Source: https://www.federalregister.gov/documents/2020/02/18/2020-03144/temporary-general-license-extension-of-validity
Timestamp: 2020-02-27 17:46:26
Document Index: 228443297

Matched Legal Cases: ['art 744', 'arts 744', 'arts 730', 'art 744', 'art 744', 'art 762']

A Rule by the Industry and Security Bureau on 02/18/2020
This rule is effective February 13, 2020, through April 1, 2020, except for amendatory instructions 1 and 3, which are effective February 13, 2020.
Docket No. 200211-0051
BIS-2020-0003
https://www.federalregister.gov/d/2020-03144 https://www.federalregister.gov/d/2020-03144
As published on May 22, 2019 (84 FR 23468) and extended and amended through a final rule published on August 21, 2019 (84 FR 43487), this temporary general license authorizes certain activities, including those necessary for the continued operations of existing networks and equipment as well as the support of existing mobile services, including cybersecurity research critical to maintaining the integrity and reliability of existing and fully operational networks and equipment. Exporters, reexporters, and transferors are required to maintain certifications and other records, to be made available when requested by BIS, regarding their use of the temporary general license. The expiration date was again updated through February 16, 2020 (84 FR 64018, Nov. 20, 2019).
As published on May 22, 2019 (84 FR 22961), and as revised and clarified by a final rule published on August 21, 2019 (84 FR 43493), any exports, reexports, or in-country transfers of items subject to the EAR to any of the listed Huawei entities as of the effective date they were added to the Entity List continue to require a license, with the exception of transactions explicitly authorized by the temporary general license and eligible for export, reexport, or transfer (in-country) prior to May 16, 2019 without a license or under a license exception. License applications will continue to be reviewed under a presumption of denial, as stated in the Entity List entries for the listed Huawei Start Printed Page 8723entities. No persons are relieved of other obligations under the EAR, including but not limited to licensing requirements to the People's Republic of China (PRC or China) or other destinations and the requirements of part 744 of the EAR. The temporary general license also does not authorize any activities or transactions involving Country Group E countries (i.e., Cuba, Iran, North Korea, Sudan, and Syria) or foreign nationals.
Accordingly, parts 744 and 762 of the Export Administration Regulations (15 CFR parts 730 through 774) is amended as follows:
2. Supplement No. 7 to part 744 is added to read as follows:
Notwithstanding the requirements and other provisions of Supplement No. 4 to this part, which became effective as to Huawei Technologies Co., Ltd. (Huawei), Shenzhen, Guangdong, China on May 16, 2019, and its non-U.S. affiliates listed in Supplement No. 4 to this part on, as applicable, May 16, 2019 or August 19, 2019, the licensing and other requirements in the EAR as of May 15, 2019, are restored in part as of May 20, 2019, and through April 1, 2020, pertaining to exports, reexports, and transfers (in-country) of items subject to the EAR to any of the listed Huawei entities. The licensing and other policies of the EAR that were in effect as of May 15, 2019, are available to export, reexport, or transfer (in-country) such items to the listed Huawei entities if the transaction meets the conditions of paragraph (b) of this supplement, is limited in scope to one or more of the activities described in paragraphs (c)(1) through (3) of this supplement, and if the transaction parties satisfy the requirements of paragraph (d)(1) of this supplement and, if applicable, paragraph (d)(2) of this supplement. Thus, for example, the authority of NLR or a License Exception that was available as of May 15, 2019, may be used in connection with a transaction as per this temporary general license.
(a) Identification of non-U.S. affiliates. The non-U.S. affiliates to whom the licensing and other Start Printed Page 8724requirements of the EAR are restored as described herein are those Huawei entities and affiliates added to the Entity List through the Federal Register documents listed in paragraphs (a)(1) and (2) of this supplement:
(b) Conditions for use of temporary general license. Use of this temporary general license is subject to the following conditions:
(1) This temporary general license is effective from May 20, 2019, through April 1, 2020.
(2) This temporary general license does not resolve persons of other obligations under the EAR, including but not limited to licensing requirements to the People's Republic of China or elsewhere and/or the requirements of part 744 of the EAR. This authorization does not authorize any activities or transactions involving Country Group E countries (i.e., Cuba, Iran, North Korea, Sudan and Syria) or persons.
(3) With the exception of those explicitly authorized in this temporary general license, exports, reexports, transfers (in-country) continue to require a license pursuant to the licensing policy described on the Entity List and license applications will be reviewed under the license review policy for that entry.
(c) Authorized transactions. This temporary general license allows, from May 20, 2019, through April 1, 2020, the following:
(1) Continued operation of existing networks and equipment. BIS authorizes, subject to other provisions of the EAR, engagement in transactions necessary to maintain and support existing and currently 'fully operational network' and equipment, including software for bug fixes, security vulnerability patches, and other changes to existing versions of the software, subject to legally binding contracts and agreements executed between Huawei, or one of its listed non-U.S. affiliates, and 'third parties' on or before May 16, 2019. Such transactions may not enhance the functional capacities of the original software or equipment.
(i) Exclusions. (A) The authorization under paragraph (c)(1) of this supplement extends only to activities such as patching networks and network infrastructure equipment, not end-devices such as general-purpose computing devices that would not be considered to be part of an existing and 'fully operational network.' Paragraph (c)(1) of this supplement does not authorize support for equipment that is not directly related to the support and maintenance of the network.
(B) The provision of the temporary general license under paragraph (c)(1) of this supplement does not authorize transfers of equipment for general business purposes or for activities that are not in direct support of an existing and ‘fully operational network' (e.g., semiconductor production equipment).
Note 1 to paragraph (c)(1): The term ‘third parties' in paragraph (c)(1) of this supplement and the term 'third party' in Notes 2 and 3 to paragraph (c)(1) refer to a party that is not Huawei, one of its listed non-U.S. affiliates, or the exporter, reexporter, or transferor, but rather an organization such as a telecommunications service provider.
Note 2 to paragraph (c)(1): The term ‘fully operational network' in paragraph (c)(1) of this supplement, as well as in paragraph (c)(3) of the supplement, refers to a ‘third party' network providing services to the ‘third party's' customers.
(2) Support to existing ‘personal consumer electronic devices' and ‘Customer Premises Equipment (CPE)'. BIS authorizes, subject to other provisions of the EAR, engagement in transactions necessary to provide service and support, including software for bug fixes, security vulnerability patches, and other changes to existing versions of the software, to existing Huawei ‘personal consumer electronic devices.' Such transactions may not enhance the functional capacities of the original software or equipment. For the purposes of this paragraph (c)(2), the term ‘personal consumer electronic devices' is defined as including phones and other personally-owned equipment, such as a tablets, smart watches, and mobile hotspots such as MiFi devices. The authorized transactions under this paragraph (c)(2) include support for personal use of telecommunications hardware known as ‘Customer Premises Equipment (CPE),' such as network switches, residential internet gateways, set-top boxes, home networking adapters and other personally-owned equipment that enables consumers to access network communications services and distribute them within their residence or small business. The authorization conferred by this paragraph (c)(2) is limited to models of Huawei ‘personal consumer electronic devices' and ‘CPE' that were available to the public on or before May 16, 2019.
(3) Cybersecurity research and vulnerability disclosure. BIS authorizes, subject to other provisions of the EAR, the disclosure to Huawei and/or to its listed non-U.S. affiliates of information regarding security vulnerabilities in items owned, possessed, or controlled by Huawei or any of its non-U.S. affiliates when related to the process of providing ongoing security research critical to maintaining the integrity and reliability of existing and currently ‘fully operational network' and equipment.
(1) Certification statement required from Huawei or one of its listed non-U.S. affiliates. Prior to any export, reexport, or transfer (in-country) under the temporary general license to Huawei or any of its listed non-U.S. affiliates identified in paragraph (a) of this supplement, the exporter, reexporter, or transferor must obtain a certification statement from the entity that will receive the item(s). The temporary general license also requires the party exporting, reexporting, or transferring (in-country) an item “subject to the EAR” to obtain, from the listed Huawei entity receiving the item, a certification statement under paragraph (d) of this supplement specifying how the export, reexport, or in-country transfer satisfies the provisions of the temporary general license, including specifying whether the activity or activities that will be supported by the transaction fall within paragraph (c)(1), (2), or (3) of this supplement. In order to substantiate the certification statement for transactions that fall within paragraph (c)(1), the exporter, reexporter, or transferor must obtain documentation from Huawei or one of its listed non-U.S. affiliates showing that there was a legally binding contract or agreement executed between the listed Huawei entity and a 'third party' on or before May 16, 2019. The exporter, reexporter, or transferor and the listed Huawei entity are each responsible for retaining the certification statement and any additional support documentation needed to substantiate the certification statement under paragraph (d). See part 762 of the EAR for record retention requirements. The certification statement must be in writing (which may be conveyed by email), be signed and dated by an individual of sufficient authority to legally bind the listed Start Printed Page 8725entity, and shall provide the information required in paragraphs (d)(1)(i) and (ii) of this supplement and the certifications specified in paragraphs (d)(1)(iii) through (v) of this supplement.
4. Section 762.2 is amended by adding paragraph (b)(55) to read as follows:
[FR Doc. 2020-03144 Filed 2-13-20; 4:15 pm]