Implementation of Additional Sanctions Against Russia and Belarus Under the Export Administration Regulations (EAR) and Refinements to Existing Controls

<RULE> DEPARTMENT OF COMMERCE <SUBAGY>Bureau of Industry and Security</SUBAGY> <CFR>15 CFR Parts 734, 740, 744, 746, and 774</CFR> <DEPDOC>[Docket No. 240610-0156]</DEPDOC> <RIN>RIN 0694-AJ67</RIN> <SUBJECT>Implementation of Additional Sanctions Against Russia and Belarus Under the Export Administration Regulations (EAR) and Refinements to Existing Controls</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Bureau of Industry and Security, Department of Commerce. <HD SOURCE="HED">ACTION:</HD> Final rule. <SUM> <HD SOURCE="HED">SUMMARY:</HD> In this final rule, the Bureau of Industry and Security (BIS) makes changes to the Russia and Belarus sanctions under the Export Administration Regulations (EAR). This final rule imposes additional export control measures against Russia and Belarus by expanding the scope of items identified under two EAR supplements that are subject to the EAR's Russian and Belarusian industry sector sanctions; imposing a “software” license requirement for certain EAR99-designated “software” when destined to or within Russia or Belarus; and narrowing the scope of commodities and software that may be authorized for export, reexport, or transfer (in-country) to or within Russia or Belarus under License Exception Consumer Communications Devices (CCD). To promote clarity and facilitate compliance, this final rule also consolidates the EAR's Russian and Belarus sanctions into a single section, while maintaining the existing related regulatory supplements identifying items that are subject to certain of those sanctions. This final rule also amends the EAR by adding five entities and eight addresses to the Entity List and making changes to the Entity List structure. These entries are listed on the Entity List under the destinations of the People's Republic of China (China) and Russia and have been determined by the U.S. Government to be acting contrary to the national security or foreign policy interests of the United States. Lastly, this final rule makes two additional revisions to the EAR: one to confirm the criteria used when revising, suspending, or revoking EAR license exceptions and one revision to clarify the control status of fasteners for purposes of the EAR's Russian and Belarusian industry sector sanctions. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> This rule is effective on June 12, 2024, except for amendatory instruction 14, which is effective September 16, 2024. </EFFDATE> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> For general questions on this final rule, contact Collmann Griffin, Senior Policy Advisor, International Policy Office, Bureau of Industry and Security, Department of Commerce, Phone: 202-482-1430, Email: <E T="03">william.griffin@bis.doc.gov.</E> For questions on the Entity List changes in this final rule, contact Chair, End-User Review Committee, Office of the Assistant Secretary for Export Administration, Bureau of Industry and Security, Department of Commerce, Phone: (202) 482-5991, Email: <E T="03">ERC@bis.doc.gov.</E> For emails, include “Russia and Belarus, June 2024 export control measures” in the subject line. </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Background</HD> <HD SOURCE="HD2">A. Export Controls Implemented Against Russia and Belarus</HD> In response to Russia's February 2022 full-scale invasion of Ukraine, BIS imposed extensive sanctions on Russia under the EAR as part of the final rule, “Implementation of Sanctions Against Russia Under the Export Administration Regulations (EAR)” (“Russia Sanctions Rule”) (87 FR 12226, March 3, 2022). To address Belarus's complicity in the invasion, BIS imposed similar sanctions on Belarus under the EAR in a final rule, “Implementation of Sanctions Against Belarus” (“Belarus Sanctions Rule”) (87 FR 13048, March 6, 2022). During the last two years, BIS has published a number of additional final rules strengthening the export controls on Russia and Belarus, including measures undertaken in coordination with U.S. allies and partners. <HD SOURCE="HD2">B. Overview of This Final Rule</HD> In this final rule, BIS makes changes to the Russia and Belarus sanctions under the EAR along with certain changes that are not specific to those two countries. Certain of these changes (see section II.A) are designed to better protect U.S. national security and foreign policy interests by expanding the scope of the current sanctions. Others (see sections II.B and C) will promote clarity and facilitate compliance. The four sets of changes this final rule makes are described in section II as follows: A. Additional export control measures against Russia and Belarus; B. Consolidation of Russia and Belarus sanctions into a single section; C. Additions to the Entity List and changes to the Entity List structure; <E T="03">and</E> D. Confirmation of the standard used in connection with actions involving the availability of license exceptions and clarification of the scope of a commodity subject to the Russian and Belarusian industry sanctions. <HD SOURCE="HD1">II. Amendments to the EAR</HD> <HD SOURCE="HD2">A. Additional Export Control Measures Against Russia and Belarus</HD> This final rule imposes additional export control measures against Russia and Belarus by expanding the scope of items that are subject to the Russian and Belarusian industry sector sanctions under supplement nos. 4 and 6 to part 746 (see section II.A.1 and II.A.2); imposing a “software” license requirement for certain EAR99-designated “software” when destined for Russia or Belarus; and narrowing the scope of commodities and software that may be authorized for export, reexport, or transfer (in-country) to or within Russia and Belarus under License Exception CCD. 1. <E T="03">Expansion of Russian and Belarusian industry sector sanctions by adding items to supplement no. 4 to part 746 consistent with the objective to undermine Russia's and Belarus's industrial bases and their ability to continue to support Russia's military aggression in Ukraine.</E> This rule expands the list of items set forth in supplement no. 4 to part 746 (Russian and Belarusian Industry Sector Sanctions Pursuant to § 746.5(a)(1)(ii)) (this final rule relocates the restrictions of § 746.5(a)(1)(ii) to § 746.8(a)(5)), as detailed below in section II.B.2. Specifically, this rule adds 522 additional Harmonized Tariff Schedule (HTS)-6 Code entries to supplement no. 4; consequently, these items will now require a license for export to, reexport to, or transfer (in-country) within Russia or Belarus under § 746.8(a)(5). Restrictions on these industrial items are intended to further undermine the Russian and Belarusian industrial bases and their ability to continue to support Russia's military aggression in Ukraine. The complete list of 522 new HTS-6 Codes this rule adds to supplement no. 4 are identified in amendatory instruction 18. Through the addition of these HTS codes, BIS intends to further limit Russia's access to items of potential military significance and expand the economic impact of controls that will deny Russia additional resources it needs to continue waging war. Items controlled through amendments made by this rule were identified based on a review of public and non-public information regarding which items Russia seeks to further its war against Ukraine, an evaluation of areas in which U.S. trade has continued to provide an economic benefit to Russia, and an assessment of how the United States could further degrade Russia's war effort. With these new controls, BIS also further minimizes opportunities for the circumvention of U.S. export controls on Russia and Belarus through misclassification of the HTS-6 code. Supplement no. 4 to part 746 will now cover, with the addition of these 522 HTS-6 codes, items subject to the EAR classified under all HTS codes in 18 additional chapters of HTS codes. Making these additions will minimize situations where persons could seek to circumvent export license requirements by changing the classification of an item that requires a license to the classification of an item in a similar HTS code that does not require a license. BIS estimates these changes to supplement no. 4 to part 746 will result in an additional five license applications submitted to BIS annually. 2. <E T="03">Expansion of Russian and Belarusian industry sector sanctions by adding items to supplement no. 6 to part 746 consistent with the objective to undermine Russia's and Belarus's industrial bases and their ability to continue to support Russia's military aggression in Ukraine.</E> In supplement no. 6 to part 746 (Russian and Belarusian Industry Sector Sanctions Pursuant to § 746.5(a)(1)(iii)) (this final rule relocates the restrictions of § 746.5(a)(1)(iii) to § 746.8(a)(6)), this final rule adds a new paragraph (h) to control certain riot control agents that are isomers of CS (o-Chlorobenzylidenemalononitrile or o-Chlorobenzalmalononitrile) (CAS 2698-41-1); CN (Phenylacyl chloride or w-Chloroacetophenone) (CAS 532-27-4); or Oleoresin Capsicum (CAS 8023-77-6). Specifically, paragraphs (h)(1) through (10) describe these riot control agents that will be controlled under the EAR's Russian and Belarusian industry sector sanctions. These chemicals meet the definition of riot control agents under Article II (paragraph 7) of the Chemical Weapons Convention (CWC). These expanded controls will supplement the existing Commerce Control List (CCL) controls under ECCNs 1A984 and 1C607; in particular, they will address Russia's use of riot control agents as a method of warfare against Ukrainian forces in violation of the CWC. <E T="03">See</E> May 1, 2024 State Department Fact Sheet announcing the imposition of sanctions on Russia under the Chemical and Biological Weapons Control and Warfare Elimination Act of 1991, available at <E T="03">http ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 266k characters. 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