exercise the enforce-
ment authority under paragraph (3). 
(B) CUSTOMS SERVICE.—In carrying out 
enforcement authority under paragraph (3), the 
Commissioner of Customs and employees of the 
United States Customs Service designated by 
the Commissioner may make investigations 
within or outside the United States and at
ports of entry into or exit from the United 
States where officers of the United States Cus-
toms Service are authorized by law to carry out 
law enforcement responsibilities. Subject to 
paragraph (3), the United States Customs 
Service is authorized, in the enforcement of this 
Act, to search, detain (after search), and seize 
items at the ports of entry into or exit from 
the United States where officers of the United 
States Customs Service are authorized by law 
to conduct searches, detentions, and seizures, 
and at the places outside the United States 
where the United States Customs Service, pur-
119
suant to agreement or other arrangement with 
other countries, is authorized to perform en-
forcement activities. 
(C) OTHER EMPLOYEES.—In carrying out 
enforcement authority under paragraph (3), the 
Secretary and officers and employees of the De-
partment designated by the Secretary may 
make investigations within the United States, 
and may conduct, outside the United States, 
pre-license and post-shipment verifications of 
controlled items and investigations in the en-
forcement of section 502. The Secretary and of-
ficers and employees of the Department des-
ignated by the Secretary are authorized to 
search, detain (after search), and seize items at 
places within the United States other than 
ports referred to in subparagraph (B). The 
search, detention (after search), or seizure of 
items at the ports and places referred to in sub-
paragraph (B) may be conducted by officers
and employees of the Department only with the 
concurrence of the Commissioner of Customs or 
a person designated by the Commissioner. 
(D) AGREEMENTS AND ARRANGEMENTS.—
The Secretary and the Commissioner of Cus-
120
toms may enter into agreements and arrange-
ments for the enforcement of this Act, including 
foreign investigations and information ex-
change. 
(3) SPECIFIC AUTHORITIES.—
(A) ACTIONS BY ANY DESIGNATED PER-
SONNEL.—Any officer or employee designated 
under paragraph (2), in carrying out the en-
forcement authority under this Act, may do the 
following: 
(i) Make investigations of, obtain in-
formation from, make inspection of any 
books, records, or reports (including any 
writings required to be kept by the Sec-
retary), premises, or property of, and take 
the sworn testimony of, any person. 
(ii) Administer oaths or affirmations, 
and by subpoena require any person to ap-
pear and testify or to appear and produce 
books, records, and other writings, or both. 
In the case of contumacy by, or refusal to 
obey a subpoena issued to, any such per-
son, a district court of the United States, 
on request of the Attorney General and 
after notice to any such person and a hear-
121
ing, shall have jurisdiction to issue an 
order requiring such person to appear and 
give testimony or to appear and produce 
books, records, and other writings, or both. 
Any failure to obey such order of the court 
may be punished by such court as a con-
tempt thereof. The attendance of witnesses 
and the production of documents provided 
for in this clause may be required from 
any State, the District of Columbia, or in 
any territory of the United States at any 
designated place. Witnesses subpoenaed 
under this subsection shall be paid the 
same fees and mileage allowance as paid 
witnesses in the district courts of the 
United States. 
(B) ACTIONS BY OFFICE OF EXPORT EN-
FORCEMENT
AND
CUSTOMS
SERVICE
PER-
SONNEL.—
(i) OFFICE
OF
EXPORT
ENFORCE-
MENT
AND
CUSTOMS
SERVICE
PER-
SONNEL.—Any officer or employee of the 
Office of Export Enforcement of the De-
partment of Commerce (in this Act re-
ferred to as ‘‘OEE’’) who is designated by
122
the Secretary under paragraph (2), and 
any officer or employee of the United 
States Customs Service who is designated 
by the Commissioner of Customs under 
paragraph (2), may do the following in 
carrying out the enforcement authority 
under this Act: 
(I) Execute any warrant or other 
process issued by a court or officer of 
competent jurisdiction with respect to 
the enforcement of this Act. 
(II) Make arrests without war-
rant for any violation of this Act com-
mitted in his or her presence or view, 
or if the officer or employee has prob-
able cause to believe that the person 
to be arrested has committed, is com-
mitting, or is about to commit such a 
violation. 
(III) Carry firearms. 
(ii) OEE PERSONNEL.—Any officer or 
employee of the OEE designated by the 
Secretary under paragraph (2) shall exer-
cise the authority set forth in clause (i)
123
pursuant to guidelines approved by the At-
torney General. 
(C) OTHER ACTIONS BY CUSTOMS SERVICE 
PERSONNEL.—Any officer or employee of the 
United States Customs Service designated by 
the Commissioner of Customs under paragraph 
(2) may do the following in carrying out the en-
forcement authority under this Act: 
(i) Stop, search, and examine a vehi-
cle, vessel, aircraft, or person on which or 
whom the officer or employee has reason-
able cause to suspect there is any item
that has been, is being, or is about to be 
exported from or transited through the 
United States in violation of this Act. 
(ii) Detain and search any package or 
container in which the officer or employee 
has reasonable cause to suspect there is 
any item that has been, is being, or is 
about to be exported from or transited
through the United States in violation of 
this Act. 
(iii) Detain (after search) or seize any 
item, for purposes of securing for trial or 
forfeiture to the United States, on or
124
about such vehicle, vessel, aircraft, or per-
son or in such package or container, if the 
officer or employee has probable cause to 
believe the item has been, is being, or is 
about to be exported from or transited 
through the United States in violation of 
this Act. 
(4) OTHER AUTHORITIES NOT AFFECTED.—The 
authorities conferred by this section are in addition 
to any authorities conferred under other laws. 
(b) FORFEITURE.—
(1) IN GENERAL.—Any tangible items lawfully 
seized under subsection (a) by designated officers or 
employees shall be subject to forfeiture to the United 
States. 
(2) APPLICABLE
LAWS.—Those provisions of 
law relating to—
(A) the seizure, summary and judicial for-
feiture, and condemnation of property for viola-
tions of the customs laws; 
(B) the disposition of such property or the 
proceeds from the sale thereof; 
(C) the remission or mitigation of such for-
feitures; and 
(D) the compromise of claims,
125
shall apply to seizures and forfeitures incurred, or 
alleged to have been incurred, under the provisions 
of this subsection, insofar as applicable and not in-
consistent with this Act. 
(3) FORFEITURES
UNDER
CUSTOMS
LAWS.—
Duties that are imposed upon a customs officer or 
any other person with respect to the seizure and for-
feiture of property under the customs laws may be 
performed with respect to seizures and forfeitures of 
property under this subsection by the Secretary or 
any officer or employee of the Department that may 
be authorized or designated for that purpose by the 
Secretary (or by the Commissioner of Customs or 
any officer or employee of the United States Cus-
toms Service designated by the Commissioner), or, 
upon the request of the Secretary, by any other 
agency that has authority to manage and dispose of 
seized property. 
(c) REFERRAL OF CASES.—All cases involving viola-
tions of this Act shall be referred to the Secretary for pur-
poses of determining civil penalties and administrative 
sanctions under section 503 or to the Attorney General 
for criminal action in accordance with this Act or to both 
the Secretary and the Attorney General. 
(d) UNDERCOVER INVESTIGATION OPERATIONS.—
126
(1) USE OF FUNDS.—With respect to any un-
dercover investigative operation conducted by the 
OEE that is necessary for the detection and pros-
ecution of violations of this Act—
(A) funds made available for export en-
forcement under this Act may be used to pur-
chase property, buildings, and other facilities, 
and to lease equipment, conveyances, and space 
within the United States, without regard to sec-
tions 1341 and 3324 of title 31, United States 
Code, the third undesignated paragraph under 
the heading of ‘‘miscellaneous’’ of the Act of 
March 3, 1877, (40 U.S.C. 34), sections 
3732(a) and 3741 of the Revised Statutes of 
the United States (41 U.S.C. 11(a) and 22), 
subsections (a) and (c) of section 304 of the 
Federal Property and Administrative Services 
Act of 1949 (41 U.S.C. 254 (a) and (c)), and 
section 305 of the Federal Property and Ad-
ministrative Services Act of 1949 (41 U.S.C. 
255); 
(B) funds made available for export en-
forcement under this Act may be used to estab-
lish or to acquire proprietary corporations or 
business entities as part of an undercover oper-
127
ation, and to operate such corporations or busi-
ness entities on a commercial basis, without re-
gard to sections 1341, 3324, and 9102 of title 
31, United States Code; 
(C) funds made available for export en-
forcement under this Act and the proceeds from 
undercover operations may be deposited in 
banks or other financial institutions without re-
gard to the provisions of section 648 of title 18, 
United States Code, and section 3302 of title 
31, United States Code; and
(D) the proceeds from undercover oper-
ations may be used to offset necessary and rea-
sonable expenses incurred in such operations 
without regard to the provisions of section 3302 
of title 31, United States Code, 
if the Director of OEE (or an officer or employee 
designated by the Director) certifies, in writing, that 
the action authorized by subparagraph (A), (B), (C), 
or (D) for which the funds would be used is nec-
essary for the conduct of the undercover operation. 
(2) DISPOSITION OF BUSINESS ENTITIES.—If a 
corporation or business entity established or ac-
quired as part of an undercover operation has a net 
value of more than $250,000 and is to be liquidated,
128
sold, or otherwise disposed of, the Director of OEE 
shall report the circumstances to the Secretary and 
the Comptroller General of the United States as 
much in advance of such disposition as the Director 
of the OEE (or the Director’s designee) determines 
is practicable. The proceeds of the liquidation, sale, 
or other disposition, after obligations incurred by the 
corporation or business enterprise are met, shall be 
deposited in the Treasury of the United States as 
miscellaneous receipts. Any property or equipment 
purchased pursuant to paragraph (1) may be re-
tained for subsequent use in undercover operations 
under this section. When such property or equip-
ment is no longer needed, it shall be considered sur-
plus and disposed of as surplus government prop-
erty. 
(3) DEPOSIT OF PROCEEDS.—As soon as the 
proceeds from an OEE undercover investigative op-
eration with respect to which an action is authorized 
and carried out under this subsection are no longer 
needed for the conduct of such operation, the pro-
ceeds or the balance of the proceeds remaining at 
the time shall be deposited into the Treasury of the 
United States as miscellaneous receipts. 
(4) AUDIT AND REPORT.—
129
(A) AUDIT.—The Director of OEE shall 
conduct a detailed financial audit of each closed 
OEE undercover investigative operation and 
shall submit the results of the audit in writing 
to the Secretary. Not later than 180 days after 
an undercover operation is closed, the Secretary 
shall submit to Congress a report on the results 
of the audit. 
(B) REPORT.—The Secretary shall submit 
annually to Congress a report, which may be in-
cluded in the annual report under section 701, 
specifying the following information: 
(i) The number of undercover inves-
tigative operations pending as of the end of 
the period for which such report is sub-
mitted. 
(ii) The number of undercover inves-
tigative operations commenced in the 1-
year period preceding the period for which 
such report is submitted. 
(iii) The number of undercover inves-
tigative operations closed in the 1-year pe-
riod preceding the period for which such 
report is submitted and, with respect to
each such closed undercover operation, the
130
results obtained and any civil claims made 
with respect to the operation. 
(5) DEFINITIONS.—For purposes of paragraph 
(4)—
(A) the term ‘‘closed’’, with respect to an 
undercover investigative operation, refers to the 
earliest point in time at which all criminal pro-
ceedings (other than appeals) pursuant to the 
investigative operation are concluded, or covert 
activities pursuant to such operation are con-
cluded, whichever occurs later; and 
(B) the terms ‘‘undercover investigative 
operation’’ and ‘‘undercover operation’’ mean 
any undercover investigative operation con-
ducted by the OEE—
(i) in which the gross receipts (exclud-
ing interest earned) exceed $25,000, or ex-
penditures (other than expenditures for 
salaries of employees) exceed $75,000, and 
(ii) which is exempt from section 3302 
or 9102 of title 31, United States Code, 
except that clauses (i) and (ii) shall not 
apply with respect to the report to Con-
gress required by paragraph (4)(B). 
(e) WIRETAPS.—
131
(1) AUTHORITY.—Interceptions of communica-
tions in accordance with section 2516 of title 18, 
United States Code, are authorized to further the 
enforcement of this Act. 
(2) 
CONFORMING
AMENDMENT.—Section 
2516(1) of title 18, United States Code, is amended 
by adding at the end the following: 
‘‘(q)(i) any violation of, or conspiracy to 
violate, the Export Administration Act of 2003 
or the Export Administration Act of 1979.’’. 
(f) POST-SHIPMENT VERIFICATION.—The Secretary 
shall target post-shipment verifications to exports involv-
ing the greatest risk to national security. 
(g) 
REFUSAL
TO
ALLOW
POST-SHIPMENT 
VERIFICATION.—
(1) IN
GENERAL.—If an end-user refuses to 
allow post-shipment verification of a controlled item, 
the Secretary shall deny a license for the export of 
any controlled item to such end-user until such post-
shipment verification occurs. 
(2) RELATED
PERSONS.—The Secretary may 
exercise the authority under paragraph (1) with re-
spect to any person related through affiliation, own-
ership, control, or position of responsibility, to any
132
end-user refusing to allow post-shipment verification 
of a controlled item. 
(3) REFUSAL BY COUNTRY.—If the country in 
which the end-user is located refuses to allow post-
shipment verification of a controlled item, the Sec-
retary may deny a license for the export of that item 
or any substantially identical or directly competitive
item or class of items to all end-users in that coun-
try until such post-shipment verification is allowed. 
(h) FREIGHT FORWARDERS BEST PRACTICES PRO-
GRAM AUTHORIZATION.—There is authorized to be appro-
priated for the Department of Commerce $3,500,000 and 
such sums as may be necessary to hire 20 additional em-
ployees to assist United States freight forwarders and 
other interested parties in developing and implementing, 
on a voluntary basis, a ‘‘best practices’’ program to ensure 
that exports of controlled items are undertaken in compli-
ance with this Act. 
(i) END-USE VERIFICATION AUTHORIZATION.—
(1) IN GENERAL.—There is authorized to be 
appropriated for the Department of Commerce 
$4,500,000 and such sums as may be necessary to 
hire 10 additional overseas investigators to be posted 
in the People’s Republic of China, the Russian Fed-
eration, the Hong Kong Special Administrative Re-
133
gion, the Republic of India, Singapore, Egypt, and 
Taiwan, or any other place the Secretary deems ap-
propriate, for the purpose of verifying the end use 
of high-risk, dual-use technology. 
(2) REPORT.—Not later than 2 years after the 
date of enactment of this Act and annually there-
after, the Department shall, in its annual report to 
Congress on export controls, include a report on the 
effectiveness of the end-use verification activities au-
thorized under subsection (a). The report shall in-
clude the following information: 
(A) The activities of the overseas investiga-
tors of the Department. 
(B) The types of goods and technologies 
that were subject to end-use verification. 
(C) The ability of the Department’s inves-
tigators to detect the illegal transfer of high 
risk, dual-use goods and technologies. 
(3) ENHANCEMENTS.—In addition to the au-
thorization provided in paragraph (1), there is au-
thorized to be appropriated for the Department of 
Commerce $5,000,000 to enhance its program for 
verifying the end use of items subject to controls 
under this Act.
134
(j) ENHANCED COOPERATION WITH UNITED STATES 
CUSTOMS SERVICE.—Consistent with the purposes of this 
Act, the Secretary is authorized to undertake, in coopera-
tion with the United States Customs Service, such meas-
ures as may be necessary or required to enhance the abil-
ity of the United States to detect unlawful exports and 
to enforce violations of this Act. 
(k) REFERENCE TO ENFORCEMENT.—For purposes 
of this section, a reference to the enforcement of this Act 
or to a violation of this Act includes a reference to the 
enforcement or a violation of any regulation, license, or 
order issued under this Act. 
(l) AUTHORIZATION FOR EXPORT LICENSING AND 
ENFORCEMENT COMPUTER SYSTEM.—There is author-
ized to be appropriated for the Department $5,000,000 
and such other sums as may be necessary for planning, 
design, and procurement of a computer system to replace 
the Department’s primary export licensing and computer 
enforcement system. 
(m) AUTHORIZATION FOR BUREAU OF EXPORT AD-
MINISTRATION.—The Secretary may authorize, without 
fiscal year limitation, the expenditure of funds transferred 
to, paid to, received by, or made available to the Bureau 
of Export Administration as a reimbursement in accord-
ance with section 9703 of title 31, United States Code
135
(as added by Public Law 102–393). The Secretary may 
also authorize, without fiscal year limitation, the expendi-
ture of funds transferred to, paid to, received by, or made 
available to the Bureau of Export Administration as a re-
imbursement from the Department of Justice Assets For-
feiture Fund in accordance with section 524 of title 28, 
United States Code. Such funds shall be deposited in an 
account and shall remain available until expended. 
(n) AMENDMENTS TO TITLE 31.—
(1) Section 9703(a) of title 31, United States 
Code (as added by Public Law 102–393) is amended 
by striking ‘‘or the United States Coast Guard’’ and 
inserting ‘‘, the United States Coast Guard, or the 
Bureau of Export Administration of the Department 
of Commerce’’. 
(2) Section 9703(a)(2)(B)(i) of title 31, United 
States Code is amended (as added by Public Law 
102–393)— 
(A) by striking ‘‘or’’ at the end of sub-
clause (I); 
(B) by inserting ‘‘or’’ at the end of sub-
clause (II); and 
(C) by inserting at the end, the following 
new subclause:
136
‘‘(III) a violation of the Export 
Administration Act of 1979, the Ex-
port Administration Act of 2003, or 
any regulation, license, or order issued 
under those Acts;’’. 
(3) Section 9703(p)(1) of title 31, United 
States Code (as added by Public Law 102–393) is 
amended by adding at the end the following: ‘‘In ad-
dition, for purposes of this section, the Bureau of 
Export Administration of the Department of Com-
merce shall be considered to be a Department of the 
Treasury law enforcement organization.’’. 
(o) AUTHORIZATION FOR LICENSE REVIEW OFFI-
CERS.—
(1) IN GENERAL.—There is authorized to be 
appropriated to the Department of Commerce 
$2,000,000 to hire additional license review officers. 
(2) TRAINING.—There is authorized to be ap-
propriated 
to 
the 
Department 
of 
Commerce 
$2,000,000 to conduct professional training of li-
cense review officers, auditors, and investigators 
conducting post-shipment verification checks. These 
funds shall be used to—
137
(A) train and certify, through a formal 
program, new employees entering these posi-
tions for the first time; and 
(B) the ongoing professional training of ex-
perienced employees on an as needed basis. 
(p) AUTHORIZATION.—
(1) IN GENERAL.—There are authorized to be 
appropriated to the Department of Commerce to 
carry out the purposes of this Act—
(A) $72,000,000 for the fiscal year 2002, 
of which no less than $27,701,000 shall be used 
for compliance and enforcement activities; 
(B) $73,000,000 for the fiscal year 2003, 
of which no less than $28,312,000 shall be used 
for compliance and enforcement activities; 
(C) $74,000,000 for the fiscal year 2004, 
of which no less than $28,939,000 shall be used 
for compliance and enforcement activities; 
(D) $76,000,000 for the fiscal year 2005, 
of which no less than $29,582,000 shall be used 
for compliance and enforcement activities; and 
(E) such additional amounts, for each such 
fiscal year, as may be necessary for increases in 
salary, pay, retirement, other employee benefits
138
authorized by law, and other nondiscretionary 
costs. 
(2) LIMITATION.—The authority granted by 
this Act shall terminate on September 30, 2004, un-
less the President carries out the following duties: 
(A) Provides to Congress a detailed report 
on—
(i) the implementation and operation 
of this Act; and 
(ii) the operation of United States ex-
port controls in general. 
(B)(i) Provides to Congress legislative re-
form proposals in connection with the report 
described in subparagraph (A); or 
(ii) certifies to Congress that no legislative 
reforms are necessary in connection with such 
report. 
SEC. 507. ADMINISTRATIVE PROCEDURE. 
(a) EXEMPTIONS FROM ADMINISTRATIVE PROCE-
DURE.—Except as provided in this section, the functions 
exercised under this Act are excluded from the operation 
of sections 551, 553 through 559, and 701 through 706 
of title 5, United States Code. 
(b) PROCEDURES RELATING TO CIVIL PENALTIES 
AND SANCTIONS.—
139
(1) ADMINISTRATIVE
PROCEDURES.—Any ad-
ministrative sanction imposed under section 503 
may be imposed only after notice and opportunity 
for an agency hearing on the record in accordance 
with sections 554 through 557 of title 5, United 
States Code. The imposition of any such administra-
tive sanction shall be subject to judicial review in ac-
cordance with sections 701 through 706 of title 5, 
United States Code, except that the review shall be 
initiated in the United States Court of Appeals for 
the District of Columbia Circuit, which shall have 
jurisdiction of the review. 
(2) AVAILABILITY OF CHARGING LETTER.—Any 
charging letter or other document initiating adminis-
trative proceedings for the imposition of sanctions 
for violations of the regulations issued under section 
502 shall be made available for public inspection and 
copying. 
(c) COLLECTION.—If any person fails to pay a civil 
penalty imposed under section 503, the Secretary may ask 
the Attorney General to commence a civil action in an ap-
propriate district court of the United States to recover the 
amount imposed (plus interest at currently prevailing 
rates from the date of the final order). No such action 
may be commenced more than 5 years after the order im-
140
posing the civil penalty becomes final. In such an action, 
the validity, amount, and appropriateness of such penalty 
shall not be subject to review. 
(d) IMPOSITION OF TEMPORARY DENIAL ORDERS.—
(1) GROUNDS FOR IMPOSITION.—In any case in 
which there is reasonable cause to believe that a per-
son is engaged in or is about to engage in any act 
or practice which constitutes or would constitute a 
violation of this Act, or any regulation, order, or li-
cense issued under this Act, including any diversion 
of goods or technology from an authorized end use 
or end user, and in any case in which a criminal in-
dictment has been returned against a person alleging 
a violation of this Act or any of the statutes listed 
in section 503, the Secretary may, without a hear-
ing, issue an order temporarily denying that person’s 
United States export privileges (hereafter in this 
subsection referred to as a ‘‘temporary denial 
order’’). A temporary denial order shall be effective 
for such period (not in excess of 180 days) as the 
Secretary specifies in the order, but may be renewed 
by the Secretary, following notice and an oppor-
tunity for a hearing, for additional periods of not 
more than 180 days each.
141
(2) ADMINISTRATIVE APPEALS.—The person or 
persons subject to the issuance or renewal of a tem-
porary denial order may appeal the issuance or re-
newal of the temporary denial order, supported by 
briefs and other material, to an administrative law 
judge who shall, within 15 working days after the 
appeal is filed, issue a decision affirming, modifying, 
or vacating the temporary denial order. The tem-
porary denial order shall be affirmed if it is shown 
that—
(A) there is reasonable cause to believe 
that the person subject to the order is engaged 
in or is about to engage in any act or practice 
that constitutes or would constitute a violation 
of this Act, or any regulation, order, or license 
issued under this Act; or 
(B) a criminal indictment has been re-
turned against the person subject to the order 
alleging a violation of this Act or any of the 
statutes listed in section 503. 
The decision of the administrative law judge shall be 
final unless, within 10 working days after the date 
of the administrative law judge’s decision, an appeal 
is filed with the Secretary. On appeal, the Secretary 
shall either affirm, modify, reverse, or vacate the de-
142
cision of the administrative law judge by written 
order within 10 working days after receiving the ap-
peal. The written order of the Secretary shall be 
final and is not subject to judicial review, except as 
provided in paragraph (3). The materials submitted 
to the administrative law judge and the Secretary 
shall constitute the administrative record for pur-
poses of review by the court. 
(3) COURT
APPEALS.—An order of the Sec-
retary affirming, in whole or in part, the issuance or
renewal of a temporary denial order may, within 15 
days after the order is issued, be appealed by a per-
son subject to the order to the United States Court 
of Appeals for the District of Columbia Circuit, 
which shall have jurisdiction of the appeal. The 
court may review only those issues necessary to de-
termine whether the issuance of the temporary de-
nial order was based on reasonable cause to believe 
that the person subject to the order was engaged 
in or was about to engage in any act or practice 
that constitutes or would constitute a violation of 
this title, or any regulation, order, or license issued 
under this Act, or whether a criminal indictment has 
been returned against the person subject to the 
order alleging a violation of this Act or of any of
143
the statutes listed in section 503. The court shall 
vacate the Secretary’s order if the court finds that 
the Secretary’s order is arbitrary, capricious, an 
abuse of discretion, or otherwise not in accordance 
with law. 
(e) LIMITATIONS ON REVIEW OF CLASSIFIED INFOR-
MATION.—Any classified information that is included in 
the administrative record that is subject to review pursu-
ant to subsection (b)(1) or (d)(3) may be reviewed by the 
court only on an ex parte basis and in camera. 
TITLE VI—EXPORT CONTROL 
AUTHORITY AND REGULATIONS 
SEC. 601. EXPORT CONTROL AUTHORITY AND REGULA-
TIONS. 
(a) EXPORT CONTROL AUTHORITY.—
(1) IN GENERAL.—Unless otherwise reserved to 
the President or a department (other than the De-
partment) or agency of the United States, all power, 
authority, and discretion conferred by this Act shall 
be exercised by the Secretary. 
(2) DELEGATION OF FUNCTIONS OF THE SEC-
RETARY.—The Secretary may delegate any function 
under this Act, unless otherwise provided, to the 
Under Secretary of Commerce for Export Adminis-
tration or to any other officer of the Department.
144
(b) UNDER SECRETARY OF COMMERCE; ASSISTANT 
SECRETARIES.—
(1) UNDER SECRETARY OF COMMERCE.—There 
shall be within the Department an Under Secretary 
of Commerce for Export Administration (in this sec-
tion referred to as the ‘‘Under Secretary’’) who shall 
be appointed by the President, by and with the ad-
vice and consent of the Senate. The Under Secretary
shall carry out all functions of the Secretary under 
this Act and other provisions of law relating to na-
tional security, as the Secretary may delegate. 
(2) ADDITIONAL ASSISTANT SECRETARIES.—In 
addition to the number of Assistant Secretaries oth-
erwise authorized for the Department of Commerce, 
there shall be within the Department of Commerce 
the following Assistant Secretaries of Commerce: 
(A) An Assistant Secretary for Export Ad-
ministration who shall be appointed by the 
President, by and with the advice and consent 
of the Senate, and who shall assist the Sec-
retary and the Under Secretary in carrying out 
functions relating to export listing and licens-
ing. 
(B) An Assistant Secretary for Export En-
forcement who shall be appointed by the Presi-
145
dent, by and with the advice and consent of the 
Senate, and who shall assist the Secretary and 
the Under Secretary in carrying out functions 
relating to export enforcement. 
(c) ISSUANCE OF REGULATIONS.—
(1) IN GENERAL.—The President and the Sec-
retary may issue such regulations as are necessary 
to carry out this Act. Any such regulations the pur-
pose of which is to carry out title II or title III may 
be issued only after the regulations are submitted 
for review to such departments or agencies as the 
President considers appropriate. The Secretary shall 
consult with the appropriate export control advisory 
committee appointed under section 105(a) in formu-
lating regulations under this title. The second sen-
tence of this subsection does not require the concur-
rence or approval of any official, department, or 
agency to which such regulations are submitted. 
(2) AMENDMENTS
TO
REGULATIONS.—If the 
Secretary proposes to amend regulations issued 
under this Act, the Secretary shall report to the 
Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on International 
Relations of the House of Representatives on the in-
tent and rationale of such amendments. Such report
146
shall evaluate the cost and burden to the United 
States exporters of the proposed amendments in re-
lation to any enhancement of licensing objectives. 
The Secretary shall consult with the appropriate ex-
port control advisory committees appointed under 
section 105(a) in amending regulations issued under 
this Act. 
SEC. 602. CONFIDENTIALITY OF INFORMATION. 
(a) EXEMPTIONS FROM DISCLOSURE.—
(1) INFORMATION
OBTAINED
ON
OR
BEFORE 
JUNE 30, 1980.—Except as otherwise provided by the 
third sentence of section 502(c)(2) and by section 
507(b)(2), information obtained under the Export 
Administration Act of 1979, or any predecessor stat-
ute, on or before June 30, 1980, which is deemed 
confidential, including Shipper’s Export Declara-
tions, or with respect to which a request for con-
fidential treatment is made by the person furnishing 
such information, shall not be subject to disclosure 
under section 552 of title 5, United States Code, 
and such information shall not be published or dis-
closed, unless the Secretary determines that the 
withholding thereof is contrary to the national inter-
est.
147
(2) INFORMATION OBTAINED AFTER JUNE 30, 
1980.—Except as otherwise provided by the third 
sentence of section 502(c)(2) and by section 
507(b)(2), information obtained under this Act, 
under the Export Administration Act of 1979 after 
June 30, 1980, or under the Export Administration 
regulations as maintained and amended under the 
authority of the International Emergency Economic 
Powers Act (50 U.S.C. 1706), may be withheld from 
disclosure only to the extent permitted by statute,
except that information submitted, obtained, or con-
sidered in connection with an application for an ex-
port license or other export authorization (or record-
keeping or reporting requirement) under the Export 
Administration Act of 1979, under this Act, or 
under the Export Administration regulations as 
maintained and amended under the authority of the 
International Emergency Economic Powers Act (50 
U.S.C. 1706), including—
(A) the export license or other export au-
thorization itself, 
(B) classification requests described in sec-
tion 401(h), 
(C) information or evidence obtained in the 
course of any investigation,
148
(D) information obtained or furnished 
under title V in connection with any inter-
national agreement, treaty, or other obligation, 
and 
(E) information obtained in making the 
determinations set forth in section 211 of this 
Act, 
and information obtained in any investigation of an 
alleged violation of section 502 of this Act except for 
information required to be disclosed by section 
502(c)(2) or 507(b)(2) of this Act, shall be withheld 
from public disclosure and shall not be subject to 
disclosure under section 552 of title 5, United States 
Code, unless the release of such information is deter-
mined by the Secretary to be in the national inter-
est. 
(b) INFORMATION TO CONGRESS AND GAO.—
(1) IN GENERAL.—Nothing in this title shall be 
construed as authorizing the withholding of informa-
tion from Congress or from the General Accounting 
Office. 
(2) AVAILABILITY TO THE CONGRESS.—
(A) IN
GENERAL.—Any information ob-
tained at any time under this title or under any 
predecessor Act regarding the control of ex-
149
ports, including any report or license applica-
tion required under this title, shall be made 
available to any committee or subcommittee of 
Congress of appropriate jurisdiction upon the 
request of the chairman or ranking minority 
member of such committee or subcommittee. 
(B) PROHIBITION
ON
FURTHER
DISCLO-
SURE.—No committee, subcommittee, or Mem-
ber of Congress shall disclose any information 
obtained under this Act or any predecessor Act
regarding the control of exports which is sub-
mitted on a confidential basis to the Congress 
under subparagraph (A) unless the full com-
mittee to which the information is made avail-
able determines that the withholding of the in-
formation is contrary to the national interest. 
(3) AVAILABILITY TO THE GAO.—
(A) IN
GENERAL.—Notwithstanding sub-
section (a), information described in paragraph 
(2) shall, consistent with the protection of intel-
ligence, counterintelligence, and law enforce-
ment sources, methods, and activities, as deter-
mined by the agency that originally obtained 
the information, and consistent with the provi-
sions of section 716 of title 31, United States
150
Code, be made available only by the agency, 
upon request, to the Comptroller General of the 
United States or to any officer or employee of 
the General Accounting Office authorized by 
the Comptroller General to have access to such 
information. 
(B) PROHIBITION
ON
FURTHER
DISCLO-
SURES.—No officer or employee of the General 
Accounting Office shall disclose, except to Con-
gress in accordance with this paragraph, any 
such information which is submitted on a con-
fidential basis and from which any individual 
can be identified. 
(c) 
INFORMATION
EXCHANGE.—Notwithstanding 
subsection (a), the Secretary and the Commissioner of 
Customs shall exchange licensing and enforcement infor-
mation with each other as necessary to facilitate enforce-
ment efforts and effective license decisions. 
(d) PENALTIES FOR DISCLOSURE OF CONFIDENTIAL 
INFORMATION.—
(1) DISCLOSURE PROHIBITED.—No officer or 
employee of the United States, or any department or 
agency thereof, may publish, divulge, disclose, or 
make known in any manner or to any extent not au-
thorized by law any information that—
151
(A) the officer or employee obtains in the 
course of his or her employment or official du-
ties or by reason of any examination or inves-
tigation made by, or report or record made to 
or filed with, such department or agency, or of-
ficer or employee thereof; and 
(B) is exempt from disclosure under this 
section. 
(2) CRIMINAL PENALTIES.—Any such officer or 
employee who knowingly violates paragraph (1) shall 
be fined not more than $50,000, imprisoned not
more than 1 year, or both, for each violation of 
paragraph (1). Any such officer or employee may 
also be removed from office or employment. 
(3) CIVIL PENALTIES; ADMINISTRATIVE SANC-
TIONS.—The Secretary may impose a civil penalty of 
not more than $5,000 for each violation of para-
graph (1). Any officer or employee who commits 
such violation may also be removed from office or 
employment for the violation of paragraph (1). Sec-
tions 503 (e), (g), (h), and (i) and 507 (a), (b), and 
(c) shall apply to violations described in this para-
graph.
152
TITLE VII—MISCELLANEOUS 
PROVISIONS 
SEC. 701. ANNUAL REPORT. 
(a) ANNUAL REPORT.—Not later than February 1 of 
each year, the Secretary shall submit to Congress a report 
on the administration of this Act during the fiscal year 
ending September 30 of the preceding calendar year. All 
Federal agencies shall cooperate fully with the Secretary 
in providing information for each such report. 
(b) REPORT ELEMENTS.—Each such report shall in-
clude in detail—
(1) a description of the implementation of the 
export control policies established by this Act, in-
cluding any delegations of authority by the President 
and any other changes in the exercise of delegated 
authority; 
(2) a description of the changes to and the 
year-end status of country tiering and the Control 
List; 
(3) a description of the petitions filed and the 
determinations made with respect to foreign avail-
ability and mass-market status, the set-asides of for-
eign availability and mass-market status determina-
tions, and negotiations to eliminate foreign avail-
ability;
153
(4) a description of any enhanced control im-
posed on an item pursuant to section 201(d); 
(5) a description of the regulations issued under 
this Act; 
(6) a description of organizational and proce-
dural changes undertaken in furtherance of this Act; 
(7) a description of the enforcement activities, 
violations, and sanctions imposed under this Act; 
(8) a statistical summary of all applications and 
notifications, including—
(A) the number of applications and notifi-
cations pending review at the beginning of the 
fiscal year; 
(B) the number of notifications returned 
and subject to full license procedure; 
(C) the number of notifications with no ac-
tion required; 
(D) the number of applications that were 
approved, denied, or withdrawn, and the num-
ber of applications where final action was 
taken; and 
(E) the number of applications and notifi-
cations pending review at the end of the fiscal 
year;
155
(c) FEDERAL REGISTER PUBLICATION REQUIRE-
MENTS.—Whenever information under this Act is required 
to be published in the Federal Register, such information 
shall, in addition, be posted on the Department of Com-
merce or other appropriate government website. 
SEC. 702. TECHNICAL AND CONFORMING AMENDMENTS. 
(a) REPEAL.—The Export Administration Act of 
1979 (50 U.S.C. App. 2401 et seq.) is repealed. 
(b) ENERGY POLICY AND CONSERVATION ACT.—
(1) Section 103 of the Energy Policy and Con-
servation Act (42 U.S.C. 6212) is repealed. 
(2) Section 251(d) of the Energy Policy and 
Conservation Act (42 U.S.C. 6271(d)) is repealed. 
(c) ALASKA NATURAL GAS TRANSPORTATION ACT.—
Section 12 of the Alaska Natural Gas Transportation Act 
of 1976 (15 U.S.C. 719j) is repealed. 
(d) MINERAL LEASING ACT.—Section 28(u) of the 
Mineral Leasing Act (30 U.S.C. 185(u)) is repealed. 
(e) EXPORTS OF ALASKAN NORTH SLOPE OIL.—Sec-
tion 28(s) of the Mineral Leasing Act (30 U.S.C. 185(s)) 
is repealed. 
(f) DISPOSITION OF CERTAIN NAVAL PETROLEUM 
RESERVE PRODUCTS.—Section 7430(e) of title 10, United 
States Code, is repealed.
156
(g) OUTER CONTINENTAL SHELF LANDS ACT.—Sec-
tion 28 of the Outer Continental Shelf Lands Act (43 
U.S.C. 1354) is repealed. 
(h) ARMS EXPORT CONTROL ACT.—
(1) Section 38 of the Arms Export Control Act 
(22 U.S.C. 2778) is amended—
(A) in subsection (e)—
(i) in the first sentence, by striking 
‘‘subsections (c)’’ and all that follows 
through ‘‘11(c)(2)(B) of such Act’’ and in-
serting ‘‘subsections (b), (c), (d) and (e) of 
section 503 of the Export Administration 
Act of 2003, by subsections (a) and (b) of 
section 506 of such Act, and by section 
602 of such Act, subject to the same terms 
and conditions as are applicable to such 
powers under that Act, except that section 
section 507(b) of that Act’’; and 
(ii) in the third sentence, by striking 
‘‘11(c) of the Export Administration Act of 
1979’’ and inserting ‘‘503(c) of the Export 
Administration Act of 2003’’; and 
(B) in subsection (g)(1)(A)(ii), by inserting 
‘‘or section 503 of the Export Administration 
Act of 2003’’ after ‘‘1979’’.
157
(2) Section 39A(c) of the Arms Export Control 
Act (22 U.S.C. 2779a(c)) is amended—
(A) by striking ‘‘subsections (c),’’ and all 
that follows through ‘‘11(c)(2)(B) of such Act’’ 
and inserting ‘‘subsections (c), (d), and (e) of 
section 503, section 507(c), and subsections (a) 
and (b) of section 506, of the Export Adminis-
tration Act of 2003, subject to the same terms 
and conditions as are applicable to such powers 
under that Act, except that section 507(b) of 
that Act’’; and 
(B) by striking ‘‘11(c)’’ and inserting 
‘‘503(c)’’. 
(3) Section 40(k) of the Arms Export Control 
Act (22 U.S.C. 2780(k)) is amended—
(A) by striking ‘‘11(c),’’ and all that fol-
lows through ‘‘11(c)(2)(B) of such Act’’ and in-
serting ‘‘503(b), 503(c), 503(e), 506(a), and 
506(b) of the Export Administration Act of 
2003 (subject to the same terms and conditions 
as are applicable to such powers under that 
Act), except that section 507(b) of that Act’’; 
and 
(B) by striking ‘‘11(c)’’ and inserting 
‘‘503(c)’’.
158
(i) OTHER PROVISIONS OF LAW.—
(1) Section 5(b)(4) of the Trading with the 
Enemy Act (50 U.S.C. App. 5(b)(4)) is amended by 
striking ‘‘section 5 of the Export Administration Act 
of 1979, or under section 6 of that Act to the extent 
that such controls promote the nonproliferation or 
antiterrorism policies of the United States’’ and in-
serting ‘‘titles II and III of the Export Administra-
tion Act of 2003’’. 
(2) Section 502B(a)(2) of the Foreign Assist-
ance Act of 1961 (22 U.S.C. 2304(a)(2)) is amend-
ed in the second sentence—
(A) by striking ‘‘Export Administration 
Act of 1979’’ the first place it appears and in-
serting ‘‘Export Administration Act of 2003’’; 
and 
(B) by striking ‘‘Act of 1979)’’ and insert-
ing ‘‘Act of 2003)’’. 
(3) Section 140(a) of the Foreign Relations Au-
thorization Act, Fiscal Years 1988 and 1989 (22 
U.S.C. 2656f(a)) is amended—
(A) in paragraph (1)(B), by inserting ‘‘or 
section 310 of the Export Administration Act of 
2003’’ after ‘‘Act of 1979’’; and