Office of the Press Secretary
THE
WHITE HOUSE
July 1, 1999
FACT SHEET
Export Controls on
Computers
The President today announced
an update of U.S. export controls on computers that will promote our
national security, enhance the effectiveness of our export control system,
and ease unnecessary regulatory burdens on both government and industry.
Today's announcement is President
Clinton's third revision to U.S. export control parameters since
1993. Today's announcement reflects this Administration's efforts to
ensure effective controls on militarily sensitive technology while taking
into account the increased availability of commodity products, such as
servers and workstations, of which millions are manufactured and sold
worldwide every year.
When controls were last revised in
1995, we knew computer technology would continue to advance rapidly -- and
that we would need to update control levels periodically.
Accordingly, for the past year, the Administration has conducted a review
of our computer export controls that took into account (1) the rapid
advance of computing technology since 1995, (2) our security,
nonproliferation and other national security interests, and (3) the need
for a policy that would remain effective for at least six months.
The Administration's computer
export controls are designed to permit the government to calibrate control
levels and licensing conditions depending upon the national security or
proliferation risk posed at a specific destination, and to enhance U.S.
national security and preserve the technological lead of the U.S. computer
industrial base by ensuring controls on computer exports are effective and
do not unnecessarily impede legitimate computer exports.
This review found that advances in
the power and capabilities of widely available computing systems have more
than exceeded our 1995 control levels. In fact, during the coming
months, industry analysts estimate that systems designated as "high
performance computers" in 1995 (2,000 MTOPS (Millions of Theoretical
Operation per Second, a computer performance metric for export control
purposes)) will be available in the tens of thousands. This
reflects the exponential growth in individual microprocessor speeds that
has occurred since 1995. We fully expect this growth to continue -
U.S. companies plan commercial sales of individual "chips" rated over 2000
MTOPS by late 1999/early 2000. Moreover, while there are
military applications across a range of MTOPS levels, the national
security agencies have determined that there is no definitive line that
separates levels of computing power on the basis of their usefulness for
military applications. In light of this finding, the advances in
basic computing technologies, and the problems inherent in trying to
control commodity level items, it is clear our control limits needed to be
raised. The Administration has determined that widespread commercial
availability makes computers with a performance of 6,500 MTOPS or less
uncontrollable.
The Revised
Controls
The revised controls announced by the President
maintain the four country groups announced in 1995, but amends the
countries in, and control levels for, those groups as follows:
Tier
I (Western Europe, Japan, Canada, Mexico, Australia, New Zealand): General
license for all computers (i.e. no prior government review, but companies
must keep records on higher performance shipments that will be provided to
the U.S. government as directed).
o The President's decision today
will move Hungary, Poland, the Czech
Republic and Brazil
from Tier 2 to Tier 1. In addition, the
Administration will consider moving additional countries into Tier 1
in
the future.
Tier II (South America, South Korea,
ASEAN, Slovenia, South Africa): General license up to 10,000 MTOPS with
record-keeping and reporting as directed; individual license (requiring
prior government review) above 10,000 MTOPS.
o Today's decision
will raise the individual licensing level from 10,000
MTOPS to 20,000 MTOPS immediately. In addition, the Administration
will
review this level in six months, with the expectation
of raising it to
the 32,000-36,000 MTOPS range. The
Administration will continue to
review this level every
six months to determine if further adjustments
are
warranted.
Tier III (India, Pakistan, all Middle East/Maghreb, the
former Soviet Union, China, Vietnam, Central Europe): Current regulations
permit general license exports up to 2000 MTOPS, and require individual
licenses for military end-uses and end-users above that figure.
General license exports are permitted for civil end-users between 2000
MTOPS and 7000 MTOPS, with exporter record keeping and reporting as
directed. Individual license for all end-users above 7000
MTOPS.
o The President's decision today will maintain the current
two-level
system for civilian and military/proliferation
end-users, and will raise
the individual licensing levels
for both classes of end-users, from 2000
to 6500 MTOPS for
military end-users and from 7000 to 12,300 MTOPS for
civilian end-users. The Commerce Department will immediately raise
the
license level for civilian end-users, and will raise
the license level
for military end-users in six months, at
the same time as it adjusts the
level that triggers the
NDAA notification requirement, which is
discussed
below.
o The 1998 National Defense Authorization Act (NDAA), P.L.
105-85, imposed a
requirement for companies to provide the
Commerce Department with prior
notice of exports for
systems above 2,000 MTOPS to all Tier 3 end-users.
U.S.
export control agencies have 10 days to inform the company if it
must
apply for a license.
o The President's
decision today will raise the NDAA notification level
from
2,000 MTOPS to 6,500 MTOPS. The President has advised
the
appropriate Congressional committees of his decision
to raise the NDAA
notification level. By law,
Congress has six months to review this
decision, at which
time the change to NDAA notification level will go
into
effect (February, 2000).
o The Administration will continue to
review the licensing levels and the
NDAA notification
level every six months to determine if further
adjustments
are warranted.
Tier IV (Iraq, Iran, Libya, North Korea, Cuba,
Sudan, and Syria). There are no planned changes for Tier IV, current
policies continue to apply (i.e. the United States will maintain a virtual
embargo on computer exports).
For all these groups, reexport and
retransfer provisions continue to apply. The revised controls will become
effective when they are implemented in formal Commerce Department
regulations.
We will continue to implement the Enhanced
Proliferation Control Initiative (EPCI), which provides authority for the
government to block exports of computers of any level in cases involving
exports to end-uses or end-users of proliferation concern or risks of
diversion to proliferation activities. Criminal as well as civil penalties
apply to violators of the EPCI. In addition, the Department of Commerce
will continue to add to its list of published entities of concern as a
means of informing exporters of potential proliferation and other security
risks. The Department will remind exporters of their duty to check
suspicious circumstances and inquire about end-uses and end-users.
Exporters will be advised to contact the Department of Commerce if they
have any concern with the identity or activities of the end-users.
The Commerce Department also will
work to expand its efforts -- through public seminars and
consultations with companies -- to keep industry regularly informed
regarding problem end-users and programs of proliferation concern.
Microprocessor
Controls. In addition to revising computer export
controls, controls on general-purpose microprocessors will be revised
immediately, from the current control level of 1200 MTOPS to 1900
MTOPS. Export control agencies are in agreement that general purpose
or so-called "mass market" microprocessors are not controllable because
they are used in virtually all consumer and business personal computers,
are highly portable, and are sold in very large quantities through
multiple distribution channels worldwide. Given the continuing
increases in microprocessor technology, the Administration likely
will adjust microprocessor control levels again in the Fall,
1999. We will continue to maintain controls on higher performance,
general-purpose microprocessors that are sold in small quantities for
high-end computer and other applications, and those application-specific
microprocessors that have military applications and are sold in relatively
small quantities.
Legislative Proposal. Per
the National Defense Authorization Act of 1998, Congress requires a
six-month notice period if the President decides to raise the level that
triggers the 10-day pre-export notification requirement for Tier 3
exports. Congress also requires a four-month notice if the President
decides to move a country out of Tier 3. The six-month notice
period in particular limits our ability to respond quickly to rapid
changes in technology. We will work with Congress to change both
waiting periods to one month, in conjunction with the formal notification
to Congress of the President's decision to raise the current NDAA
notification level from 2,000 MTOPS to 6,500 MTOPS.
On a
longer-term basis, we intend to work with Congress to adopt an approach
that does not rely on ad hoc judgements about appropriate levels of
control, but rather keys our export controls to recognize the practical
impossibility of controlling items so widely available that they amount to
commodity items, like computers and microprocessors which are sold by the
hundreds of thousands and even millions.
Multilateral
Coordination: The Administration is consulting with other nations
in the context of our common controls on high performance computers, and
with the members of the Wassenaar Arrangement -- the multilateral
successor to COCOM, to ensure that they understand the basis for the
changes in controls. We are committed to working closely with them
to adjust multilateral controls to reflect technological advances and
collective security concerns. Our controls are consistent with the
basic foundations and principles of the Wassenaar Arrangement -- to deny
arms and sensitive dual-use technologies to countries of proliferation
concern, and to develop mechanisms for information sharing among the
partners as a way to harmonize our export control practices and
policies.