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Export Control Requirements to be Added to Energy Regulations

Wednesday, June 12, 2013
Sandler, Travis & Rosenberg Trade Report

The Department of Energy is accepting comments through July 12 on a proposed rule that would amend the Department of Energy Acquisition Regulation to add requirements for DOE contractors concerning compliance with laws, regulations and directives governing the control of exports of items such as unclassified information, materials, technology, equipment or software. The DOE states that this rule addresses concerns raised in (a) a DOE Inspector General report issued in 2004, which found two DOE contractors to have not properly applied export control procedures and urged the DOE to ensure that export control guidance, including deemed export guidance, is disseminated and consistently implemented throughout the DOE complex; (b) a DOE IG report issued in 2007, which recommended expedited actions to ensure compliance with export control requirements throughout the DOE complex, and (c) a 2011 Government Accountability Office report identifying weaknesses in government-wide export controls.

Among other things, this proposed rule would require DOE contractors to obtain the necessary licenses, approvals and relevant documentation to comply with the applicable laws, regulations and directives, which include the following.

Atomic Energy Act of 1954 – empowers DOE to authorize persons subject to U.S. jurisdiction to engage directly or indirectly in the production of special nuclear material outside of the U.S.

Arms Export Control Act – provides the authority (designated to the secretary of State) to control the export of defense articles and services

Export Administration Act – provides legal authority to control, for reasons of national security, foreign policy and/or short supply, the export and reexport of items that are subject to the Export Administration Regulations (the EAA has expired but has been continued under the International Emergency Economic Powers Act)

Trading With the Enemy Act – restricts trade with countries hostile to the U.S. and gives the president the power to oversee or restrict any and all trade between the U.S. and its enemies in times of war

Foreign Assistance Act of 1961 – restricts assistance to any government that engages in a consistent pattern of gross violations of internationally recognized human rights

10 CFR Part 810, “Assistance to Foreign Atomic Energy Activities” – reflects the DOE’s jurisdictional authority over exports of unclassified nuclear technology

10 CFR Part 110, “Export and Import of Nuclear Equipment and Material” – reflects the Nuclear Regulatory Commission’s jurisdictional authority over exports for peaceful nuclear purposes of nuclear reactors, nuclear enrichment and reprocessing facilities, heavy water production facilities, related proprietary operation and maintenance manuals, and related equipment, as well as exports of special nuclear material, source material, byproduct material and deuterium

Export Administration Regulations – reflects the Commerce Department’s jurisdictional authority over a broad range of dual-use commodities (items that have both commercial and potentially military applications) and items not controlled by other export regimes

International Traffic in Arms Regulations – reflects the State Department’s jurisdictional authority under the AECA over munitions items, including military systems, equipment, components and services, and space-related systems, equipment, components, services and items

Foreign Assets Control Regulations – reflects the Treasury Department’s jurisdictional authority under the TWEA over all financial and tangible items destined to embargoed and terrorist sponsoring states

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