[Federal Register: August 3, 1999 (Volume 64, Number 148)]
[Rules and
Regulations]
[Page 42009-42012]
From the Federal Register Online via
GPO Access
[wais.access.gpo.gov]
[DOCID:fr03au99-5]
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DEPARTMENT
OF COMMERCE
Bureau of Export Administration
15 CFR Parts 734, 738,
740, and 742
[Docket No. 990709187-9187-01]
RIN
0694-AB96
Revision of High Performance Computer Licensing
Policy
AGENCY: Bureau of Export Administration, Commerce.
ACTION:
Final
rule.
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SUMMARY:
The Bureau of Export Administration (BXA) is amending the
Export
Administration Regulations (EAR) by raising the performance
parameters
for those computers which can be exported and reexported
under License
Exception CTP. The upper threshold of the Composite
Theoretical
Performance (CTP) parameter for Computer Tier 2 countries
is raised
from 10,000 millions of theoretical operations per second
(MTOPS) to
20,000 MTOPS. The upper threshold for Computer Tier 3
countries is
raised from 7,000 MTOPS to 12,300 MTOPS for civilian end-
users and end-uses.
For military end-users and end-uses in Computer
Tier 3 destinations the
CTP parameter remains at 2,000 MTOPS for the
immediate future. The
upper parameter for military end-users and end-
uses to Computer Tier 3
countries will be raised from 2,000 MTOPS to
6,500 MTOPS on the same
date the threshold for advance notification for
high performance
computers (HPC) exports to Tier 3 countries is raised
from 2,000 MTOPS
to 6,500 MTOPS. The threshold for advance notification
for exports of
HPCs to Tier 3 countries is raised to 6,500 MTOPS,
effective
approximately 180 days following the submission of a
statutorily
mandated report to Congress. The President sent this report
to Congress
on July 26, 1999. In addition, the following countries are
moved from
Computer Tier 2 to Computer Tier 1: Brazil, the Czech
Republic,
Hungary, and Poland.
DATES: This rule is effective August 3,
1999.
FOR FURTHER INFORMATION CONTACT: James A. Lewis, Office of
Strategic
Trade and Foreign Policy Controls, Bureau of Export
Administration,
Telephone: (202) 482-4196.
SUPPLEMENTARY
INFORMATION:
Background
On January 25, 1996, the Bureau of Export
Administration created
License Exception CTP for exports and reexports
of HPCs. This policy
took into account rapid technical advances in
computing power, as well
as national security and nonproliferation
concerns. License Exception
CTP divided the world into tiers based on
U.S. national security and
foreign policy interests. These tiers
represent the level of
proliferation and security risk a country poses
to the U.S. and, as a
result, the technical level of computer exports
tier members can
receive without applying for an export license.
Computer Tier 1
consists of close U.S. allies; Computer Tier 2 includes
countries
representing minimal security concerns to the U.S;
countries
representing a potential proliferation or security concern
are listed
in Computer Tier 3; and Computer Tier 4 consists of
terrorist
supporting states.
The President has decided to amend
these country tiers by
transferring Brazil, the Czech Republic,
Hungary, and Poland from Tier
2 to Tier 1. The Administration will
consider moving additional
countries between Computer Tiers in the
future.
The rapid evolution of computer technology has also made
CTP
parameter revisions necessary. This rule changes the upper
threshold of
the CTP
[[Page 42010]]
parameter for
Computer Tier 2 from 10,000 MTOPS to 20,000 MTOPS and the
upper
threshold of Computer Tier 3 countries from 7,000 MTOPS to 12,300
MTOPS
for civilian end-users and end-uses. License Exception CTP will
be made
available for military end-users and end-uses in Computer Tier
3 in
approximately 180 days along with the raising of the
advance
notification level under the 1998 National Defense
Authorization Act
(NDAA) from 2,000 MTOPS to 6,500 MTOPS. Revision of
the advance
notification threshold will be effective 180 days after the
submission
by the President of a required report notifying the Congress
of this
change. The President sent this report to Congress on July 26,
1999.
Following this 180 day period, the upper parameter will be raised
from
2,000 MTOPS to 6,500 MTOPS for military end-users and end-uses
in
Computer Tier 3. This level reflects the Administration's
determination
that widespread commercial availability makes computers
with a
performance of 6,500 MTOPS or less uncontrollable. Note that
the
advance notification requirements of the 1998 NDAA for exports
and
reexports of computers with a CTP greater than 2,000 MTOPS to
Computer
Tier 3 destinations remains in effect until such changes are
reviewed
by the U.S. Congress.
This rule does not have an immediate
impact on post-shipment
reporting and record keeping requirements
compelled by the 1998 NDAA
for HPC exports. All HPC exports with a CTP
greater than 2,000 MTOPS to
Tier 3 Countries still require
post-shipment reporting. However, BXA
may, prior to January 23, 2000,
publish an additional rule regarding
further reporting requirements to
meet stipulations under the 1998 NDAA
to provide the Congress an annual
report on all HPC exports to Computer
Tier 3 destinations. This
potential rule will most likely require HPC
exporters to report the
intended end-use of all HPC exports with a CTP
greater than 2,000 MTOPS
but less than or equal to 6,500 MTOPS to
Computer Tier 3 destinations.
This information is currently provided by
exporters in their advance
notification requests for computers with a
CTP greater than 2,000 MTOPS
to Computer Tier 3 destinations. In light
of the rapid technological
advancement in HPCs, the United States will
routinely review these
licensing levels to determine if further
adjustments are warranted. In
particular, for Tier 2, the United States
will review the licensing
level in six months with the expectation of
raising the level to the
32,000 to 36,000 MTOPS range. Changes to Tier
3 may also be made at
that time.
This rule specifically amends the EAR in the following ways:
1.
In section 740.7, Brazil, the Czech Republic, Hungary, and
Poland are
moved from Computer Tier 2 to Computer Tier 1, and the upper
threshold
of the CTP parameter for Computer Tier 2 is raised from
10,000 MTOPS to
20,000 MTOPS.
2. In section 740.7, the upper threshold of the CTP parameter
for
Computer Tier 3 is raised from 7,000 MTOPS to 12,300 MTOPS for
civilian
end-users and end-uses. The upper parameter for military
end-users and
uses is raised from 2,000 MTOPS to 6,500 MTOPS, effective
January 23,
2000.
3. In section 740.7, the CTP level for computers
requiring advance
notification for export and reexport to Computer Tier
3 destinations is
raised from 2,000 MTOPS to 6,500 MTOPS, effective
January 23, 2000.
4. In section 740.11 and Supplement No. 1 to section
740.11, the
CTP level for computers not eligible for License Exception
GOV is
raised from 10,000 MTOPS to 20,000 MTOPS.
5. In section
742.12, the upper threshold of the CTP parameter as
measured in MTOPS
for Computer Tier 2 is raised from 10,000 MTOPS to
20,000 MTOPS.
6.
In section 742.12, the upper threshold of the CTP parameter
for
Computer Tier 3 is raised from 7,000 MTOPS to 12,300 MTOPS for
civil
end-users and end-uses. Effective January 23, 2000, the upper
threshold
of the CTP parameter for Computer Tier 3 is raised from 2,000
MTOPS to
6,500 MTOPS for military end-users and end-uses.
Although
the Export Administration Act (EAA) expired on August 20,
1994, the
President invoked the International Emergency Economic Powers
Act and
continued in effect the EAR, and to the extent permitted by
law, the
provisions of the EAA, as amended, in Executive Order 12924 of
August
19, 1994, as extended by the President's notices of August 15,
1995 (60
FR 42767), August 14, 1996 (61 FR 42527) August 13, 1997 (62
FR 43629)
and August 13, 1998 (63 FR 44121).
Rule Making Requirements
1.
This final rule has been determined to be significant for
purposes of
E.O. 12866.
2. Notwithstanding any other provision of law, no person
is
required to respond to nor be subject to a penalty for failure
to
comply with a collection of information subject to the requirements
of
the Paperwork Reduction Act unless that collection of
information
displays a current valid OMB Control Number. This
regulation involves
collections previously approved by the Office of
Management and Budget
under control numbers 0694-0088, ``Multi-Purpose
Application,'' which
carries a burden hour estimate of 45 minutes per
manual submission and
40 minutes per electronic submission.
Miscellaneous and recordkeeping
activities account for 12 minutes per
submission. In addition,
information is also collected under OMB
control number 0694-0107,
``National Defense Authorization Act,''
Advance Notifications and Post-
Shipment Verification reports.
3. This
rule does not contain policies with Federalism implications
sufficient
to warrant preparation of a Federalism assessment under
Executive Order
12612.
4. The provisions of the Administrative Procedure Act
requiring
notice of proposed rule making, the opportunity for
public
participation, and a delay in effective date, are inapplicable
because
this regulation involves a military or foreign affairs function
of the
United States (see 5 U.S.C. 553(a)(1)). Further, no other law
requires
that a notice of proposed rule making and an opportunity for
public
comment be given for this rule. Because a notice of proposed
rule
making and opportunities for public comment are not required to
be
given for this rule by 5 U.S.C. 553, or by any other law,
the
analytical requirements of the Regulatory Flexibility Act, 5 U.S.C.
601
et seq., are inapplicable.
Therefore, this regulation is issued
in final form. Although there
is no formal comment period, public
comments on this regulation are
welcome on a continuing basis. Comments
should be submitted to Frank J.
Ruggiero, Office of Exporter Services,
Bureau of Export Administration,
Department of Commerce, P.O. Box 273,
Washington, D.C. 20044.
List of Subjects
15 CFR Part
734
Administrative practice and procedure, Exports, Foreign
trade.
15 CFR Part 738
Administrative practice and procedure,
Exports, Foreign trade.
15 CFR Part 740
Administrative practice
and procedure, Exports, Foreign trade,
Reporting and recordkeeping
requirements.
[[Page 42011]]
15 CFR Part 742
Exports,
Foreign Trade.
Accordingly, parts 734, 738, 740, and 742 of the
Export
Administration Regulations (15 CFR Parts 730-774) are amended
as
follows:
1. The authority citation for 15 CFR part 734 is revised
to read as
follows:
Authority: 50 U.S.C. app. 2401 et seq., 1701
et seq.; E.O.
12924, 3 CFR, 1994 Comp., p. 917; E.O. 12938, 3 CFR, 1994
Comp., p.
950; E.O. 13020, 3 CFR, 1996 Comp., p. 219; E.O. 13026, 3
CFR, 1996
Comp., p. 228; and Notice of August 13, 1998, 63 FR 44121, 3
CFR,
1998 Comp., p. 294.
2. The authority citation for 15 CFR
Part 738 is revised to read as
follows:
Authority: 50 U.S.C.
app. 2401 et seq.; 50 U.S.C. 1701 et seq.;
10 U.S.C. 7420; 10 U.S.C.
7430(e); 18 U.S.C. 2510 et seq.; 22 U.S.C.
287c; 22 U.S.C. 3201 et
seq.; 22 U.S.C. 6004; 30 U.S.C. 185(s),
185(u); 42 U.S.C. 2139a; 42
U.S.C. 6212; 43 U.S.C. 1354; 46 U.S.C.
app. 466c; 50 U.S.C. app. 5;
E.O. 12924, 59 FR 43437, 3 CFR, 1994
Comp., p. 917; E.O. 13026, 61 FR
58767, 3 CFR, 1996 Comp., p. 228;
and Notice of August 13, 1998, 63 FR
44121, 3 CFR 1998 Comp., p.
294.
3. The authority citation for
15 CFR Part 740 is revised to read as
follows:
Authority: 50
U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;
E.O. 12924, 59 FR
43437, 3 CFR, 1994 Comp., p. 917; E.O. 13026, 61
FR 58767, 3 CFR, 1996
Comp., p. 228; and Notice of August 13, 1998,
63 FR 44121, 3 CFR 1998
Comp., p. 294.
4. The authority citation for 15 CFR Part 742 is revised
to read as
follows:
Authority: 50 U.S.C. app. 2401 et seq.; 50
U.S.C. 1701 et seq.;
18 U.S.C. 2510 et seq.; 22 U.S.C. 3201 et seq.; 42
U.S.C. 2139a;
E.O. 12058, 43 FR 20947, 3 CFR, 1978 Comp., p. 179; E.O.
12851, 3
CFR, 1993 Comp., p. 608; E.O. 12924, 59 FR 43437, 3 CFR, 1994
Comp.,
p. 917; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950;
E.O.
13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; and Notice of
August
13, 1998, 63 FR 44121, 3 CFR 1998 Comp., p. 294.
PART
734--[AMENDED]
Sec. 734.4 [Amended]
5. Section 734.4 is
amended by revising the phrase ``7,000 MTOPS''
in paragraph (a) to read
``12,300 MTOPS''.
PART 738--[AMENDED]
6. Supplement No. 1 to Part
738 is amended by revising the phrase
``greater than 10,000 MTOPS'' in
the second footnote to read ``greater
than 20,000 MTOPS''.
PART
740--[AMENDED]
7. Section 740.7 is amended by:
a. Revising paragraphs
(b)(1) and (c);
b. Revising paragraphs (d)(2) and (d)(3); and
c. Revising
paragraphs (d)(5)(i) and (d)(5)(v) introductory text to
read as
follows:
Sec. 740.7 Computers (CTP).
* * * * *
(b) Computer
Tier 1--(1) Eligible countries. The countries that are
eligible to
receive exports and reexports under this License Exception
are
Australia, Austria, Belgium, Brazil, Czech Republic, Denmark,
Finland,
France, Germany, Greece, the Holy See, Hungary, Iceland,
Ireland,
Italy, Japan, Liechtenstein, Luxembourg, Mexico, Monaco,
Netherlands,
New Zealand, Norway, Poland, Portugal, San Marino, Spain,
Sweden,
Switzerland, Turkey, and the United Kingdom.
* * * * *
(c) Computer Tier
2--(1) Eligible countries. The countries that are
eligible to receive
exports under this License Exception include
Antigua and Barbuda,
Argentina, Bahamas, Barbados, Bangladesh, Belize,
Benin, Bhutan,
Bolivia, Botswana, Brunei, Burkina Faso, Burma, Burundi,
Cameroon, Cape
Verde, Central Africa, Chad, Chile, Colombia, Congo,
Costa Rica, Cote
d'Ivoire, Cyprus, Dominica, Dominican Republic,
Ecuador, El Salvador,
Equatorial Guinea, Eritrea, Ethiopia, Fiji,
Gabon, Gambia (The), Ghana,
Grenada, Guatemala, Guinea, Guinea-Bissau,
Guyana, Haiti, Honduras,
Hong Kong, Indonesia, Jamaica, Kenya,
Kiribati, Korea (Republic of),
Lesotho, Liberia, Madagascar, Malawi,
Malaysia, Maldives, Mali, Malta,
Marshall Islands, Mauritius,
Micronesia (Federated States of),
Mozambique, Namibia, Nauru, Nepal,
Nicaragua, Niger, Nigeria, Palau,
Panama, Papua New Guinea, Paraguay,
Peru, Philippines, Rwanda, St.
Kitts & Nevis, St. Lucia, St. Vincent
and Grenadines, Sao Tome
& Principe, Senegal, Seychelles, Sierra Leone,
Singapore, Slovak
Republic, Slovenia, Solomon Islands, Somalia, South
Africa, Sri Lanka,
Surinam, Swaziland, Taiwan, Tanzania, Togo, Tonga,
Thailand, Trinidad
and Tobago, Tuvalu, Uganda, Uruguay, Venezuela,
Western Sahara, Western
Samoa, Zaire, Zambia, and Zimbabwe.
(2) Eligible computers. The computers
eligible for License
Exception CTP to Tier 2 destinations are those
having a CTP greater
than 2,000 MTOPS, but less than or equal to 20,000
MTOPS.
(d) * * *
(2) Eligible computers. The computers eligible for
License
Exception CTP to Tier 3 destinations are those having a CTP
greater
than 2,000 MTOPS, but less than or equal to 12,300 MTOPS for
civil end-
users and end-uses. Beginning on January 23, 2000, computers
having a
CTP greater than 2,000 MTOPS but less than or equal to 6,500
MTOPS are
eligible for License Exception CTP to military end-users and
end-uses
subject to the restrictions in paragraph (d)(3) of this
section.
(3) Eligible exports. Only exports and reexports to permitted
end-
users and end-uses located in countries in Computer Tier 3.
License
Exception CTP does not authorize exports and reexports to
Computer Tier
3 for nuclear, chemical, biological, or missile end-users
and end-uses
and military end-users and end-uses subject to license
requirements
under Sec. 744.2, Sec. 744.3, 0Sec. 744.4, Sec. 744.5, and
Sec. 744.12
of the EAR. Such exports and reexports will continue to
require a
license and will be considered on a case-by-case basis.
Retransfers to
defined proliferation end-users and end-uses in eligible
countries is
strictly prohibited without prior authorization.
(4) *
* *
(5) NDAA notification--(i) General requirement. The
National
Defense Authorization Act (NDAA) of FY98 enacted on November
18, 1997
requires advance notification of certain exports and reexports
of
computers to Computer Tier 3 countries. Prior to January 23,
2000,
advance notification is required for all exports and reexports
of
computers with a CTP between 2,000 and 12,300 MTOPS to Computer Tier
3
destinations. Beginning on January 23, 2000, advance notification
is
required for all exports and reexports of computers with a CTP
between
6,500 and 12,300 MTOPS to Computer Tier 3 destinations. For
each such
transaction destined to Computer Tier 3, prior to using
License
Exception CTP, you must first notify BXA by submitting a
completed
Multipurpose Application Form (BXA-748P). The Multipurpose
Application
Form must be completed including all information required
for a license
application according to the instructions described in
Supplement No. 1
to part 748 of the EAR, with two exceptions. You (the
applicant as
listed in Block 14) shall in Block 5 (Type of Application)
mark the box
``Other.'' This designator will permit BXA to route the
NDAA notice
into a special processing procedure. (Blocks 6 and 7,
regarding support
documentation, may be left blank.) You must also
provide a notice using
this procedure prior to exporting or reexporting
items that you know
will be used to enhance beyond 2,000 MTOPS the CTP
of a previously
exported or reexported computer. Beginning on January
23, 2000, you
must provide a notice using this
[[Page
42012]]
procedure prior to exporting or reexporting items that you know
will be
used to enhance beyond 6,500 MTOPS the CTP of a previously
exported or
reexported computer. BXA will not initiate the registration
of an NDAA
notice unless all information on the Multipurpose
Application form is
complete.
* * * * *
(v) Post-shipment
verification. This section outlines special post-
shipment reporting
requirements for exporters of computers with a CTP
over 2,000 MTOPS to
destinations in Computer Tier 3 under the NDAA.
These reporting
requirements also apply when you know that the items
being exported
will be used to enhance beyond 2,000 MTOPS the CTP of a
previously
exported or reexported computer. Such reports must be
submitted in
accordance with the provisions of this paragraph
(d)(5)(v), and records
of such exports subject to the post-shipment
reporting requirements of
this section, must be kept in accordance with
part 762 of the EAR.
*
* * * *
Sec. 740.11 [Amended]
8. Section 740.11 is amended by
revising the phrase ``10,000
MTOPS'' in paragraphs (a)(2)(ii) and (iii)
and in paragraph (c)(2)(i)
to read ``20,000 MTOPS''.
9. Supplement
No. 1 to section 740.11 is amended by revising the
phrase ``10,000
MTOPS'' in paragraphs (a)(1)(ii), (a)(1)(iii),
(b)(1)(ii), and
(b)(1)(iii) to read ``20,000 MTOPS''.
PART 742--[AMENDED]
10.
Section 742.12 is amended by revising the phrase ``greater
than
10,000'' in paragraph (b)(2)(i) to read ``greater than 20,000'';
by
revising the phrase ``to military end-users and end-uses and
to
nuclear, chemical, biological, or missile end-users and
end-uses
defined in part 744 of the EAR'' in paragraph (b)(3)(i)(A) to
read ``to
nuclear, chemical, biological, or missile end-users and
end-uses and
military end-users and end-uses subject to license
requirements under
Sec. 744.2, Sec. 744.3, Sec. 744.4, Sec. 744.5, and
Sec. 744.12 of the
EAR'' by revising the phrase ``to military end-users
and end-uses and
nuclear, chemical, biological, or missile end-users
and end-uses
defined in part 744 of the EAR'' in paragraph (b)(3)(ii)
to read ``to
nuclear, chemical, biological, or missile end-users and
end-uses and
military end-users and end-uses subject to license
requirements under
Sec. 744.2, Sec. 744.3, Sec. 744.4, Sec. 744.5, and
Sec. 744.12 of the
EAR''; and revising paragraphs (b)(3)(i)(B) and (C)
to read as follows:
* * * * *
Sec. 742.12 High performance
computers.
* * * * *
(b) * * *
(3) * * *
(i) * * *
(B) A
license is required to export or reexport computers with a
CTP greater
than 12,300 MTOPS for civilian end-users and end-uses in
countries in
Computer Tier 3. Prior to January 23, 2000, a license is
required to
export or reexport computers having a CTP greater than
2,000 MTOPS to
military end-users and end-uses in Computer Tier 3.
Beginning on
January 23, 2000, a license is required to export or
reexport computers
having a CTP greater than 6,500 MTOPS to military
end-users and
end-uses in Computer Tier 3.
(C) Prior to January 23, 2000, a license may be
required to export
or reexport computers with a CTP greater than 2,000
MTOPS to countries
in Computer Tier 3 pursuant to the NDAA (see Sec.
740.7(d)(5) of the
EAR). Beginning on January 23, 2000, a license may
be required to
export or reexport computers with a CTP greater than
6,500 MTOPS to
countries in Computer Tier 3 pursuant to the NDAA (see
Sec. 740.7(d)(5)
of the EAR).
* * * * *
Dated: July 27,
1999.
Iain S. Baird,
Deputy Assistant Secretary for Export
Administration.
[FR Doc. 99-19644 Filed 8-2-99; 8:45 am]
BILLING CODE
3510-33-P