Source: https://www.federalregister.gov/documents/2014/06/17/2014-14157/update-of-short-supply-export-controls-unprocessed-western-red-cedar-crude-oil-and-petroleum
Timestamp: 2018-04-27 07:20:53
Document Index: 216968940

Matched Legal Cases: ['art 754', 'art 754', 'art 754', 'art 754', 'art 754', 'art 754', '§\u2009754', 'art 754', '§\u2009742', 'art 754', 'art 754', '§\u2009754', '§\u2009754', 'art 754', '§\u2009754', 'art 754', '§\u2009754', '§\u2009754', '§\u2009754', 'art 754', '§\u2009754', '§\u2009754', '§\u2009754', 'art 754', 'art 754', '§\u2009742', 'arts 742', 'arts 730', 'art 754', 'art 754', '§\u2009754', 'art.\n5', 'art 754', 'art 754', '§\u2009754', 'art 774', '§\u2009754', '§\u2009754', 'art 754']

Federal Register :: Update of Short Supply Export Controls: Unprocessed Western Red Cedar, Crude Oil, and Petroleum Products
A Rule by the Industry and Security Bureau on 06/17/2014
Effective date is June 17, 2014.
0694-AG06
BIS-2014-0020
Section 742.1(b)(1) CCL Based Controls; Reasons for Control Listed on the CCL not Covered by This Part; Short Supply
Section 754.1 Introduction
Section 754.4 Unprocessed Western Red Cedar
https://www.federalregister.gov/d/2014-14157 https://www.federalregister.gov/d/2014-14157
Gerard Horner, Director, Office of Technology Evaluation, Bureau of Industry and Security, Department of Commerce, Phone: (202) 482-2078 or by email at Gerard.Horner@bis.doc.gov.
The “Harmonized System Classification” is a six-digit standardized numerical method of classifying traded products. Harmonized System numbers are used by customs authorities around the world to identify products for the application of duties and taxes. The United States has adopted the Harmonized System as the basis of both its export classification system, referred to as Schedule B, and its import classification system, called the Harmonized Tariff Schedule (HTS). The first six digits of the commodity numbers for a product listed on the HTS and the Schedule B are identical to one another with respect to descriptions and codes.
Schedule B numbers are administered and used by the U.S. Commerce Department, Census Bureau, Foreign Trade Division to collect and publish U.S. export statistics. Schedule B numbers are required to be reported in the Automated Export System (AES) for all export transactions originating in the United States. There is a Schedule B commodity number for every physical product, from paperclips to airplanes, that are exported from the United States to foreign countries. According to the introduction to the Schedule B, which provides for definitions of commonly-used terms and a guide to interpreting and using the Schedule B, the term “headings” refers to the article descriptions appearing in Schedule B at the four-digit level; the term “subheading” refers to any article description indented thereunder. A reference to “headings” also encompasses the subheadings indented thereunder. The Schedule B 2014 may be found at http://www.census.gov/​foreign-trade/​schedules/​b/​2014/​index.html. There is no direct correlation between Schedule B commodity numbers and the Commerce Control List Export Control Classification Numbers (ECCNs).
The Bureau of Industry and Security (BIS) regulates the export of unprocessed western red cedar, crude oil, and petroleum products (that were produced or derived from the Naval Petroleum Reserves (NPR) or became available for export as a result of an exchange of any NPR-produced or derived commodities) under the Export Administration Regulations' (EAR) short supply controls. A license is required for exports of these commodities to all destinations, including Canada.
For the convenience of exporters, BIS created Supplement No. 1 and Supplement No. 2 to part 754 in the EAR to illustrate the Schedule B commodity numbers that could apply to crude oil, petroleum products, and unprocessed western red cedar controlled under the EAR. The Schedule B numbers in Supplement No. 1 to part 754 (crude oil and petroleum products) were based on the 1994 version of the Schedule B of commodity classifications. The Schedule B numbers in Supplement No. 2 to part 754 (unprocessed western red cedar) were based on versions of the Schedule B from the 1980's. The current version applicable to all of these commodities is Schedule B 2014.
This rule updates the lists in the two supplements to remove obsolete descriptions and Schedule B commodity numbers and add relevant descriptions and Schedule B commodity numbers for these short supply commodities. This rule also clarifies the description of petroleum products in other sections of the EAR to ensure those references are current.
Supplement No. 1 to part 754 of the EAR contains a total of 43 Schedule B numbers, two for crude oil and 41 for petroleum products. Significant modifications to Schedule B numbers have taken place over the years. After twenty years, all Schedule B numbers, except one (2804.29.0010 for “Helium”) are now either obsolete or have undergone modifications to the commodity descriptions in the Schedule Start Printed Page 34409B. Specifically, the two numbers for crude oil and 22 numbers for petroleum products are obsolete, and the modifications have been made to the commodity descriptions in 18 numbers for petroleum products. This rule updates the Schedule B numbers and commodity descriptions in Supplement No. 1 of Part 754. The descriptions are derived from the 2014 Schedule B and the AES 2014 Export Concordance (December 30, 2013) (“AES 2014 Export Concordance”), http://www.census.gov/​foreign-trade/​aes/​documentlibrary/​expaes.txt. The AES 2014 Export Concordance includes Schedule B numbers and commodity descriptions that reflect consolidations of descriptions that appear at the subheading level in the 2014 Schedule B. The footnote that provided a source for the table has been removed, and the information that was in the footnote has been incorporated into introductory text to the Supplement.
Included in the introduction chapter to the 2014 Schedule B are rules of interpretation, which provide information on how to read and interpret the Schedule B list. Also, there are Notes at the beginning of Chapter 27 of the 2014 Schedule B that pertain specifically to products in this chapter. For example, Note 6 under the Statistical Notes states, “In determining the relative weights of components of the mixtures provided for in subheading 2710.11.45 and 2710.19.45, naphtha and other petroleum derivatives which may be present in such mixtures as solvents shall be disregarded.” Therefore, it is important to read the rules of interpretation and all the notes at the beginning of chapter 27 that pertain to your products in order to properly classify your product.
Supplement No. 2 contains three Schedule B numbers, 200.3516, 200.2820, and 202.2840, for unprocessed western red cedar. As a result of significant modifications to Schedule B numbers that have taken place over the years, these three numbers are now obsolete. Additionally, the current commodity descriptions are incomplete as they only include western red cedar logs and timber, lumber (rough and containing wane), and lumber (dressed or worked, containing wane). This rule updates the three Schedule B numbers and commodity descriptions in Supplement No. 2 of Part 754. To determine if your Western Red Cedar (WRC) product requires a license, see § 754.4 of the EAR.
This rule replaces the three obsolete Schedule B numbers of unprocessed western red cedar, and adds five new numbers, for a total of eight Schedule B numbers drawn from the Schedule B 2014. The eight numbers are divided into two groups: wood in the rough and lumber. The accompanying commodity descriptions may have terms with single quotes, which indicate that a definition may be found in the notes below the table. The descriptions in this supplement were derived from the 2014 Schedule B and the AES 2014 Export Concordance. This rule also adds definitions for three terms, `treated,' `lumber,' and `rough,' that appear in commodity description listings in the Schedule B 2014, as Notes to Supplement No. 2. Including these definitions will help exporters better understand the commodity descriptions in the supplement.
If there are any discrepancies between the information in Supplement No. 2 and the information in the most current Schedule B, which is updated on an annual basis, you should use the most current Schedule B number in your Electronic Export Information filing in the Bureau of the Census's Automated Export System.
This rule also makes an administrative change to remove the Unit column in the table for Unprocessed Western Red Cedar in Supplement No. 2 to part 754 as “Unit” was removed from the Commerce Control List on January 6, 2014 (78 FR 61874).
This rule amends § 742.1(b)(1) by adding the word “certain” to the description of ECCN 1C983, because only natural gas liquids and other natural gas derivatives that were produced or derived from the Naval Petroleum Reserves (NPR) or became available for export as a result of an exchange of any NPR produced or derived commodities are controlled by the short supply reason for control in part 754 of the EAR. This rule also adds the word “unprocessed” to the description of ECCN 1C988, because only unprocessed western red cedar is controlled by the short supply reason for control in part 754 of the EAR.
This rule amends § 754.1 by revising subpart (b)(1)(iii) to remove the language “listed in Supplement No. 2 to this part.” This revision, which is also reflected in § 754.4, delinks the license requirement from the listings in Supplement No. 2 to part 754. This revision clarifies that exporters must consult § 754.4, not Supplement No. 2 to part 754, to determine the license requirements for unprocessed western red cedar products controlled under ECCN 1C988. Section 754.4 contains definitions of “unprocessed” western red cedar and other key terms that are relevant to the scope of the license requirements. The revision is consistent with the understanding that the Supplement No. 2 Schedule B listings are not exhaustive. The listings (and the Schedule B more generally) do not capture the full range of products that may meet the definition of “unprocessed western red cedar” for purposes of § 754.4 of the EAR.
This rule amends § 754.4 by revising the introductory text to paragraph (a). The introductory text to paragraph (a) is amended to remove the language “listed in Supplement No. 2 to this part,” consistent with the revision made to § 754.1. A new sentence is added to reference and explain the revised listings in Supplement No. 2. An editorial change is also made to put in lower case the words “license exception” in the last sentence of the introductory text to paragraph (a).
This rule amends the heading of ECCN 1C988 by adding the word “unprocessed” to be more precise about the control. The reference to Supplement No. 2 to part 754 of the EAR is replaced by a reference to § 754.4 of the EAR, thereby clarifying that exporters should consult § 754.4 to determine the licensing requirements that apply to unprocessed western red cedar. The license requirement of ECCN 1C988 is based on the definitions and other information in § 754.4 of the EAR. The Related Definitions paragraph in the List of Items Controlled section of ECCN 1C988 is amended to add a reference to and description of Supplement No. 2 to part 754.
These clarifying changes do not alter or otherwise affect BIS's current practice with respect to the enforcement of the EAR's controls on unprocessed western red cedar.
Since August 21, 2001, the Export Administration Act of 1979, as amended, has been in lapse. However, the President, through Executive Order 13222 of August 17, 2001, 3 CFR, 2001 Comp., p. 783 (2002), as amended by Start Printed Page 34410Executive Order 13637 of March 8, 2013, 78 FR 16129 (March 13, 2013), and as extended by the Notice of August 8, 2013, 78 FR 49107 (August 12, 2013) has continued the EAR in effect under the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.). BIS continues to carry out the provisions of the Export Administration Act, as appropriate and to the extent permitted by law, pursuant to Executive Order 13222 as amended by Executive Order 13637.
2. 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. This regulation involves collections previously approved by the OMB under the following control numbers: 0694-0088 (Simplified Network Application Processing and Multipurpose Application Form).
This final rule would not increase public burden in a collection of information approved by OMB under control number 0694-0088, which authorizes, among other things, export license applications, because it is simply updating the Schedule B numbers and commodity descriptions for certain commodities in Supplement No. 1 of part 754 and making certain limited corrections to §§ 742.1, 754.1 and 754.4.
4. The Department finds that there is good cause under 5 U.S.C. 553(b)(B) to waive the provisions of the Administrative Procedure Act requiring prior notice and the opportunity for public comment because they are unnecessary. The revisions made by this rule are administrative, not substantive, in nature and merely update the EAR to reflect changes to regulations referenced therein so that those references are harmonized with revisions that have been made to the Census Bureau's Schedule B 2014 publication, e.g., updating commodity descriptions, removing obsolete Schedule B Numbers, and adding new Schedule B numbers. The rule does not affect the rights and obligations of the public. Because these revisions are not substantive changes to the EAR, it is unnecessary to provide prior notice and opportunity for public comment.
In addition, the 30-day delay in effectiveness required by 5 U.S.C. 553(d) is not applicable because this rule is not a substantive rule. As stated above, these revisions do not alter any rights or obligations, but merely correct citations and definitions set forth in the EAR so that those references are harmonized with revisions that have been made to the Bureau of the Census' Schedule B 2014 publication, e.g., updating commodity descriptions, removing obsolete Schedule B Numbers, and adding new Schedule B numbers. The revisions are necessary to facilitate public understanding of the EAR's short supply controls on unprocessed western red cedar, crude oil, and petroleum products. Accordingly, no benefit would be gained by delaying this rule's effectiveness for 30 days.
Accordingly, Parts 742, 754 and 774 of the Export Administration Regulations (15 CFR parts 730-774) are amended as follows:
2. Section 742.1 is amended by revising paragraph (b)(1) to read as follows:
(1) Short Supply. ECCNs containing items subject to short supply controls (“SS”) refer the exporter to part 754 of the EAR. These ECCNs are: 0A980 (Horses for export by sea); 1C980 (certain inorganic chemicals); 1C981 (Crude petroleum, including reconstituted crude petroleum, tar sands, and crude shale oil); 1C982 (certain other petroleum products); 1C983 (certain natural gas liquids and other natural gas derivatives); 1C984 (certain manufactured gas and synthetic natural gas (except when commingled with natural gas and thus subject to export authorization from the Department of Energy); and 1C988 (Unprocessed western red cedar (thuja plicata) logs and timber, and rough, dressed and worked lumber containing wane).
3. The authority citation for 15 CFR part 754 continues to read as follows:
4. Section 754.1 is amended by revising paragraph (b)(1)(iii) to read as follows:
(1) * * *Start Printed Page 34411
(iii) Unprocessed western red cedar described by ECCN 1C988 (Western red cedar (thuja plicata) logs and timber, and rough, dressed and worked lumber containing wane). For specific licensing requirements for these items, see § 754.4 of this part.
5. Section 754.4 is amended by revising the introductory text to paragraph (a), to read as follows:
6. Revise Supplement No. 1 to Part 754 to read as set forth below:
This Supplement provides relevant Schedule B numbers and a commodity description of the items controlled by ECCNs 1C980, 1C981, 1C982, 1C983, and 1C984. The 10-digit Harmonized System-based Schedule B commodity numbers and descriptions below are drawn from Chapter 27 of the Schedule B 2014 found at and the AES 2014 Export Concordance (December 30, 2013) http://www.census.gov/​foreign-trade/​aes/​documentlibrary/​expaes.txt. If there are any discrepancies between the information in this supplement and the information in the most current Schedule B, use the most current Schedule B commodity number on your Electronic Export Information filing on the Automated Export System.
3819000000 Hydraulic brake fluids and other prepared liquids for hydraulic transmission, not containing or containing less than 70 percent by weight of petroleum oils or oils obtained from bituminous minerals.
7. Revise Supplement No. 2 to Part 754 to read as set forth below:
This table is a non-exhaustive list of 10-digit Harmonized System-based Schedule B commodity numbers that may apply to unprocessed western red cedar products subject to license requirements of § 754.4 of this part. The 10-digit Harmonized System-based Schedule B commodity numbers and descriptions below are drawn from Chapter 44 of the Schedule B 2014 found at http://www.census.gov/​foreign-trade/​schedules/​b/​2014/​c44.html and the AES 2014 Export Concordance (December 30, 2013) http://www.census.gov/​foreign-trade/​aes/​documentlibrary/​expaes.txt. If there are any discrepancies between the information in this supplement and the information in the most current Schedule B, use the most current Schedule B commodity number on your Electronic Export Information filing in the Automated Export System.
4403100030 Poles, piles and posts; `treated'.
4403100060 Wood in the rough; `treated'.
4403200010 Not `treated'; coniferous; poles, piles and posts.
4403200055 Not `treated'; coniferous; logs and timber; Western Red Cedar (Thuja Plicata).
`Lumber'
4407100102 Coniferous; except finger-jointed; `treated'.
4407100168 Coniferous; except finger-jointed; not `treated'; Western Red Cedar (Thuja Plicata); `rough'.
4407100169 Coniferous; except finger-jointed; not `treated'; Western Red Cedar (Thuja Plicata); not `rough'.
4403 heading in the Schedule B 2014 pertains to “wood in the rough, whether or not stripped of bark or sapwood, or roughly squared (not including lumber of heading 4407).”
The 6-digit Harmonized System subheading 4403.10 and the 10-digit Harmonized System code 4407.10.0102 in Schedule B 2014 state that `treated' means “treated with paint, stain, creosote or other preservatives.”
The 4407 heading in the Schedule B 2014 refers to `lumber' as “wood sawn or Start Printed Page 34413chipped lengthwise, sliced or peeled, whether or not planed, sanded or end‐jointed, of a thickness exceeding 6mm (.236 inch).”
Section IX—Chapter 44 of Schedule B 2014, Statistical Note 3 states, “for the purpose of heading 4407, the term “rough” includes wood that has been edged, resawn, crosscut or trimmed to smaller sizes but it does not include wood that has been dressed or surfaced by planing on one or more edges or faces or has been edge-glued or end-glued.”
9. In Supplement No. 1 to part 774 (the Commerce Control List), Category 1, ECCN 1C988 is amended by revising the Heading and the Related Definitions paragraph in the List of Items Controlled section, to read as follows:
1C988 Unprocessed western red cedar (thuja plicata) logs and timber, and rough, dressed and worked lumber containing wane, as described in § 754.4 of the EAR.
Related Definitions: For a non-exhaustive list of 10-digit Harmonized System-based Schedule B commodity numbers that may apply to unprocessed Western Red Cedar products subject to § 754.4 and related definitions, see Supplement No. 2 to part 754 of the EAR.
[FR Doc. 2014-14157 Filed 6-16-14; 8:45 am]