16 January 1998
Source: http://www.access.gpo.gov/su_docs/aces/aces140.html

See the Wassenaar Arrangement: http://jya.com/wa/watoc.htm
And the Export Administration Regulations: http://jya.com/eartoc.htm

    [Federal Register: January 15, 1998 (Volume 63, Number 10)]
    [Rules and Regulations]
    [Page 2451-2500]
    From the Federal Register Online via GPO Access [wais.access.gpo.gov]
    [DOCID:fr15ja98-12]

    [[Page 2451]]

    _______________________________________________________________________

    Part II

    Department of Commerce

    _______________________________________________________________________

    Bureau of Export Administration

    _______________________________________________________________________

    15 CFR Parts 732, 740, 742, 743, 744, 746, 762, and 774

    Implementation of the Wassenaar Arrangement List of Dual-Use Items:
    Revisions to the Commerce Control List and Reporting Under the
    Wassenaar Arrangement; Rule

    [[Page 2452]]

    DEPARTMENT OF COMMERCE

    Bureau of Export Administration

    15 CFR Parts 732, 740, 742, 743, 744, 746, 762, and 774

    [Docket No. 971006239-7239-01]
    RIN 0694-AB35

    Implementation of the Wassenaar Arrangement List of Dual-Use
    Items: Revisions to the Commerce Control List and Reporting Under the
    Wassenaar Arrangement

    AGENCY: Bureau of Export Administration, Commerce.

    ACTION: Interim rule with request for comments.

    -----------------------------------------------------------------------

    SUMMARY: Representatives of thirty-three countries gave final approval
    July 12-13, 1996 in Vienna, Austria to establish the Wassenaar
    Arrangement on Export Controls for Conventional Arms and Dual-Use Goods
    and Technologies. The thirty-three countries agreed to control all
    items in the List of Dual-Use Goods and Technologies with the objective
    of preventing unauthorized transfers. They further agreed on a target
    date of November 1, 1996, for implementation of the Wassenaar Lists.
        The purpose of this interim rule is to make the changes to the
    Commerce Control List necessary to implement the Wassenaar List. In
    addition, this interim rule imposes new reporting requirements on
    persons that export certain items controlled under the Wassenaar
    Arrangement to non-member countries in order to fulfill the information
    exchange requirements of the Wassenaar Arrangement. The Department of
    Commerce, with other concerned agencies, is reviewing the Export
    Administration Regulations to determine whether further changes will be
    required to implement the information sharing provisions of the
    Wassenaar Arrangement and to make the necessary adjustments to existing
    country groups.
        This rule also revises part 740 of the EAR by removing License
    Exception availability for certain items controlled for missile
    technology reasons.
        Although the Export Administration Act (EAA) expired on August 20,
    1994, the President invoked the International Emergency Economic Powers
    Act and continued in effect, to the extent permitted by law, the
    provisions of the EAA and the EAR in Executive Order 12924 of August
    19, 1994, as extended by the President's notices of August 15, 1995,
    August 14, 1996 and August 15, 1997.

    DATES: This rule is effective January 15, 1998. Comments on this rule
    must be received on or before February 17, 1998.

    ADDRESSES: Written comments should be sent to Patricia Muldonian,
    Regulatory Policy Division, Bureau of Export Administration, Department
    of Commerce, P.O. Box 273, Washington, DC 20044.

    FOR FURTHER INFORMATION CONTACT: James Lewis, Director, Office of
    Strategic Trade and Foreign Policy Controls, Bureau of Export
    Administration, Telephone: (202) 482-0092.

    SUPPLEMENTARY INFORMATION:

    Background

        In July 1996, the United States and thirty-two other countries gave
    final approval to the establishment of a new multilateral export
    control arrangement, called the Wassenaar Arrangement on Export
    Controls for Conventional Arms and Dual-Use Goods and Technologies
    (Wassenaar Arrangement). The Wassenaar Arrangement contributes to
    regional and international security and stability by promoting
    transparency and greater responsibility in transfers of conventional
    arms and dual-use goods and technologies, thus preventing destabilizing
    accumulations of such items. Participating states have committed to
    exchange information on exports of dual-use goods and technologies to
    non-participating states for the purposes of enhancing transparency and
    assisting in developing common understandings of the risks associated
    with the transfers of these items.
        To fulfill U.S. commitments to the Wassenaar Arrangement with
    regard to dual-use items, this rule amends the Export Administration
    Regulations (EAR) by imposing new reporting requirements for exports of
    certain items controlled under the Wassenaar Arrangement. Reports are
    not required for reexports. These new requirements appear in newly
    added part 743 of the EAR. Information from exporters will be
    consolidated by BXA for an aggregate data submission to the
    participating states.
        With respect to certain dual-use commodities, software, and
    technology, participating states have undertaken commitments to notify
    each other preferably within 30 days, but no later than 60 days, of an
    approval of a license that has been denied by another participating
    state for an essentially identical transaction during the preceding
    three years. Certain of these items are eligible for License Exceptions
    authorized by part 740 of the EAR. Therefore, in order to meet
    Wassenaar Arrangement requirements, exporters on occasion may be
    informed that the export of a certain item to a specific end-user under
    a License Exception is not authorized or alternatively, may be
    requested to provide prior written notification to BXA of an export of
    a certain item to a specific end-user under a License Exception.
        Reports are required to be submitted to BXA semiannually for
    specified items controlled under the Wassenaar Arrangement exported
    under License Exceptions LVS, GBS, CIV, CTP, TSR, and GOV. BXA must
    receive such reports no later than August 1 for exports during the
    reporting period January 1 through June 30, and no later than February
    1 for exports during the reporting period July 1 through December 31.
    The Export Control Classification Number and paragraph reference as
    identified on the Commerce Control List, number of units in each
    shipment, and the country of ultimate destination must be included in
    each report for each export during the reporting period. Although the
    exporter must be identified on all reports to BXA, names of exporters
    will not be released to participating states. Certain additional
    information requirements apply to digital computers.
        Exporters should note that the first report must be submitted to
    and received by BXA no later than August 1, 1998 for the partial
    reporting period beginning January 15, 1998 and ending June 30, 1998.
    Thereafter, reports are required semiannually according to the
    provisions of new Sec. 743.1(f) of the EAR.
        This rule also amends Sec. 742.12 of the EAR (High Performance
    Computers) to clarify the reporting and recordkeeping requirements for
    certain computer and software exports.
        This rule also amends part 740 of the EAR by adding appropriate
    cross-references to reporting requirements under License Exceptions
    LVS, GBS, CIV, TSR, CTP, and GOV. The major changes in the Commerce
    Control List (CCL) necessary to implement the Wassenaar Arrangement are
    summarized below.
        In addition, based on interagency agreement, particularly
    consultations with the Department of State, this rule revises part 740
    of the EAR by removing License Exception availability for missile
    technology (MT) controlled items, except that items described in ECCNs
    6A008, 7A001, 7A002, 7A004, 7A101, 7A102, 7A103, 7A104, 7D001, 7D002,
    7D003, 7D101, 7D102, 7E003, or 7E101, may be exported as part of a
    manned aircraft, satellite, land vehicle, or marine vehicle or in
    quantities

    [[Page 2453]]

    appropriate for replacement parts under License Exceptions TMP, RPL,
    TSU, or AVS. This action is based on a U.S. Government policy to
    restrict the proliferation of missile capability and is consistent with
    the Missile Technology Control Regime (MTCR) multilateral guidelines.
        Also, in an effort to comply with our international commitments of
    the Wassenaar Arrangement, the U.S. has also committed to exercise
    extreme vigilance for certain items controlled for national security
    reasons (NS), which are considered most critical to military
    applications. This rule removes License Exception eligibility for
    License Exceptions LVS, CIV, TSR, and GOV for certain commodities,
    technologies, and software controlled for national security reasons for
    which the U.S. has agreed to license with extreme vigilance.

    Category 1--Materials

        Additional controls have been added for body armor (1A005), certain
    fluorocarbon electronic cooling fluids (1C006), certain ``ceramic-
    ceramic'' materials with oxide or glass matrix (1C007), certain metals
    and compounds (1C011), and certain material for nuclear heat sources.
    In addition, controls for ``stress'' limits for metal alloys (1C002),
    have been modified. Additional clarification of controls are specific
    for the transition temperature limits on certain ``fibrous or
    filamentary materials'' (1C010)

    Category 2--Material Processing

        A significant number of changes have been implemented for machine
    tools. Specifically, the machine tool entry has been modified to
    separate the controls on turning, milling and grinding machines. In
    particular, such machines will no longer be controlled under the
    Wassenaar Arrangement on the basis of ``tilting spindles'',
    ``camming'', or ``run-out''. Also, detailed test procedures, as
    specified by the International Standards Organization (ISO), will no
    longer be reiterated in the list. This revision will allow the
    regulations to remain effective while keeping the procedures under
    which the equipment is measured, current with industry practice. In
    addition, controls have been removed for ``numerical control'' units
    and ``motion control boards'', wire feed type electrical discharge
    machines (2B001), manual machines specially designed for bevel gears
    (2B003), systems for inspection of hemishells (2B006), and software for
    ``flexible manufacturing units'' (2D002). Two additional items have
    been added under 2B001. They include ``specialty machines'' (i.e. deep
    hole drilling machines) and spin-forming/flow-forming machines. Lastly,
    controls on spindle assemblies and slide assemblies have been moved
    from 2B008 to 2B992 as specially designed components therefore.

    Category 3--Electronics

        A number of controls have been removed for components under
    Category 3, including microprocessors up to a composite theoretical
    performance (CTP) value of 260 Mtops, most storage devices (i.e. memory
    circuits), and on custom integrated circuits (3A001). In addition, the
    frequency parameter for network analyzers and microwave test receivers
    have been relaxed, and controls on emulators (3A002) have been removed
    entirely. The most significant change is in the entries under Category
    3B dealing with semiconductor manufacturing equipment. Specifically,
    these entries have been combined and divided into two ECCNs. In
    addition, the limit for control of integrated circuits testers have
    been raised from 50 MHZ to 60 MHZ (3B002).

    Category 4--Computers

        Under category 4, the CTP value for computers has been raised from
    260 Mtops to 2,000 Mtops. The limit on graphic accelerators and
    graphics coprocessors has been relaxed to a 3-D vector rate of
    3,000,000 (4A003). The technology for ``multi-data-stream processing''
    has been revised to the control level defined in 4A003.b. (4E002). The
    technology for magnetic hard disk drives (4E002) has been removed.

    Category 5--Telecommunications, Part I

        Several sections of Part I, Telecommunication have been removed
    creating a significant number of changes to the controls on
    telecommunication equipment. The majority of changes are identified in
    the following entries.
        All controls on telecommunication transmission equipment or
    systems, having digital cross connect equipment and modems (5A001.b.),
    have been removed. In addition, controls have been removed on certain
    communication channel controllers, certain network access controllers,
    certain radio equipment operating at frequencies of 31 GHz or less, and
    certain digital signal processing equipment based upon ``user-
    accessible programmability'' by raising the control parameters in each
    instance (5A001.b.).
        Also, controls have been removed on ``stored program controlled''
    switching equipment containing any of the following characteristics,
    functions or features (5A001.c.):

    --``Integrated Services Digital Network'' (ISDN) functions;
    --Multi-level priority and pre-emption for circuit switching;
    --Routing or switching of ``datagram'' packets;
    --Routing for switching of fast select packets;
    --Automatic hand-off of cellular radio calls; and
    --Digital cross connect equipment.

        Additionally, the control parameters for the ``data signaling
    rate'' for ``communications channel controllers'' and the digital
    transfer rate for ``network access controllers'' have been modified to
    relax controls on packet switches, circuit switches and routers.
    Controls on all general purpose test equipment (e.g. bit error rate
    testers and protocol analyzers) have been removed (5B001). Controls on
    software for use of digital switching equipment (5D001) have been
    removed and controls on development technology for spread spectrum and
    frequency hopping techniques (5E001.b.) have been added.

    Category 5--``Information Security'', Part II

        Under Part II, ``Information Security'', certain items have been
    decontrolled through an expansion of ``Notes'' within the entry of
    5A002. These notes state that certain access control equipment (e.g.
    equipment to protect personal identification numbers [PIN]), data
    authentication equipment (e.g. equipment which calculates a Message
    Authentication Code [MAC]) and cryptographic equipment specially
    designed and limited for use in machines for banking or money
    transactions are not controlled. In addition, all software for virus
    protection (5D002) has been removed.

    Category 6--Sensors and Lasers

        Under the acoustics section, controls for certain wide-swath
    bathymetric survey systems and terrestrial geophones have been removed.
    In addition, controls for towed acoustic hydrophone arrays and
    processing equipment for hydrophone arrays have been modified. Controls
    for bottom or bay cable systems (6A001) have been added. Under optical
    sensors, controls for specially designed components of image
    intensifier tubes (6A002) have been modified. Controls for monospectral
    imaging sensors have been added. Under optics, controls on certain
    optical filters and ``fluoride fiber'' cable (6A004) have been removed.
    Under lasers, certain carbon dioxide lasers, semiconductor lasers, ruby
    lasers, neodymium doped lasers and free electron lasers (6A005) have

    [[Page 2454]]

    been removed. Under radar, weather balloon tracking radars (6A008) have
    been removed. For production equipment, equipment for test, inspection
    and production of lasers (6B005) have been removed. In addition,
    controls on materials for optical fiber preforms for the manufacture of
    high birefringence fibers (6C002), materials for certain low optical
    absorption materials, and materials for optical fiber preforms for the
    manufacture of fluoride fibers (6C004) have been removed. Controls on
    software specially designed for bottom or bay cables have been added
    and controls on certain primary radar target data software (6D003) have
    been removed. Finally, controls for certain optical fabrication
    technology and technology for certain optical fibers (6E003) have been
    removed.

    Category 7--Navigation and Avionics

        Controls on inertial navigation systems certified for use on
    ``civil aircraft'' (7A003) have been removed. Also, controls for
    direction finder equipment (7A007), computer aided design (CAD)
    software (7D003), and technology for electric actuators for primary
    flight control and flight control optical sensor arrays (7E004) have
    been added.

    Category 8--Marine

        Controls for certain underwater vision systems, certain
    photographic still cameras and certain light systems (8A002) have been
    relaxed. Controls on stirling cycle engine air independent power
    systems (8A002) have been clarified.

    Category 9--Propulsion

        Under the section dealing with Test, Inspection and Production
    Equipment, several items have been removed, including automated
    equipment for measuring airfoil wall thickness, tooling/fixtures, and
    measuring equipment for hole drilling processing, ceramic core leaching
    equipment and ceramic shell burn out or firing equipment (9B001).
    Controls on brush seals have been narrowed by adding a control for a
    temperature limit (9B003) and expanded by adding tools, dies or
    fixtures for solid state joining of intermetallic airfoil-to-disk
    combinations for gas turbine engines (9B004). Transducers/strain
    gauges/accelerometers/thermocouples for vibration equipment (9B006)
    have also been removed. Accordingly, under software, controls for
    certain software for vibration test equipment as well as certain
    development/production software of test facilities for engines (9D004)
    have been removed. Finally, a few modifications have been made under
    technology for gas turbine engine components or systems and controls on
    helicopter power transfer systems or tilt rotor or tilt wing aircraft
    (9E003). Specifically, controls have been narrowed on technology for
    multiple domed combustors (9E003.a.2), the technology for gas bearing
    for gas turbine engine rotor assemblies (9E003.a.12), and the
    technology for helicopter, tilt rotor or tilt wing aircraft power
    transfer systems.

        All items removed from national security (NS) controls as a result
    of the Wassenaar List of Dual-Use Goods and Technologies will continue
    to be controlled for antiterrorism (AT) reasons.
        Numerous entries that are contained on the Wassenaar List of Dual-
    Use Goods and Technologies are subject to the export licensing
    authority of the Office of Defense Trade Controls, Department of State.
    This rule will list all entries that are controlled on the Wassenaar
    List of Dual-Use Goods and Technologies, but will specify that those
    entries are under the licensing authority of the Office of Defense
    Trade Controls, Department of State.
        On March 25, 1996 (61 FR 12714), BXA revised the Commerce Control
    List by adopting the European Union (EU) numbering system and converted
    our former ECCNs to correspond accordingly. The changes adopted by this
    rule attempts to further harmonize the CCL with the EU List. This
    ensures that identical ECCNs on the CCL and the EU List will identify
    the same item(s). From an enforcement or customs perspective, this
    common numbering system simplifies export controls for all countries
    that harmonize to this control list. As a result of this harmonization
    exercise, it was discovered that certain differences exist between the
    EU List and the CCL and among agencies within the U.S., in terms of
    MTCR related controls. These differences predominately exist in the
    area of technology and software controls. For most of the entries, the
    EU text was adopted or modified to ensure that it comported to the
    intent of the MTCR Annex. For those technology and software entries
    where differences could not be resolved at the interagency level, it
    was agreed to maintain the control text for those entries as published
    in the March 25 rule, until these differences are resolved.
        To ensure that no overlap in controls exists among the regimes and
    that the Wassenaar Arrangement list did not decontrol items that are
    currently controlled on the MTCR Annex, references to certain missile
    technology controlled entries were included and clarification notes
    were added to aid the exporter.
        In addition, this rule will include ECCN entries for those MTCR
    items that are under the licensing authority of the Department of
    State, Office of Defense Trade Controls. Those items are specifically
    listed on the CCL to inform the exporter that the corresponding EU list
    entry for such items are under the licensing authority of the
    Department of State, Office of Defense Trade Controls.
        BXA is continuing a comprehensive review of the Commerce Control
    List (CCL) to account for items controlled by the Nuclear Suppliers
    Group (NSG), the Missile Technology Control Regime (MTCR), and the
    Australia Group (AG) and to correct errors published on March 25, 1996,
    and unavoidably reprinted in this version of the CCL. The review will
    be based in large part upon the comments received in response to the
    March 25 rule and upon ongoing efforts to harmonize the CCL with the
    EU's control list.

    Saving Clause

        This rule revises the numbering and structure of certain entries on
    the Commerce Control List. For items under such entries and for April
    15, 1998, BXA will accept license applications for items described
    either by the entries in effect immediately before January 15, 1998 or
    the entries described in this rule. In addition, shipments of items
    removed from eligibility for export or reexport under a particular
    License Exception authorization or the designator NLR, as a result of
    this regulatory action, may continue to be exported or reexported under
    that License Exception authorization or designator until February 17,
    1998.

    Rulemaking Requirements

        1. This interim 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 shall any person be subject to a penalty
    for failure to comply with a collection of information, subject to the
    requirements of the Paperwork Reduction Act (PRA), unless that
    collection of information displays a currently valid OMB Control
    Number. This rule involves collections of information subject to the
    Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) These
    collections has been approved by the Office of Management and Budget
    under control numbers 0694-0073, 0694-0086, and 0694-0088. This rule
    also contains a new collection-of-information requirement subject to

    [[Page 2455]]

    the PRA that has received emergency approval under OMB control number
    0694-xxxx. The new information requirement and estimated public burden
    hours include: recording responses (5 minutes each); filing responses
    (1 minute each); and transmitting responses to BXA (10 minutes per
    exporter). These estimates include the time for reviewing instructions,
    searching existing data sources, gathering and maintaining the data
    needed, and completing and reviewing the collections of information.
    Send comments regarding these burden estimates or any other aspect of
    these collections of information, including suggestions for reducing
    the burden, to OMB Desk Officer, New Executive Office Building,
    Washington, DC 20503.
        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 (5 U.S.C.
    553) requiring notice of proposed rulemaking, the opportunity for
    public participation, and a delay in effective date, are inapplicable
    because this regulation involves a military and foreign affairs
    function of the United States (Sec. 5 U.S.C. 553(a)(1)). Further, no
    other law requires that a notice of proposed rulemaking and an
    opportunity for public comment be given for this interim rule. Because
    a notice of proposed rulemaking and an opportunity for public comment
    are not required to be given for this rule under 5 U.S.C. or by any
    other law, the analytical requirements of the Regulatory Flexibility
    Act (5 U.S.C. 601 et seq.) are not applicable.
        However, because of the importance of the issues raised by these
    regulations, this rule is issued in interim form and comments will be
    considered in the development of final regulations.
        Accordingly, the Department encourages interested persons who wish
    to comment to do so at the earliest possible time to permit the fullest
    consideration of their views.
        The period for submission of comments will close February 17, 1998.
    The Department will consider all comments received before the close of
    the comment period in developing final regulations. Comments received
    after the end of the comment period will be considered if possible, but
    their consideration cannot be assured. The Department will not accept
    public comments accompanied by a request that a part or all of the
    material be treated confidentially because of its business proprietary
    nature or for any other reason. The Department will return such
    comments and materials to the person submitting the comments and will
    not consider them in the development of final regulations. All public
    comments on these regulations will be a matter of public record and
    will be available for public inspection and copying. In the interest of
    accuracy and completeness, the Department requires comments in written
    form.
        Oral comments must be followed by written memoranda, which will
    also be a matter of public record and will be available for public
    review and copying. Communications from agencies of the United States
    Government or foreign governments will not be made available for public
    inspection.
        The public record concerning these regulations will be maintained
    in the Bureau of Export Administration Freedom of Information Records
    Inspection Facility, Room 4525, Department of Commerce, 14th Street and
    Pennsylvania Avenue, N.W., Washington, D.C. 20230. Records in this
    facility, including written public comments and memoranda summarizing
    the substance of oral communications, may be inspected and copied in
    accordance with regulations published in Part 4 of Title 15 of the Code
    of Federal Regulations. Information about the inspection and copying of
    records at the facility may be obtained from Margaret Cornejo, Bureau
    of Export Administration Freedom of Information Officer, at the above
    address or by calling (202) 482-5653.

    List of Subjects

    15 CFR Part 732

        Administrative practice and procedure, Exports, Foreign trade,
    Reporting and recordkeeping requirements.

    15 CFR Part 740

        Administrative practice and procedure, Exports, Foreign trade,
    Reporting and recordkeeping requirements.

    15 CFR Part 742

        Exports, Foreign Trade.

    15 CFR Part 743

        Administrative practice and procedure, Exports, Foreign trade,
    Reporting and recordkeeping requirements.

    15 CFR Part 744

        Exports, Foreign Trade, Reporting and recordkeeping requirements.

    15 CFR Part 746

        Embargoes, Exports, Foreign Trade, Reporting and recordkeeping
    requirements.

    15 CFR Part 762

        Administrative practice and procedure, Business and Industry,
    Exports, Foreign trade, Reporting and recordkeeping requirements.

    15 CFR Part 774

        Exports, Foreign Trade.

        Accordingly, parts 732, 740, 742, 744, 746, 762, and 774 of the
    Export Administration Regulations (15 CFR parts 730 through 799) are
    amended as follows:
        1. The authority citation for parts 732 and 762 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, 3
    CFR, 1995 Comp., p. 228; Notice of August 15, 1995, 3 CFR, 1995
    Comp., p. 501; Notice of August 14, 1996, 3 CFR, 1996 Comp., p. 298;
    and Notice of August 13, 1997 (62 FR 43629, August 15, 1997).

        2. The authority citation for 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; Notice of August
    15, 1995, 3 CFR, 1995 Comp., p. 501; Notice of August 14, 1996, 3
    CFR, 1996 Comp., p. 289; and Notice of August 13, 1997 (62 FR 43629,
    August 15, 1997).

        3. The authority citation for 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, 58
    FR 33181, 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, 1995 Comp., p.
    950; Notice of August 15, 1995, 3 CFR, 1995 Comp., p. 501; Notice of
    August 14, 1996, 3 CFR, 1996 Comp., p. 289; and Notice of August 13,
    1997 (62 FR 43629, August 15, 1997).

        4-5. The authority citation for part 744 is revised to read as
    follows:

        Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C 1701 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, 58 FR 33181, 3 CFR, 1993 Comp.,
    p. 608; E.O. 12924, 59 FR 43437, 3 CFR, 1994 Comp., p. 915; E.O.
    12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; Notice of August 14,
    1996, 3 CFR, 1996 Comp., p. 298; and Notice of August 13, 1997 (62
    FR 43629, August 15, 1997).

        6. The authority citation for part 746 is revised to read as
    follows:

        Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;
    22 U.S.C. 287c; 22 U.S.C. 6004; E.O. 12918, 59 FR 28205, 3 CFR, 1994

    [[Page 2456]]

    Comp., p. 899; E.O. 12924, 59 FR 43437, 3 CFR, 1994 Comp., p. 917;
    Notice of August 14, 1996, 3 CFR, 1996 Comp., p. 298; and Notice of
    August 13, 1997 (62 FR 43629, August 15, 1997).

        7. The authority citation for part 774 continues to read as
    follows:

        Authority: 50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.;
    10 U.S.C. 720; 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; Sec. 201, Pub. L. 104-
    58, 109 Stat. 557 (30 U.S.C. 185(s)); 30 U.S.C. 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;
    Notice of August 15, 1995, 3 CFR, 1995 Comp., p. 501; Notice of
    August 14, 1996, 3 CFR, 1996 Comp., p. 298; and Notice of August 13,
    1997 (62 FR 43629, August 15, 1997).

    PART 732--[AMENDED]

        8. Section 732.4 of the EAR is amended by adding a new paragraph
    (b)(3)(iv) to read as follows:

    Sec. 732.4  Steps regarding License Exceptions.

    * * * * *
        (b) * * *
        (3) * * *
        (iv) If you are exporting under License Exceptions GBS, CIV, LVS,
    CTP, TSR, or GOV, you should review Sec. 743.1 of the EAR to determine
    the applicability of certain reporting requirements.
    * * * * *

    PART 740--[AMENDED]

        9. Section 740.2 is amended:
        a. By adding a new paragraph (a)(5); and
        b. By adding a new paragraph (c) to read as follows:

    Sec. 740.2  Restrictions on all License Exceptions.

        (a) * * *
        (5) The item is controlled for missile technology (MT) reasons,
    except that the items described in ECCNs 6A008, 7A001, 7A002, 7A004,
    7A101, 7A102, 7A103, 7A104, 7B001, 7D001, 7D002, 7D003, 7D101, 7D102,
    7E003, or 7E101, may be exported as part of a manned aircraft,
    satellite, land vehicle or marine vehicle or in quantities appropriate
    for replacement parts for such applications under Sec. 740.9(a)(2)(ii)
    (License Exception TMP for kits consisting of replacement parts),
    Sec. 740.10 (License Exception RPL), Sec. 740.13 (License Exception
    TSU), or Sec. 740.15(c) (License Exception AVS for equipment and spare
    parts for permanent use on a vessel or aircraft).
    * * * * *
        (c) BXA may by informing the exporter, suspend or revoke any
    License Exception in order to comply with U.S. Wassenaar obligations.
    In addition, BXA may inform an exporter, that before using any License
    Exception, a notice be submitted with BXA concerning the proposed
    export.
        10. Section 740.3 is amended by adding a new paragraph (f) to read
    as follows:

    Sec. 740.3  Shipments of Limited Value (LVS).

    * * * * *
        (f) Reporting requirements. See Sec. 743.1 of the EAR for reporting
    requirements for exports of certain commodities under License Exception
    LVS.
        11. Section 740.4 is revised to read as follows:

    Sec. 740.4  Shipments to Country Group B countries (GBS).

        License Exception GBS authorizes exports and reexports to Country
    Group B (see Supplement No. 1 to part 740) of those commodities
    controlled to the ultimate destination for national security reasons
    only and identified by ``GBS--Yes'' on the CCL. See Sec. 743.1 of the
    EAR for reporting requirements for exports of certain commodities under
    License Exception GBS.
        12. Section 740.5 is amended by adding a new sentence at the end to
    read as follows:

    Sec. 740.5  Civil end-users (CIV).

        * * * See Sec. 743.1 of the EAR for reporting requirements for
    exports of certain commodities under License Exception CIV.
        13. Section 740.6 is amended by adding paragraph (b) to read as
    follows:

    Sec. 740.6  Technology and software under restriction (TSR).

    * * * * *
        (b) Reporting requirements. See Sec. 743.1 of the EAR for reporting
    requirements for exports of certain commodities under License Exception
    TSR.
        14. Section 740.7 is amended by revising paragraph (f) to read as
    follows:

    Sec. 740.7  Computers (CTP).

    * * * * *
        (f) Reporting requirements. See Sec. 743.1 of the EAR for reporting
    requirements for exports of certain commodities under License Exception
    CTP.
        15. Section 740.11 is amended:
        a. By revising paragraph (a)(2);
        b. By revising paragraph (b)(2)(iii);
        c. By revising paragraph (b)(2)(iv), and
        d. By adding a new Supplement No. 1, as follows:

    Sec. 740.11  Governments and international organizations (GOV).

    * * * * *
        (a) * * *
        (2) The following items controlled for national security (NS)
    reasons under Export Control Classification Numbers (ECCNs) identified
    on the Commerce Control List may not be exported or reexported under
    this License Exception to destinations other than Austria, Belgium,
    Canada, Denmark, Finland, France, Germany, Greece, Ireland, Italy,
    Luxembourg, the Netherlands, Portugal, Spain, Sweden, and the United
    Kingdom: 1C001, 1C012, 5A001.b.9, 6A001.a.2.a.1, 6A001.a.2.a.2,
    6A001.a.2.a.7, 6A001.a.2.b, 6A001.a.2.e.1, 6A001.a.2.e.2, 6A002.a.1.c,
    6A008.l.3., 6B008, 8A001.b., 8A001.d., 8A002.o.3.b., 9A011; and
        (i) ``Composite'' structures or laminates controlled by 1A002.a.,
    having an organic ``matrix'' and made from materials listed under
    1C010.c. or 1C010.d.; and
        (ii) ``Digital'' computers controlled by 4A003.b. and having a CTP
    exceeding 10,000 MTOPS; and
        (iii) ``Electronic assemblies'' controlled by 4A003.c. and capable
    of enhancing performance by aggregation of ``computing elements'' so
    that the CTP of the aggregation exceeds 10,000 MTOPS; and
        (iv) Processing equipment controlled by 6A001.a.2.c. and specially
    designed for real time application with towed acoustic hydrophone
    arrays; and
        (v) Bottom or bay cable systems controlled by 6A001.a.2.e.3 and
    having processing equipment specially designed for real time
    application with bottom or bay cable systems; and
        (vi) ``Software'', as follows:
        (A) Controlled by 4D001, specially designed for the ``development''
    or ``production'' for items controlled by 4A003.b or .c, as defined by
    paragraphs (a)(2)(ii) and (iii) of this section; and
        (B) Controlled by 5D001.a, specially designed for items controlled
    by 5A001.b.9; and
        (C) Controlled by 6D001 for items controlled by 6A008.l.3 or 6B008;
    and
        (D) Controlled by 6D003.a; and
        (E) Controlled by 7D003.a or 7D003.b; and
        (F) Controlled by 8D001, specially designed for the ``development''
    or ``production'' of equipment controlled by 8A001.b, 8A001.d, or
    8A002.o.3.b; and
        (G) Controlled by 9D001, specially designed for the ``development''
    of equipment or ``technology'' controlled by 9A011, 9E003.a.1, or by
    9E003.a.3, for items controlled by 1A002.a, as

    [[Page 2457]]

    described in paragraph (a)(2)(i) of this section; and
        (H) Controlled by 9D002 for ``software'' specially designed for the
    ``production'' of equipment controlled by 9A011; and
        (I) Controlled by 9D004.a or .c.
        (b) * * *
        (2) * * *
        (iii) (A) Items for official use within national territory by
    agencies of the U.S. Government. This License Exception is available
    for all items consigned to and for the official use of any agency of a
    cooperating government within the territory of any cooperating
    government, except items described in paragraph (a) to Supplement No. 1
    of this section:
        (B) Reporting requirements. See Sec. 743.1 of the EAR for reporting
    requirements for exports of certain items under this paragraph
    (b)(2)(iii).
        (iv) (A) Diplomatic and consular missions of a cooperating
    government. This License Exception is available for all items consigned
    to and for the official use of a diplomatic or consular mission of a
    cooperating government located in any country in Country Group B (see
    Supplement No. 1 to part 740), except items described in paragraph (b)
    of Supplement No. 1 of this section.
        (B) Reporting requirements. See Sec. 743.1 of the EAR for reporting
    requirements for exports of certain items under this paragraph
    (b)(2)(iv).
    * * * * *

    Supplement No. 1 to Sec. 740.11--Additional Restrictions on Use of
    License Exception GOV

        (a) Items for official use within national territory by agencies
    of the U.S. Government. License Exception GOV is available for all
    items consigned to and for the official use of any agency of a
    cooperating government within the territory of any cooperating
    government, except:
        (1) Items identified on the Commerce Control List as controlled
    for national security (NS) reasons under Export Control
    Classification Numbers (ECCNs) as follows for export or reexport to
    destinations other than Austria, Belgium, Canada, Denmark, Finland,
    France, Germany, Greece, Ireland, Italy, Luxembourg, the
    Netherlands, Portugal, Spain, Sweden, or the United Kingdom: 1C001,
    1C012, 5A001.b.9, 6A001.a.2.a.1, 6A001.a.2.a.2, 6A001.a.2.a.7,
    6A001.a.2.b, 6A001.a.2.e.1, 6A001.a.2.e.2, 6A002.a.1.c, 6A008.l.3.,
    6B008, 8A001.b., 8A001.d., 8A002.o.3.b., 9A011; and
        (i) ``Composite'' structures or laminates controlled by
    1A002.a., having an organic ``matrix'' and made from materials
    listed under 1C010.c. or 1C010.d.; and
        (ii) ``Digital'' computers controlled by 4A003.b. and having a
    CTP exceeding 10,000 MTOPS; and
        (iii) ``Electronic assemblies'' controlled by 4A003.c. and
    capable of enhancing performance by aggregation of ``computing
    elements'' so that the CTP of the aggregation exceeds 10,000 MTOPS;
    and
        (iv) Processing equipment controlled by 6A001.a.2.c. and
    specially designed for real time application with towed acoustic
    hydrophone arrays; and
        (v) Bottom or bay cable systems controlled by 6A001.a.2.e.3 and
    having processing equipment specially designed for real time
    application with bottom or bay cable systems;
        (vi) ``Software'', as follows:
        (A) Controlled by 4D001, specially designed for the
    ``development'' or ``production'' for items controlled by 4A003.b or
    .c, as defined by paragraphs (a)(1)(ii) and (iii) of this
    Supplement; and
        (B) Controlled by 5D001.a, specially designed for items
    controlled by 5A001.b.9; and
        (C) Controlled by 6D001 for items controlled by 6A008.l.3 or
    6B008; and
        (D) Controlled by 6D003.a; and
        (E) Controlled by 7D003.a or 7D003.b; and
        (F) Controlled by 8D001, specially designed for the
    ``development'' or ``production'' of equipment controlled by
    8A001.b, 8A001.d, or 8A002.o.3.b; and
        (G) Controlled by 9D001, specially designed for the
    ``development'' of equipment or ``technology'' controlled by 9A011,
    9E003.a.1, or by 9E003.a.3, for items controlled by 1A002.a, as
    described in paragraph (a)(1)(i) of this Supplement; and
        (H) Controlled by 9D002 for ``software'' specially designed for
    the ``production'' of equipment controlled by 9A011; and
        (I) Controlled by 9D004.a or .c.
        (vii) ``Technology'', as follows:
        (A) Controlled by 5E001.a for items controlled by 5A001.b.9 or
    5D001.a; and
        (B) Controlled by 1E001 for items controlled by 1A002.a, 1C001,
    or 1C102 as described by paragraph (a)(1)(i) of this Supplement; and
        (C) Controlled by 6E001 for the ``development'' of equipment or
    ``software'' in 6A001.a.2.a.1, 6A001.a.2.a.2, 6A001.a.2.a.7,
    6A001.a.2.b, 6A001.a.2.c, 6A001.a.2.3, 6A002.a.1.c, 6A008.l.3, or
    6B008, as described in paragraph (a)(1) of this Supplement; and
        (D) Controlled by 6E002 for the ``production'' of equipment
    controlled by 6A001.a.2.a.1, 6A001.a.2.a.2, 6A001.a.2.a.7,
    6A001.a.2.b, 6A001.a.2.c, 6A001.a.2.3, 6A002.a.1.c, 6A008.l.3, or
    6B008, as described in paragraph (a)(1) of this Supplement; and
        (E) Controlled by 8E001 for items controlled by 8A001.b,
    8A002.o.3.b, or 8A001.d; and
        (F) Controlled by 9E001 for items controlled by 9A011, 9D001, or
    9D002; and
        (G) Controlled by 9E002 for items controlled by 9A011; and
        (H) Controlled by 9E003.a.1; and
        (I) Controlled by 9E003.a.3 for items controlled by 1A002.a as
    described in paragraph (a)(1) of this Supplement.
        (2) Items identified on the Commerce Control List as controlled
    for missile technology (MT), chemical and biological warfare (CB),
    or nuclear nonproliferation (NP) reasons;
        (3) Regional stability items controlled under Export Control
    Classification Numbers (ECCNs) 6A002, 6A003, 6E001, 6E002, 7D001,
    7E001, 7E002, and 7E101 as described in Sec. 742.6(a)(1) of the EAR;
    or
        (4) Encryption items controlled for EI reasons as described in
    the Commerce Control List.
        (b) Diplomatic and consular missions of a cooperating
    government. License Exception GOV is available for all items
    consigned to and for the official use of a diplomatic or consular
    mission of a cooperating government located in any country in
    Country Group B (see Supplement No. 1 to part 740), except:
        (1) Items identified on the Commerce Control List as controlled
    for national security (NS) reasons under Export Control
    Classification Numbers (ECCNs) as follows for export or reexport to
    destinations other than Austria, Belgium, Canada, Denmark, Finland,
    France, Germany, Greece, Ireland, Italy, Luxembourg, the
    Netherlands, Portugal, Spain, Sweden, or the United Kingdom: 1C001,
    1C012, 5A001.b.9, 6A001.a.2.a.1, 6A001.a.2.a.2, 6A001.a.2.a.7,
    6A001.a.2.b, 6A001.a.2.e.1, 6A001.a.2.e.2, 6A002.a.1.c, 6A008.l.3.,
    6B008, 8A001.b., 8A001.d., 8A002.o.3.b., 9A011; and
        (i) ``Composite'' structures or laminates controlled by
    1A002.a., having an organic ``matrix'' and made from materials
    listed under 1C010.c. or 1C010.d.; and
        (ii) ``Digital'' computers controlled by 4A003.b. and having a
    CTP exceeding 10,000 MTOPS; and
        (iii) ``Electronic assemblies'' controlled by 4A003.c. and
    capable of enhancing performance by aggregation of ``computing
    elements'' so that the CTP of the aggregation exceeds 10,000 MTOPS;
    and
        (iv) Processing equipment controlled by 6A001.a.2.c. and
    specially designed for real time application with towed acoustic
    hydrophone arrays; and
        (v) Bottom or bay cable systems controlled by 6A001.a.2.e.3 and
    having processing equipment specially designed for real time
    application with bottom or bay cable systems;
        (vi) ``Software'', as follows:
        (A) Controlled by 4D001, specially designed for the
    ``development'' or ``production'' for items controlled by 4A003 .b
    or .c, as defined by paragraphs (b)(1) (ii) or (iii) of this
    Supplement; and
        (B) Controlled by 5D001.a, specially designed for items
    controlled by 5A001.b.9; and
        (C) Controlled by 6D001 for items controlled by 6A008.l.3 or
    6B008; and
        (D) Controlled by 6D003.a; and
        (E) Controlled by 7D003.a or 7D003.b; and
        (F) Controlled by 8D001, specially designed for the
    ``development'' or ``production'' of equipment controlled by
    8A001.b, 8A001.d, or 8A002.o.3.b; and
        (G) Controlled by 9D001, specially designed for the
    ``development'' of equipment or ``technology'' controlled by 9A011,
    9E003.a.1, or by 9E003.a.3, for items controlled by 1A002.a, as
    described in paragraph (b)(1)(i) of this Supplement; and
        (H) Controlled by 9D002 for ``software'' specially designed for
    the ``production'' of equipment controlled by 9A011; and

    [[Page 2458]]

        (I) Controlled by 9D004 .a or .c.
        (vii) ``Technology'', as follows:
        (A) Controlled by 5E001.a for items controlled by 5A001.b.9 or
    5D001.a; and
        (B) Controlled by 1E001 for items controlled by 1A002.a, 1C001,
    or 1C102 as described by paragraph (b)(1) of this Supplement; and
        (C) Controlled by 6E001 for the ``development'' of equipment or
    ``software'' in 6A001.a.2.a.1, 6A001.a.2.a.2, 6A001.a.2.a.7,
    6A001.a.2.b, 6A001.a.2.c, 6A001.a.2.3, 6A002.a.1.c, 6A008.l.3, or
    6B008, as described in paragraph (b)(1) of this Supplement; and
        (D) Controlled by 6E002 for the ``production'' of equipment
    controlled by 6A001.a.2.a.1, 6A001.a.2.a.2, 6A001.a.2.a.7,
    6A001.a.2.b, 6A001.a.2.c, 6A001.a.2.3, 6A002.a.1.c, 6A008.l.3, or
    6B008, as described in paragraph (b)(1) of this Supplement; and
        (E) Controlled by 8E001 for items controlled by 8A001.b,
    8A002.o.3.b, or 8A001.d; and
        (F) Controlled by 9E001 for items controlled by 9A011, 9D001, or
    9D002; and
        (G) Controlled by 9E002 for items controlled by 9A011; and
        (H) Controlled by 9E003.a.1; and
        (I) Controlled by 9E003.a.3 for items controlled by 1A002.a as
    described in paragraph (b)(1)(i) of this Supplement.
        (2) Items identified on the Commerce Control List as controlled
    for missile technology (MT), chemical and biological warfare (CB),
    or nuclear nonproliferation (NP) reasons;
        (3) Regional stability items controlled under Export Control
    Classification Numbers (ECCNs) 6A002, 6A003, 6E001, 6E002, 7D001,
    7E001, 7E002, and 7E101 as described in Sec. 742.6(a)(1) of the EAR;
    or
        (4) Encryption items controlled for EI reasons as described in
    the Commerce Control List.

    PART 742--[AMENDED]

        16. Section 742.6(a)(1) is amended:
        a. By removing the phrase ``6D102 (only software for development of
    items in 6A002.a.1, a.2, a.3, or .c);'' and
        b. By revising the phrase ``7E002 (only technology for the
    production of inertial navigation systems, inertial equipment, and
    specially designed components therefor for civil aircraft).'' to read
    ``7E002 (only technology for the production of inertial navigation
    systems, inertial equipment, and specially designed components therefor
    for civil aircraft); 7E101 (only technology for the use of inertial
    navigation systems, inertial equipment, and specially designed
    components for civil aircraft).''
        17. Section 742.12 is amended by revising paragraph (a)(3) and by
    removing paragraph (a)(4) to read as follows:

    Sec. 742.12  High performance computers.

        (a) * * *
        (3) Exporters must keep accurate records of each export to
    countries not included in Country Group A:1 (see Supplement No. 1 to
    part 740 of the EAR) of a computer with a CTP greater than 4,000 MTOPS.
    These records must be submitted semiannually to BXA and must contain
    the information as described in Sec. 743.1 of the EAR.
    * * * * *
        18. A new part 743 is added to read as follows:

    PART 743--SPECIAL REPORTING

        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; Notice of August
    15, 1995, 3 CFR, 1995 Comp., p. 501; Notice of August 14, 1996, 3
    CFR, 1996 Comp., p. 289; and Notice of August 13, 1997 (62 FR 43629,
    August 15, 1997).

    Sec. 743.1  Wassenaar Arrangement.

        (a) Scope. This section outlines special reporting requirements for
    exports of certain commodities, software and technology controlled
    under the Wassenaar Arrangement. Such reports must be submitted to BXA
    semiannually in accordance with the provisions of paragraph (f) of this
    section, and records of all exports subject to the reporting
    requirements of this section must be kept in accordance with part 762
    of the EAR. This section does not require reports for reexports.
        (b) Requirements. You must submit two (2) copies of each report
    required under the provisions of this section and maintain accurate
    supporting records (see Sec. 762.2(b) of the EAR) for all exports of
    items specified in paragraph (c) of this section under any of the
    following License Exceptions authorized by part 740 of the EAR: License
    Exceptions GBS, CIV, TSR, LVS, CTP, and GOV. For purposes of this part
    743, ``you'' has the same meaning as ``U.S. exporter'', as defined in
    part 772 of the EAR.
        (c) Items for which reports are required. (1) You must submit
    reports to BXA under the provisions of this section only for exports of
    items controlled under the following ECCNs:
        (i) Category 1: 1A002, 1C007.c and .d, 1C010.c and .d, 1D002,
    1E001, 1E002.e, and 1E002.f.;
        (ii) Category 2: 2B001.a or .b (certain items only; see Note to
    this paragraph) 2B001.f, 2B003, 2D001, 2E001, and 2E002;

        Note to paragraph (c)(1)(ii): The following are not controlled
    for NP reasons: turning machines controlled by 2B001.a with a
    capacity equal to or less than 35 mm diameter; bar machines
    (Swissturn), limited to machining only bar feed through, if maximum
    bar diameter is equal to or less than 42 mm and there is no
    capability of mounting chucks (machines may have drilling and/or
    milling capabilities for machining parts with diameters less than 42
    mm); or milling machines controlled by 2B001.b with x-axis travel
    greater than two meters and overall ``positioning accuracy'' on the
    x-axis more (worse) than 0.030 mm. Therefore, exports of such items
    under License Exception GOV are subject to reporting requirements.

        (iii) Category 3: 3A002.g.2, 3B001.a.2, 3D001, and 3E001;
        (iv) Category 4: 4A001.a.2 and .b, 4A003.b and .c (see paragraph
    (c)(2) of this section), 4D001, 4D003.c, and 4E001;
        (v) Category 5: 5A001.b.8, 5B001 (items specially designed for
    5A001.b.8), 5D001.a and .b, 5E001.a, 5A002, 5B002, 5D002, and 5E002;
        (vi) Category 6: 6A001.a.1.b, .a.2.c, .a.2.d, and .a.2.e; 6A002.b,
    6A004.c and d, 6A006.g and h, 6A008.d, .h, and .k; 6D001, 6D003.a,
    6E001, and 6E002;
        (vii) Category 8: 8A001.c; 8A002.b, .h, .j, .o.3.a, and .p; 8D001,
    8D002, 8E001, and 8E002.a; and
        (viii) Category 9: 9B001.b, 9D001, 9D002, 9D004.a and .c, 9E001,
    9E002, 9E003.a.1, 9E003.a.2, .a.3, .a.4, .a.5, .a.8, and .a.9.
        (2) Reports for ``digital computers'' and ``electronic assemblies''
    controlled under ECCN 4A003.b and .c are required only for computers
    with a composite theoretical performance (CTP) exceeding 4,000 MTOPS or
    computer enhancements thereof such that the CTP exceeds 4,000 MTOPS.
    Records for software controlled by 4D001 are required for software
    specially designed for the development or production of computers
    having a CTP exceeding 4,000 MTOPS. For the calculation of CTP, see the
    Technical Note for Category 4 in the Commerce Control List (Supplement
    No. 2 to part 774 of the EAR).
        (d) Country Exceptions. You must report each export subject to the
    provisions of this section, except for exports to countries identified
    in Country Group A:1 (see Supplement No. 1 to part 740 of the EAR).
        (e) Information that must be included in each report. (1) Each
    report submitted to BXA for items other than those identified in
    paragraph (e)(2) of this section must include the following information
    for each export during the time periods specified in paragraph (f) of
    this section:
        (i) Export Control Classification Number and paragraph reference as
    identified on the Commerce Control List;
        (ii) Number of units in the shipment; and

    [[Page 2459]]

        (iii) Country of ultimate destination.
        (2) Reports for ``digital computers'' and ``electronic assemblies''
    controlled under ECCN 4A003.b and .c must include the following
    information:
        (i) Date of shipment;
        (ii) Name and address of the end-user and each intermediate
    consignee;
        (iii) CTP of each computer or aggregation of computing elements in
    shipment;
        (iv) Quantity shipped; and
        (v) End-use.
        (f) Frequency and timing of reports. You must submit reports
    subject to the provisions of this section semiannually. The reports
    must be labeled with the exporting company's name and address at the
    top of each page and must include for each such export all the
    information specified in paragraph (e) of this section. The reports
    shall cover exports made during six month time periods spanning from
    January 1 through June 30 and July 1 through December 31.
        (1) The first report must be submitted to and received by BXA no
    later than August 1, 1998 for the partial reporting period beginning
    January 15, 1998 and ending June 30, 1998. Thereafter, reports are due
    according to the provisions of paragraphs (f)(2) and (f)(3) of this
    section.
        (2) Reports for the reporting period ending June 30 must be
    submitted to and received by BXA no later than August 1.
        (3) Reports for the reporting period ending December 31 must be
    submitted to and received by BXA no later than February 1.
        (g) Mailing address and facsimile number: (1) Two (2) copies of
    reports required under this section shall be delivered to one of the
    following addresses. BXA will not accept reports sent C.O.D.
        (i) For deliveries by U.S. postal service:

    Bureau of Export Administration, U.S. Department of Commerce, P.O.
    Box 273, Attn: ``Wassenaar Reports'', Washington, D.C. 20044

        (ii) For courier deliveries:

    Bureau of Export Administration, U.S. Department of Commerce, Attn:
    ``Wassenaar Reports'', Room 2705, 14th Street and Pennsylvania Ave.,
    N.W., Washington, D.C. 20230

        (2) Reports may also be sent by facsimile to: (202) 482-3345, Attn:
    ``Wassenaar Reports''.
        (h) Contacts. General information concerning the Wassenaar
    Arrangement and reporting obligations thereof is available from the
    Office of Strategic Trade and Foreign Policy Controls, Tel. (202) 482-
    0092, Fax: (202) 482-4094.

    Sec. 743.2  [Reserved]

    PART 744--[AMENDED]

        19. Section 744.8(b) is amended by revising the phrase ``7A006,
    7A106, 7A115, 7A994,'' to read ``7A006, 7A994''.

    PART 746--[AMENDED]

        20. Section 746.8(b)(1)(ii) is amended by revising the phrase
    ``6E002, 9A115, 9A991.a,'' to read ``6E002, 9A991.a,''.

    PART 762--[AMENDED]

        21. Section 762.2 is amended by revising paragraphs (b)(35) and
    (b)(36) and by adding a new paragraph (b)(37) to read as follows:

    Sec. 762.2  Records to be retained.

    * * * * *
        (b) * * *
        (35) Sec. 764.5, Voluntary self-disclosure;
        (36) Sec. 766.10, Subpoenas; and
        (37) Sec. 743.1, Wassenaar reports.

    PART 774--[AMENDED]

        22. Supplement No. 1 to part 774 is revised to read as follows:

    [Categories in separate files]

    Category 0--Nuclear Materials, Facilities, and Equipment (48K)

    Category 1--Materials, Chemicals, "Microorganisms" & "Toxins" (130K)

    Category 2--Material Processing (122K)

    Category 3--Electronics (84K)

    Category 4--Computers (45K)

    Category 5--Telecommunications, Part I (27K)

    Category 5--"Information Security", Part II (13K)

    Category 6--Sensors and Lasers (95K)

    Category 7--Navigation and Avionics (37K)

    Category 8--Marine (27K)

    Category 9--Propulsion Systems, Space Vehicles and Related Equipment (65K)