As of March 18, 2021, the United States imposed additional restrictions on certain exports (and re-exports) to Russia. The restrictions are imposed pursuant to Section 306 (a) of the Chemical and Biological Weapons Control and Elimination of War Act 1991, based on a determination that Russia “has used weapons”. chemical or biological weapons in violation of international law or deadly chemical or biological weapons. against its own nationals.
So what are the restrictions and what do they mean in practice?
ITAR exports (defense)
The State Department added Russia to Section 126.1 of the International Traffic in Arms Regulations (“ITAR”), which lists countries subject to a policy of denial of export, re-export and temporary importation. ‘items described on the United States Ammunition List. (“USML”). See 86 FR 14802 (March 18, 2021). The State Department will authorize a case-by-case review of this policy for exports that support government space cooperation and commercial space launches by September 1, 2021.
In practice, the US government has generally refused licenses to export ITAR-controlled items to Russia for a number of years. Nonetheless, the official addition of Russia to ITAR 126.1 will have important practical consequences for the industry, as it makes most of the ITAR exemptions from licensing requirements unavailable to Russia. Notable examples include exemptions from ITAR 123.16 for trade shows and exports to US-owned affiliates, exemptions from ITAR 125.4 for personal use (for example, traveling with electronic devices containing data controlled by ITAR) and deemed exports by US institutions of higher education to their foreign employees, and the exemption from ITAR 126.18 for two-third country national (“DTCN”) employees of foreign license holders . So, for example, American companies will have to update internal procedures for authorizing international travel with electronic devices that may contain technical data controlled by ITAR in order to exclude Russia. US universities will need to review access to ITAR for foreign employees who are Russian nationals. And foreign companies that rely on the ITAR 126.18 (c) (2) exemption to allow access to ITAR-controlled items by DTCN employees will need to update their procedures to filter these employed for “important contacts” with Russia.
EAR exports (dual use, commercial and military less sensitive)
The addition of Russia to ITAR 126.1 triggers the addition of Russia to the D: 5 country group for the purposes of US dual-use export controls, the Export Administration Regulations (“EAR”). Accordingly, the Ministry of Commerce announcement that it will generally apply a presumption of refusal to license applications for exports to Russia of items that are described on the Trade Control List (“CCL”) under an Export Control Classification Number (“ECCN” ) having national security (NS) as a reason for control. However, the Bureau of Industry and Safety (“BIS”) will not apply the presumption of refusal to license applications concerning: (i) the elements necessary for the safety of the flight of civil aviation from passengers to fixed wing; (ii) deemed exports and re-exports to Russian nationals; (iii) items destined for wholly owned US subsidiaries and other foreign subsidiaries of US companies located in Russia; and (iv) elements in support of government space cooperation. In addition, for a limited time, until September 1, 2021, BIS will process license applications for items in support of commercial space launches.
The March 18 changes also affect the availability of EAR licensing exceptions for the export of NS-controlled items to Russia. The BIS has issued a waiver to allow the continued use of the license exceptions TMP (temporary exports), GOV (certain government activities and the International Space Station), BAG (personal baggage), AVS (certain exports related to aircraft, ships and spacecraft) and ENC (Encryption Items) for NS-controlled items destined for Russia. However, BIS has suspended the RPL (Maintenance and Replacement), TSU (Restricted Technology and Software) and APR (Permissive Re-exports) license exceptions for these items.
As with the ITAR changes discussed above, adding Russia to the D: 5 country group may also disrupt foreign companies that have employees with “substantial contact” with Russia. Under EAR 734.20 (c), dissemination of EAR-controlled technology to employees is determined, through appropriate selection procedures, not have “substantial contacts” with the D: 5 countries is not considered to be a deemed re-export and not not require authorization from the AEOI. However, the diffusion of EAR-controlled technology to employees who to do have substantial contacts with D: 5 countries — now including Russia—Is constitute a deemed re-export and, depending on the classification of the technology involved, may require a license from BIS.
Finally, the addition of Russia to the D: 5 country group means that foreign companies exporting overseas-produced items to Russia will need a U.S. export license for those overseas-produced items. ‘they: (i) contain all amount of content of American origin classified in a 9 × 515 or “600 series” ECCN, other than items in paragraph .y; or (ii) are “military products” and incorporate one or more of the products described in ECCN 0A919.a.1. See 15 CFR 734.4 (a) (5), (a) (6).