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State and Commerce Publish New Proposed Rules on Military Electronics

Thursday, July 25, 2013
Sandler, Travis & Rosenberg Trade Report

As part of the ongoing Export Control Reform initiative, the United States Departments of State and Commerce published second proposed rules revising controls on military electronics. The Commerce Department administers the Export Administration Regulations while the State Department administers the International Traffic in Arms Regulations that include the U.S. Munitions List (USML).

The second proposed rules are a direct response to comments submitted after the first rule was published on November 28, 2012. According to Undersecretary of Commerce Eric Horschhorn, the government’s reaction to public comments in revising the previously published proposed rules shows that it is serious about ensuring that the rules are written in a way that is understandable and consistent with the reform initiative.

“We are publishing a second proposed rule because many of the comments to the first proposed rule provided hard evidence supporting changes,” he said. “We wanted to give industry a chance to see and comment on the changes before they become final.”

Assistant Secretary of Commerce Kevin Wolf encouraged the trade to participate in the process by providing detailed comments and acknowledged that government rules can sometimes have unintended consequences for industry.

“We need to listen closely to you regarding how the new regulations are actually working in practice to spot any unintended consequences…do not hesitate to let us know if you spot something that seems odd or unintended. It may have been deliberate, but maybe not,” Wolf said.

Wolf also offered advice on comment content. “Remember, if we have described something on the revised Category XI or in the new 600 series electronics controls that is in normal commercial use, don’t just tell us about it in conclusory fashion, prove it with evidence of such use. That’s one reason why we decided to publish a second pair of proposed rules.”

The officials made their remarks at the Bureau of Industry and Security Update 2013 Conference in Washington, DC on July 23. Full transcripts of their remarks are available on the BIS website, www.bis.gov.

The deadline for submitting public comments is September 9.

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