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Effort to “Tier” Export Control Lists Postponed to Avoid Problems for Exporters

Wednesday, December 07, 2011
Sandler, Travis & Rosenberg Trade Report

According to the State Department, the Obama administration has postponed part of its effort to overhaul existing export control lists. This delay is meant to avoid undue hardship for exporters, but the administration intends to revisit the issue at a later time.

In December 2010 the administration announced its intention make the U.S. Munitions List and the Commerce Control List more positive, tiered and aligned so that eventually they can be combined into a single control list. The administration also called for the establishment of a “bright line” between the USML and the CCL to clarify whether particular items are subject to the jurisdiction of the International Traffic in Arms Regulations or the Export Administration Regulations.

While these remain the ultimate objectives of the Export Control Reform Initiative, State asserts that their concurrent implementation would be “problematic” in the near term. Specifically, the administration has determined that fundamentally altering the structure of the USML by tiering and aligning it on a category-by-category basis would significantly disrupt the export control compliance systems and procedures of exporters and reexporters. For example, until the entire USML was revised and became final, some categories would follow the legacy numbering and control structures while the newly revised categories would follow a completely different numbering structure.

The administration has therefore decided to proceed with building positive USML and CCL lists now (see related article this issue) and return to structural changes “afterward.” It is believed that this approach will allow the U.S. to more quickly reach its national security objectives of greater interoperability with allies, enhancing the domestic defense industrial base and permitting the federal government to focus its resources on controlling and monitoring the export and reexport of more significant items to destinations, end uses and end users of greater concern than NATO and other multi-regime partners.

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