Addition of Entities and Revision of Entries on the Entity List

<RULE> DEPARTMENT OF COMMERCE <SUBAGY>Bureau of Industry and Security</SUBAGY> <CFR>15 CFR Part 744</CFR> <DEPDOC>[Docket No. 240621-0171]</DEPDOC> <RIN>RIN 0694-AJ66</RIN> <SUBJECT>Addition of Entities and Revision of Entries on the Entity List</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 rule, the Bureau of Industry and Security (BIS) amends the Export Administration Regulations (EAR) by adding six entries to the Entity List, under the destinations of the People's Republic of China (China) (2), South Africa (1), the United Arab Emirates (UAE) (2), and the United Kingdom (1). These entities have been determined by the U.S. Government to be acting contrary to the national security or foreign policy interests of the United States. This rule also modifies two existing entities on the Entity List, one under the destination of China and one under the destination of Russia. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> This rule is effective July 3, 2024. </EFFDATE> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> 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> </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">Background</HD> <HD SOURCE="HD2">The Entity List</HD> The Entity List (supplement no. 4 to part 744 of the EAR (15 CFR parts 730 through 774)) identifies entities for which there is reasonable cause to believe, based on specific and articulable facts, that the entities have been involved, are involved, or pose a significant risk of being or becoming involved in activities contrary to the national security or foreign policy interests of the United States, pursuant to § 744.11(b). The EAR impose additional license requirements on, and limit the availability of, most license exceptions for exports, reexports, and transfers (in-country) when a listed entity is a party to the transaction. The license review policy for each listed entity is identified in the “License Review Policy” column on the Entity List, and the impact on the availability of license exceptions is described in the relevant <E T="04">Federal Register</E> document that added the entity to the Entity List. BIS places entities on the Entity List pursuant to parts 744 (Control Policy: End-User and End-Use Based) and 746 (Embargoes and Other Special Controls) of the EAR. The End-User Review Committee (ERC), composed of representatives of the Departments of Commerce (Chair), State, Defense, Energy and, where appropriate, the Treasury, makes all decisions regarding additions to, removals from, or other modifications to the Entity List. The ERC makes all decisions to add an entry to the Entity List by majority vote and makes all decisions to remove or modify an entry by unanimous vote. <HD SOURCE="HD1">Entity List Decisions</HD> <HD SOURCE="HD2">Additions to the Entity List</HD> The ERC determined to add Global Training Solutions Limited and Smartech Future Limited, both under the destination of China, Grace Air (Pty) Ltd. under the destination of South Africa, and Livingston Aerospace Ltd., under the destination of the United Kingdom, to the Entity List. These entities are listed because of their links to the Test Flying Academy of South Africa (TFASA) and the training of China's military forces using Western and North Atlantic Treaty Organization (NATO) sources. TFASA was added to the Entity List on June 12, 2023 (88 FR 38739, June 14, 2023). This activity is contrary to the national security and foreign policy interests of the United States under § 744.11 of the EAR. The ERC determined to add two entities, Mega Fast Cargo LLC, and Mega Technique General Trading, both under the destination of the UAE, to the Entity List. These additions are being made because these entities repeatedly engaged in dilatory or evasive conduct, including the provision of false, misleading, or incomplete information, during end-use checks. In addition, Mega Fast Cargo LLC has engaged in shipments of U.S.-origin commodities to Russia since Russia's further invasion of Ukraine in February 2022. This activity is contrary to U.S. national security and foreign policy interests under § 744.11 of the EAR. For these six entities, BIS imposes a license requirement for all items subject to the EAR and will review license applications under a presumption of denial. For the reasons described above, this final rule adds the following six entities, including aliases where appropriate, to the Entity List: <HD SOURCE="HD1">China</HD> • Global Training Solutions Limited; <E T="03">and</E> • Smartech Future Limited. <HD SOURCE="HD1">South Africa</HD> • Grace Air (Pty) Ltd. <HD SOURCE="HD1">United Arab Emirates</HD> • Mega Fast Cargo LLC; <E T="03">and</E> • Mega Technique General Trading. <HD SOURCE="HD1">United Kingdom</HD> • Livingston Aerospace Ltd. <HD SOURCE="HD2">Modifications to the Entity List</HD> This final rule implements the decision of the ERC to modify two existing entries on the Entity List. Specifically, the ERC determined to add three aliases to the entity Tenco Technology Company Ltd., under the destination of China, for a total of seven aliases. In addition, the ERC determined to revise the entry for Systems of Biological Synthesis LLC, under the destination of Russia, by adding one address for a total of two addresses. <HD SOURCE="HD2">Savings Clause</HD> For the changes being made in this final rule, shipments of items removed from eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR) as a result of this regulatory action that were en route aboard a carrier to a port of export, reexport, or transfer (in-country), on July 3, 2024, pursuant to actual orders for export, reexport, or transfer (in-country) to or within a foreign destination, may proceed to that destination under the previous eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR) before August 2, 2024. Any such items not actually exported, reexported or transferred (in-country) before midnight, on August 2, 2024, require a license in accordance with this final rule. <HD SOURCE="HD1">Export Control Reform Act of 2018</HD> On August 13, 2018, the President signed into law the John S. McCain National Defense Authorization Act for Fiscal Year 2019, which included the Export Control Reform Act of 2018 (ECRA) (50 U.S.C. 4801-4852). ECRA provides the legal basis for BIS's principal authorities and serves as the authority under which BIS issues this rule. <HD SOURCE="HD1">Rulemaking Requirements</HD> 1. This rule has been determined to be not significant for purposes of Executive Order 12866. 2. Notwithstanding any other provision of law, no person is required to respond to or be subject to a penalty for failure to comply with a collection of information, subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 <E T="03">et seq.</E> ) (PRA), unless that collection of information displays a currently valid Office of Management and Budget (OMB) Control Number. This regulation involves an information collection approved by OMB under control number 0694-0088, Simplified Network Application Processing System. BIS does not anticipate a change to the burden hours associated with this collection as a result of this rule. Information regarding the collection, including all supporting materials, can be accessed at <E T="03">https://www.reginfo.gov/public/do/PRAMain.</E> 3. This rule does not contain policies with federalism implications as that term is defined in Executive Order 13132. 4. Pursuant to section 1762 of the Export Control Reform Act of 2018, this action is exempt from the Administrative Procedure Act (5 U.S.C. 553) requirements for notice of proposed rulemaking, opportunity for public participation, and delay in effective date. 5. Because a notice of proposed rulemaking and an opportunity for public comment are not required to be given for this rule by 5 U.S.C. 553, or by any other law, the analytical requirements of the Regulatory Flexibility Act, 5 U.S.C. 601, <E T="03">et seq.,</E> are not applicable. Accordingly, no regulatory flexibility analysis is required, and none has been prepared. <LSTSUB> <HD SOURCE="HED">List of Subjects in 15 CFR Part 744</HD> Administrative practice and procedure, Exports, Reporting and recordkeeping requirements, Terrorism. </LSTSUB> Accordingly, part 744 of the Export Administration Regulations (15 CFR parts 730 through 774) is amended as follows: <HD SOURCE="HED">PART 744—CONTROL POLICY: END-USER AND END-USE BASED</HD> <REGTEXT TITLE="15" PART="744"> 1. The authority citation for part 744 continues to read as follows: <HD SOURCE="HED">Authority: </HD> 50 U.S.C. 4801-4852; 50 U.S.C. 4601 <E T="03">et seq.;</E> 50 U.S.C. 1701 <E T="03">et seq.;</E> 22 U.S.C. 3201 <E T="03">et seq.;</E> 42 U.S.C. 2139a; 22 U.S.C. 7201 <E T="03">et seq.;</E> 22 U.S.C. 7210; E.O. 12058, 43 FR 20947, 3 CFR, 1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p. 608; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13099, 63 FR 45167, 3 CFR, 1998 Comp., p. 208; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13224, 66 FR 49079, 3 CFR, 2001 Comp., p. 786; Notice of September 7, 2023, 88 FR 62439 (September 11, 2023); Notice of November 1, 2023, 88 FR 75475 (November 3, 2023). </REGTEXT> <REGTEXT TITLE="15" PART="744"> 2. Supplement no. 4 is amended by: a. Under CHINA, PEOPLE'S ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 18k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━