PART 740 LICENSE EXCEPTIONS Sec. Page 740.1 Introduction ... · ten General Prohibitions, is not...

Export Administration Regulations February 9, 2010

PART 740

LICENSE EXCEPTIONS

Sec. Page

740.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

740.2 Restrictions on all License Exceptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

740.3 Shipments of limited value (LVS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

740.4 Shipments to Country Group B countries (GBS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

740.5 Civil end-users (CIV) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

740.6 Technology and software under restriction (TSR) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

740.7 Computers (APP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

740.8 [RESERVED] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

740.9 Temporary imports, exports, and reexports (TMP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

740.10 Servicing and replacement of parts and equipment (RPL) . . . . . . . . . . . . . . . . . . . . . . . . . . 20

740.11 Governments, international organizations, internationalinspections under the Chemical Weapons Convention, and the International Space Station (GOV) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

740.12 Gift parcels and humanitarian donations (GFT) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

740.13 Technology and software - unrestricted (TSU) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

740.14 Baggage (BAG) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

740.15 Aircraft and vessels (AVS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

740.16 Additional permissive reexports (APR) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

740.17 Encryption commodities and software (ENC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

740.18 Agricultural commodities (AGR) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

740.19 Consumer communication devices (CCD) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

ADDITIONAL RESTRICTIONS ON USE OFLICENSE EXCEPTION GOV . . . . . . . . . . . . . . . . . . . SUPPLEMENT NO. 1 TO SECTION 740.11


COUNTRY GROUPS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SUPPLEMENT NO. 1

ITEMS THAT MAY BE DONATED TO MEET BASIC HUMAN NEEDS UNDER THE HUMANITARIAN LICENSE EXCEPTION . . . . . . . SUPPLEMENT NO. 2

COUNTRIES ELIGIBLE FOR THE PROVISIONS OF §740.17(a) . . . . . . . SUPPLEMENT NO. 3

License Exceptions Part 740-page 1


§740.1

INTRODUCTION

In this part, references to the EAR are referencesto 15 CFR chapter VII, subchapter C.

(a) Scope

A “License Exception” is an authorizationcontained in this part that allows you to export orreexport under stated conditions, items subject tothe Export Administration Regulations (EAR)that would otherwise require a license underGeneral Prohibition One, Two, Three, or Eight asindicated under one or more of the Export ControlClassification Numbers (ECCNs) in theCommerce Control List (CCL) in Supplement No.1 to part 774 of the EAR and items subject to theEAR that would require a license based on theembargo policies described in part 746 of theEAR. If your export or reexport is subject toGeneral Prohibition Six for embargoeddestinations, refer to part 746 of the EAR todetermine the availability of any LicenseExceptions. Special commodity controls apply toshort supply items. License Exceptions for itemslisted on the CCL as controlled for Short Supplyreasons are found in part 754 of the EAR. If yourexport or reexport is to subject to GeneralProhibition Five, consult part 744 of the EAR. Ifyour export or reexport is subject to GeneralProhibitions Four, Seven, Nine, or Ten, then noLicense Exceptions apply.

(b) Certification

By using any of the License Exceptions you arecertifying that the terms, provisions, andconditions for the use of the License Exceptiondescribed in the EAR have been met. Please referto part 758 of the EAR for clearance of shipmentsand documenting the use of License Exceptions.

(c) License Exception symbols

Each License Exception bears a three lettersymbol that will be used for export clearancepurposes (see paragraph (d) of this section).

(d) Shipper's Export Declaration orAutomated Export System Record

You must enter on any required Shipper’s ExportDeclaration (SED) or Automated Export System(AES) record the correct License Exceptionsymbol (e.g., LVS, GBS, CIV) and the correctExport Control Classification Number (ECCN)(e.g., 4A003, 5A002) for all shipments of itemsexported under a License Exception. Itemstemporarily in the United States meeting theprovisions of License Exception TMP, under§740.9(b)(3), are excepted from this requirement.See §758.1 of the EAR for Shipper’s ExportDeclaration requirements or Automated ExportSystem (AES) requirements.

(e) Destination Control Statement

You may be required to enter an appropriateDestination Control Statement on commercialdocuments in accordance with DestinationControl Statement requirements of §758.6 of theEAR.

(f) Recordkeeping

Records of transactions involving exports underany of the License Exceptions must be maintainedin accordance with the recordkeepingrequirements of part 762 of the EAR.

§740.2

RESTRICTIONS ON ALL LICENSE EXCEPTIONS

(a) You may not use any License Exception ifany one or more of the following apply:



(1) Your authorization to use a LicenseException has been suspended or revoked, or yourintended export does not qualify for a LicenseException.

(2) The export or reexport is subject to one of theten General Prohibitions, is not eligible for aLicense Exception, and has not been authorizedby BIS.

(3) The item is primarily useful for surreptitiousinterception of wire, oral, or electroniccommunications, or related software, controlledunder ECCNs 5A980 or 5D980, unless the item isconsigned to and for the official use of an agencyof the U.S. Government (see § 740.11(b)(2)(ii) ofthis part, Governments (GOV)).

(4) The item being exported or reexported issubject to the license requirements described in§742.7 of the EAR and the export or reexport isnot:

(i) Being made to Australia, Japan, NewZealand, or a NATO (North Atlantic TreatyOrganization) member state (see NATOmembership listing in §772.1 of the EAR);

(ii) Authorized by §740.11(b)(2)(ii) (officialuse by personnel and agencies of the U.S.government); or

(iii) Authorized by §740.14(e) of the EAR(certain shotguns and shotgun shells for personaluse).

(5)(i)The item is controlled for missile technology(MT) reasons, except that the items described inECCNs 6A008, 7A001, 7A002, 7A004, 7A101,7A102, 7A103, 7A104, 7B001, 7D001, 7D002,7D003, 7D101, 7D102, 7E003, or 7E101, may beexported as part of a manned aircraft, land vehicleor marine vehicle or in quantities appropriate forreplacement parts for such applications under§740.9(a)(2)(ii) (License Exception TMP for kitsconsisting of replacement parts), §740.10

(License Exception RPL), §740.13 (LicenseException TSU), or §740.15(c) (LicenseException AVS for equipment and spare parts forpermanent use on a vessel or aircraft).

(ii) MT controlled commodities described inECCN 2A001 may be exported or reexportedunder §740.9(a)(2)(ii) (License Exception TMP) or §740.10 (License Exception RPL) as one-for-one replacement for equipment previously legallyexported or reexported.

(6) The export or reexport is to acomprehensively embargoed destination (Cuba,Iran, and North Korea), unless a license exceptionor portion thereof is specifically listed in thelicense exceptions paragraph pertaining to aparticular embargoed country in part 746 of theEAR.

(7) “Space qualified” items. Commoditiesdefined in 3A001.b.8 (Traveling Wave TubeAmplifiers (TWTAs) exceeding 18 GHz),6A002.e, 6A008.j.1, or 6A998.b; “software” forcommodities defined in 3A001.b.8 (TravelingWave Tube Amplifiers (TWTAs) exceeding 18GHz), 6A002.e, 6A008.j.1, or 6A998.b andcontrolled under ECCNs 3D001 (Traveling WaveTube Amplifiers (TWTAs) exceeding 18 GHz),6D001, 6D002, 6D991; and “technology” forcommodities defined in ECCNs 3A001.b.8(Traveling Wave Tube Amplifiers (TWTAs)exceeding 18 GHz), 6A002.e, 6A008.j.1, or6A998.b and controlled under ECCNs 3E001,6E001, 6E002, 6E101, 6E991.

(8) The item is controlled under ECCNs 2A983,2D983 or 2E983 and the License Exception isother than:

(i) RPL, under the provisions of §740.10,including §740.10(a)(3)(v), which prohibitsexports and reexports of replacement parts tocountries in Country Group E:1 (see Supplement1 to part 740));



(ii) GOV, restricted to eligibility under theprovisions of §740.11(b)(2)(ii) or (v); or

(iii) TSU, under the provisions of §740.13(a)and (c).

(9) The item is a QRS11-00100-100/101Micromachined Angular Rate Sensor controlledfor RS reasons under ECCN 7A994.

(10) The commodity being exported orreexported is subject to the license requirementsof §742.11 of the EAR.

(11) The item is a “military commodity” subjectto ECCN 0A919, except that such militarycommodities may be reexported in accordancewith § 740.11(b)(2)(ii) (official use by personneland agencies of the U.S. Government).

(b) All License Exceptions are subject torevision, suspension, or revocation, in whole or inpart, without notice. It may be necessary for BISto stop a shipment or an export transaction at anystage of its progress, e.g., in order to prevent anunauthorized export or reexport. If a shipment isalready en route, it may be further necessary toorder the return or unloading of the shipment atany port of call.

(c) BIS may by informing the exporter, suspendor revoke any License Exception in order tocomply with U.S. Wassenaar obligations. Inaddition, BIS may inform an exporter, that beforeusing any License Exception, a notice besubmitted with BIS concerning the proposedexport.

(d) See §746.3 for restrictions on certaintransfers within Iraq of items exported orreexported to Iraq pursuant to a LicenseException.

§740.3

SHIPMENTS OF LIMITED VALUE (LVS)

(a) Scope

License Exception LVS authorizes the export andreexport in a single shipment of eligiblecommodities as identified by “LVS - $(valuelimit)” on the CCL.

(b) Eligible Destinations

This License Exception is available for alldestinations in Country Group B (see SupplementNo. 1 to part 740), provided that the net value ofthe commodities included in the same order andcontrolled under the same ECCN entry on theCCL does not exceed the amount specified in theLVS paragraph for that entry.

(c) Definitions

(1) Order. The term “order” as used in this §-740.3 means a communication from a person in aforeign country, or that person's representative,expressing an intent to import commodities fromthe exporter. Although all of the details of theorder need not be finally determined at the time ofexport, terms relating to the kinds and quantitiesof the commodities to be exported, as well as theselling prices of these commodities, must befinalized before the goods can be exported underLicense Exception LVS.

(2) Net value: for LVS shipments. The actualselling price of the commodities that are includedin the same order and are controlled under thesame entry on the CCL, less shipping charges, orthe current market price of the commodities to thesame type of purchaser in the United States,whichever is the larger. In determining the actualselling price or the current market price of thecommodity, the value of containers in which thecommodity is being exported may be excluded.The value for LVS purposes is that of the



controlled commodity that is being exported, andmay not be reduced by subtracting the value ofany content that would not, if shipped separately,be subject to licensing. Where the total value ofthe containers and their contents must be shownon Shipper's Export Declarations under oneSchedule B Number, the exporter, in effecting ashipment under this License Exception, mustindicate the “net value” of the containedcommodity immediately below the description ofthe commodity.

(3) Single shipment. All commodities movingat the same time from one exporter to oneconsignee or intermediate consignee on the sameexporting carrier even though these commoditieswill be forwarded to one or more ultimateconsignees. Commodities being transported inthis manner will be treated as a single shipmenteven if the commodities represent more than oneorder or are in separate containers.

(d) Additional eligibility requirements and restrictions

(1) Eligible orders. To be eligible for thisLicense Exception, orders must meet thefollowing criteria:

(i) Orders must not exceed the applicable“LVS” dollar value limits. An order is eligiblefor shipment under LVS when the “net value” ofthe commodities controlled under the same entryon the CCL does not exceed the amount specifiedin the “LVS” paragraph for that entry. An LVSshipment may include more than one eligibleorder.

(ii) Orders may not be split to meet theapplicable LVS dollar limits. An order thatexceeds the applicable LVS dollar value limitmay not be misrepresented as two or more orders,or split among two or more shipments, to give theappearance of meeting the applicable LVS dollarvalue limit. However an order that meets all theLVS eligibility requirements, including the

applicable LVS dollar value limit, may be splitamong two or more shipments.

(iii) Orders must be legitimate. Exporters andconsignees may not, either collectively orindividually, structure or adjust orders to meet theapplicable LVS dollar value limits. (2) Restriction on annual value of LVS orders.The total value of exports per calendar year to thesame ultimate or intermediate consignee ofcommodities classified under a single ECCN maynot exceed 12 times the LVS value limit for thatECCN; however, there is no restriction on thenumber of shipments provided that value is notexceeded. This annual value limit applies toshipments to the same ultimate consignee eventhough the shipments are made through more thanone intermediate consignee. There is norestriction on the number of orders that may beincluded in a shipment, except that the annualvalue limit per ECCN must not be exceeded.

(3) Orders where two or more LVS dollarvalue limits apply. An order may includecommodities that are controlled under more thanone entry on the CCL. In this case, the net valueof the entire order may exceed the LVS dollarvalue for any single entry on the CCL. However,the net value of the commodities controlled undereach ECCN entry shall not exceed the LVS dollarvalue limit specified for that entry.

Example to paragraph (3): An order includescommodities valued at $8,000. The order consistsof commodities controlled under two ECCNentries, each having an LVS value limit of $5000.Commodities in the order controlled under oneECCN are valued at $3,500 while thosecontrolled under the other ECCN are valued at$4,500. Since the net value of the commoditiescontrolled under each entry falls within the LVSdollar value limits applicable to that entry, theorder may be shipped under this LicenseException.



(4) Prohibition against evasion of licenserequirements. Any activity involving the use ofthis License Exception to evade licenserequirements is prohibited. Such devices include,but are not limited to, the splitting or structuringof orders to meet applicable LVS dollar valuelimits, as prohibited by paragraphs (d)(1)(ii) and(iii) of this section.

(5) Exports and reexports of encryptioncomponents or spare parts. For components orspare parts controlled for “EI” reasons underECCN 5A002, exports and reexports under thisLicense Exception must be destined to support acommodity previously authorized for export orreexport.

(e) Reexports

Commodities may be reexported under thisLicense Exception, provided that they could beexported from the United States to the newcountry of destination under LVS.

(f) Reporting requirements

See §743.1 of the EAR for reporting requirementsfor exports of certain commodities under LicenseException LVS.

§740.4

SHIPMENTS TO COUNTRY GROUP B COUNTRIES (GBS)

License Exception GBS authorizes exports andreexports to Country Group B (see SupplementNo. 1 to part 740) of those commodities wherethe Commerce Country Chart (Supplement No. 1to part 738 of the EAR) indicates a licenserequirement to the ultimate destination fornational security reasons only and identified by“GBS - Yes” on the CCL. See §743.1 of the EARfor reporting requirements for exports of certaincommodities under License Exception GBS.

§740.5

CIVIL END-USERS (CIV)

(a) Scope

License Exception CIV authorizes exports andreexports of items on the Commerce Control List(CCL) (Supplement No. 1 to part 774 of the EAR)that have a license requirement to the ultimatedestination pursuant to the Commerce CountryChart (Supplement No. 1 to part 738 of the EAR)for NS reasons only; and identified by “CIV -Yes” in the License Exception section of the

Export Control Classification Number (ECCN),provided the items are destined to civil end-usersfor civil end-uses in Country Group D:1, exceptNorth Korea (Supplement No. 1 to part 740 ofthis part).

(b) Restrictions

(1) Restricted end-users and end-uses. You maynot use CIV if you “know” the item will be or isintended to be exported, reexported, ortransferred (in-country) to military uses ormilitary end-users. Such exports, reexports, andtransfers (in-country) will continue to require alicense. In addition to conventional militaryactivities, military uses include any proliferationactivities described and prohibited by part 744 ofthe EAR.

(2) Visa Status. Deemed exports under LicenseException CIV are not authorized to foreignnationals in an expired visa status. It is theresponsibility of the exporter to ensure that, in thecase of deemed exports, the foreign nationalmaintains a valid U.S. visa, if required to hold avisa from the United States.

(c) Reporting Requirement

See §743.1 of the EAR for reporting requirementsfor exports of certain items under this License



Exception.

(d) Foreign National Review (FNR)requirement for deemed exports

(1) Submission requirement. Prior to disclosingeligible technology to a foreign national underthis License Exception, you must submit aForeign National Review (FNR) request to BIS,as required under §748.8(s) of the EAR. YourFNR request must include information about theforeign national required under §748.8(t) of theEAR and set forth in Supplement No. 2 of part748 of the EAR.

(2) Confirmation of eligibility. You may notuse License Exception CIV until you haveobtained confirmation of eligibility by calling theSystem for Tracking Export License Applications(STELA), see §750.5 for how to use STELA, or

electronically from the Simplified NetworkAppl icat ion Procedure (SNAP), seehttp://www.bis.doc.gov/SNAP/index.htm formore information about SNAP.

(3) Action by BIS. Within nine business days ofthe registration of the FNR request, BIS will referthe FNR request electronically, along with allnecessary documentation for interagency review,or if necessary return the FNR request withoutaction (e.g., if the information provided isincomplete). Processing time starts at the point atwhich the notification is registered into BIS'selectronic system.

(4) Review by other departments or agencies.The Departments of Defense, State, Energy, andother agencies, as appropriate, may review theFNR request. Within 30 calendar days of receiptof the BIS referral, the reviewing agency willprovide BIS with a recommendation either toapprove or deny the FNR request. A reviewingagency that fails to provide a recommendationwithin 30 days shall be deemed to have noobjection to the final decision of BIS.

(5) Action on the FNR Request. After theinteragency review period, BIS will promptlynotify the applicant regarding the FNR request,i.e., whether the FNR request is approved, denied,or more time is needed to consider the request.

§740.6

TECHNOLOGY AND SOFTWARE UNDER RESTRICTION (TSR)

(a) Scope

License Exception TSR permits exports andreexports of technology and software where theCommerce Country Chart (Supplement No. 1 to part 738 of the EAR) indicates a licenserequirement to the ultimate destination fornational security reasons only and identified by“TSR - Yes” in entries on the CCL, provided thesoftware or technology is destined to CountryGroup B. (See Supplement No. 1 to part 740.) Awritten assurance is required from the consigneebefore exporting under this License Exception.

(1) Required assurance for export oftechnology. You may not export or reexporttechnology under this License Exception untilyou have received from the importer a writtenassurance that, without a BIS license or LicenseException, the importer will not:

(i) Reexport or release the technology to anational of a country in Country Groups D:1 orE:2; or

(ii) Export to Country Groups D:1 or E:2 thedirect product of the technology, if such foreignproduced direct product is subject to nationalsecurity controls as identified on the CCL (SeeGeneral Prohibition Three, §736.2(b)(3) of theEAR); or

(iii) If the direct product of the technology is acomplete plant or any major component of a

http://www.bis.doc.gov/SNAP/index.htm



plant, export to Country Groups D:1 or E:2 thedirect product of the plant or major componentthereof, if such foreign produced direct product issubject to national security controls as identifiedon the CCL or is subject to State Departmentcontrols under the U.S. Munitions List (22 CFRpart 121).

(2) Required assurance for export of software.You may not export or reexport software underthis License Exception until you have receivedfrom the importer a written assurance that,without a BIS license or License Exception, theimporter will neither:

(i) Reexport or release the software or thesource code for the software to a national of acountry in Country Groups D:1 or E:2; nor

(ii) Export to Country Groups D:1 or E:2 thedirect product of the software, if such foreignproduced direct product is subject to nationalsecurity controls as identified on the CCL. (SeeGeneral Prohibition Three, §736.2(b)(3) of theEAR).

(3) Form of written assurance. The requiredassurance may be made in the form of a letter orany other written communication from theimporter, including communications viafacsimile, or the assurance may be incorporatedinto a licensing agreement that specificallyincludes the assurances. An assurance includedin a licensing agreement is acceptable only if theagreement specifies that the assurance will behonored even after the expiration date of thelicensing agreement. If such a written assuranceis not received, License Exception TSR is notapplicable and a license is required. The licenseapplication must include a statement explainingwhy assurances could not be obtained.

(4) Other License Exceptions. The requirementsin this License Exception do not apply to theexport of technology or software under otherLicense Exceptions, or to the export of

technology or software included in an applicationfor the foreign filing of a patent, provided thefiling is in accordance with the regulations of theU.S. Patent Office.

(b) Reporting requirements

See §743.1 of the EAR for reporting requirementsfor exports of certain items under LicenseException TSR. Note that reports are notrequired for release of technology or source codesubject to the EAR to foreign nationals in theU.S. under the provisions of License ExceptionTSR.

§740.7

COMPUTERS (APP)

(a) Scope

(1) Commodities. License Exception APPauthorizes exports and reexports of computers,including “electronic assemblies” and speciallydesigned components therefor controlled byECCN 4A003, except ECCN 4A003.e (equipmentperforming analog-to-digital conversionsexceeding the limits in ECCN 3A001.a.5.a),exported or reexported separately or as part of asystem for consumption in Computer Tiercountries as provided by this section. Whenevaluating your computer to determine LicenseException APP eligibility, use the APP parameterto the exclusion of other technical parameters inECCN 4A003.

(2) Technology and software. LicenseException APP authorizes exports of technologyand software controlled by ECCNs 4D001 and4E001 specially designed or modified for the“development”, “production”, or “use” ofcomputers, including “electronic assemblies” andspecially designed components therefor classifiedin ECCN 4A003, except ECCN 4A003.e(equipment performing analog-to-digital



conversions exceeding the limits in ECCN3A001.a.5.a), to Computer Tier countries asprovided by this section.

(b) Restrictions

(1) Related equipment controlled under ECCN4A003.g may not be exported or reexported underthis License Exception when exported orreexported separately from eligible computersauthorized under this License Exception.

(2) Access and release restrictions.

(i) Computers and software. Computers andsoftware eligible for License Exception APP maynot be accessed either physically orcomputationally by nationals of Cuba, Iran,North Korea, Sudan, or Syria, except thatcommercial consignees described in SupplementNo. 3 to part 742 of the EAR are prohibited onlyfrom giving such nationals user-accessibleprogrammability.

(ii) Technology and source code. Technologyand source code eligible for License ExceptionAPP may not be released to nationals of Cuba,Iran, North Korea, Sudan, or Syria.

(3) Computers and software eligible for LicenseException APP may not be reexported ortransferred (in country) without priorauthorization from BIS, i.e., a license, apermissive reexport, another License Exception,or “No License Required”. This restriction mustbe conveyed to the consignee, via the DestinationControl Statement, see §758.6 of the EAR.Additionally, the end-use and end-userrestrictions in paragraph (b)(5) of this sectionmust be conveyed to any consignee in ComputerTier 3.

(4) You may not use this License Exception toexport or reexport items that you know will beused to enhance the APP beyond the eligibilitylimit allowed to your country of destination.

(5) License Exception APP does not authorizeexports, reexports and transfers (in-country) fornuclear, chemical, biological, or missile end-usersand end-uses subject to license requirementsunder §744.2, §744.3, §744.4, and §744.5 of theEAR. Such exports, reexports and transfers (in-country) will continue to require a license andwill be considered on a case-by-case basis. Reexports and transfers (in-country) to these end-users and end-uses in eligible countries arestrictly prohibited without prior authorization.

(6) Foreign nationals in an expired visa status arenot eligible to receive deemed exports oftechnology or source code under this LicenseException. It is the responsibility of the exporterto ensure that, in the case of deemed exports, theforeign national maintains a valid U.S. visa, ifrequired to hold a visa from the United States.

(c) Computer Tier 1 destinations

(1) Eligible destinations. The destinations thatare eligible to receive exports and reexports underparagraph (c) of this section include: Antiguaand Barbuda, Argentina, Aruba, Australia,Austria, Bahamas (The), Bangladesh, Barbados,Belgium, Belize, Benin, Bhutan, Bolivia,Botswana, Brazil, Brunei, Bulgaria, Burkina Faso,Burundi, Cameroon, Cape Verde, Central AfricanRepublic, Chad, Chile, Colombia, Congo(Democratic Republic of the), Congo (Republicof the), Costa Rica, Cote d'Ivoire, Cyprus, CzechRepublic, Denmark, Dominica, DominicanRepublic, East Timor, Ecuador, El Salvador,Equatorial Guinea, Eritrea, Estonia, Ethiopia, Fiji,Finland, France, Gabon, Gambia (The), Germany,Ghana, Greece, Grenada, Guatemala, Guinea,Guinea-Bissau, Guyana, Haiti, Honduras, HongKong, Hungary, Iceland, Indonesia, Ireland, Italy,Jamaica, Japan, Kenya, Kiribati, Korea (Republicof), Latvia, Lesotho, Liberia, Liechtenstein,Lithuania, Luxembourg, Madagascar, Malawi,Malaysia, Maldives, Mali, Malta, MarshallIslands, Mauritius, Mexico, Micronesia(Federated States of), Monaco, Mozambique,



Namibia, Nauru, Nepal, Netherlands, NetherlandsAntilles, New Zealand, Nicaragua, Niger,Nigeria, Norway, Palau, Panama, Papua NewGuinea, Paraguay, Peru, Philippines, Poland,Portugal, Romania, Rwanda, St. Kitts & Nevis,St. Lucia, St. Vincent and the Grenadines, SaoTome & Principe, Samoa, San Marino, Senegal,Seychelles, Sierra Leone, Singapore, Slovakia,Slovenia, Solomon Islands, Somalia, SouthAfrica, Spain, Sri Lanka, Surinam, Swaziland,Sweden, Switzerland, Taiwan, Tanzania, Togo,Tonga, Thailand, Trinidad and Tobago, Turkey,Tuvalu, Uganda, United Kingdom, Uruguay,Vatican City, Venezuela, Western Sahara,Zambia, and Zimbabwe.

(2) Eligible commodities. All computers,including electronic assemblies and speciallydesigned components therefor are eligible forexport or reexport under License Exception APPto Tier 1 destinations, subject to the restrictions inparagraph (b) of this section.

(3) Eligible technology and software.

(i) Technology and software described inparagraph (a)(2) of this section for computers ofunlimited APP are eligible for export or reexportunder License Exception APP to: Australia,Austria, Belgium, Canada, Denmark, Finland,France, Germany, Greece, Ireland, Italy, Japan,Luxembourg, Netherlands, New Zealand,Norway, Portugal, Spain, Sweden, Switzerland,Turkey, or the United Kingdom; and

(ii) “Development” and “production”technology and source code described inparagraph (a)(2) of this section for computerswith a APP less than or equal to 0.1 WeightedTeraFLOPS (WT) are eligible for deemed exportsunder License Exception APP to foreign nationalsof Tier 1 destinations, other than the destinationsthat are listed in paragraph (c)(3)(i) of thissection, subject to the restrictions in paragraph (b)of this section.

(iii) “Use” technology and source codedescribed in paragraph (a)(2) of this section forcomputers with a APP less than or equal to 0.75WT are eligible for deemed exports underLicense Exception APP to foreign nationals ofTier 1 destinations, other than the destinationsthat are listed in paragraph (c)(3)(i) of thissection, subject to the restrictions in paragraph (b)of this section.

(d) Computer Tier 3 destinations

(1) Eligible destinations. Eligible destinationsunder paragraph (d) of this section are:Afghanistan, Albania, Algeria, Andorra, Angola,Armenia, Azerbaijan, Bahrain, Belarus, Bosnia &Herzegovina, Burma, Cambodia, China (People'sRepublic of), Comoros, Croatia, Djibouti, Egypt,Georgia, India, Iraq, Israel, Jordan, KazakhstanKosovo, Kuwait, Kyrgyzstan, Laos, Lebanon,Libya, Macau, Macedonia (The Former YugoslavRepublic of), Mauritania, Moldova, Mongolia,Montenegro, Morocco, Oman, Pakistan, Qatar,Russia, Saudi Arabia, Serbia, Tajikistan, Tunisia,Turkmenistan, Ukraine, United Arab Emirates,Uzbekistan, Vanuatu, Vietnam, and Yemen.

(2) Eligible commodities. None.

(3) Eligible technology and source code.

(i) “Development,” and “production”technology and source code described inparagraph (a)(2) of this section for computerswith a APP less than or equal to 0.1 WeightedTeraFLOPS (WT) are eligible for deemedexports under License Exception APP to foreignnationals of Tier 3 destinations as described inparagraph (d)(1) of this section, subject to therestrictions in paragraph (b) and the provisions ofparagraph (d)(4) of this section.

(ii) “Use” technology and source codedescribed in paragraph (a)(2) of this section forcomputers with an APP less than or equal to 0.75WT are eligible for deemed exports under



License Exception APP to foreign nationals ofTier 3 destinations as described in paragraph(d)(1) of this section, subject to the restrictions inparagraph (b) and the provisions of paragraph(d)(4) of this section.

(4) Foreign National Review (FNR)requirement for deemed exports.

(i) Submission requirement. Prior todisclosing eligible technology or source code to aforeign national of a Computer Tier 3 country thatis not also a country listed in Country Group B inSupplement No. 1 to part 740 of the EAR underthis License Exception, you must submit aForeign National Review (FNR) request to BIS,as required under §748.8(s) of the EAR. YourFNR request must include information about theforeign national required under §748.8(t) of theEAR and set forth in Supplement No. 2 of part748 of the EAR.

(ii) Confirmation of eligibility. You may notuse License Exception APP, until you haveobtained confirmation of eligibility by calling theSystem for Tracking Export License Applications(STELA), see §750.5 for how to use STELA, orelectronically from the Simplified NetworkApplication Procedure (SNAP), seehttp://www.bis.doc.gov/SNAP/index.htm formore information about SNAP.

(iii) Action by BIS. Within nine business daysof the registration of the FNR request, BIS willelectronically refer the FNR request forinteragency review, or if necessary return theFNR request without action (e.g., if theinformation provided is incomplete). Processingtime starts at the point at which the notification isregistered into BIS's electronic system.

(iv) Review by other departments or agencies.The Departments of Defense, State, Energy, andother agencies, as appropriate, may review theFNR request. Within 30 calendar days of receiptof the BIS referral, the reviewing agency will

provide BIS with a recommendation either toapprove or deny the FNR request. A reviewingagency that fails to provide a recommendationwithin 30 days shall be deemed to have noobjection to the final decision of BIS.

(v) Action on the FNR Request. After theinteragency review period, BIS will promptlynotify the applicant regarding the FNR request,i.e., whether the FNR request is approved, denied,or more time is needed to consider the request.

(e) Reporting requirements

See §743.1 of the EAR for reporting requirementsof certain items under License Exception APP.

§740.8 [RESERVED]

§740.9

TEMPORARY IMPORTS, EXPORTS, AND REEXPORTS (TMP)

This License Exception authorizes varioustemporary exports and reexports; exports andreexports of items temporarily in the UnitedStates; and exports and reexports of beta testsoftware.

(a) Temporary exports

(1) Scope. You may export and reexportcommodities and software for temporary useabroad (including use in international waters)subject to the conditions and restrictionsdescribed in paragraphs (a)(2) through (a)(5) ofthis section. U.S. persons, as defined inparagraph (a)(2)(i)(C), may export and reexporttechnology for temporary use abroad underparagraph (a)(2)(i) of this section to U.S. personsor their employees traveling or temporarilyassigned abroad (including use in internationalwaters) subject to the conditions and restrictions

http://www.bis.doc.gov/SNAP/index.htm



described in paragraphs (a)(2) through (a)(5) ofthis section. Paragraph (a) does not authorize anynew release of technology. Persons receivingtechnology exported or reexported underparagraph (a)(2)(i) must already be authorized toreceive the same technology in accordance withthe EAR (e.g., through a license or licenseexception), or, alternatively, not require suchauthorization on account of the technology’s NLRstatus. Technology exports and reexportsauthorized under this paragraph (a) may be madeas actual shipments, transmissions, or releases.Exports and reexports of encryption itemscontrolled under ECCN 5E002 are not permittedpursuant to this paragraph (a). Items shipped astemporary exports and reexports under theprovisions of this paragraph (a) must be returnedto the country from which they were exported orreexported as soon as practicable but, except incircumstances described in this section, no laterthan one year from the date of export or reexport.This requirement does not apply if the items areconsumed or destroyed in the normal course ofauthorized temporary use abroad or an extensionor other disposition is permitted by the EAR or inwriting by BIS.

(i) Additional requirement for return ordisposal of technology. Technology shipped ortransmitted as a temporary export or reexportunder the provisions of this paragraph (a)(2)(i)(A)that exists in a format that could facilitate asubsequent release of the technology must bereturned or disposed of in accordance withparagraph (a)(4) of this section. Examples oftechnology that exists in a format that couldfacilitate a subsequent release of technologyinclude the following: technology in a hard copyformat (e.g. blue prints, manuals); technology inan electronic format stored on an electronicdevice (e.g. laptop, PDA); or technology storedon removable storage media and devices (e.g.CD-ROMS, flash drives, video cassettes).

(ii) [RESERVED]

(2) Eligible items. The following items areeligible to be shipped under this paragraph (a):

(i) Tools of trade. Usual and reasonable kindsand quantities of tools of trade (commodities,software, and technology) for use in a lawfulenterprise or undertaking of the exporter. For theexport or reexport of commodities or software,the transaction must meet the requirements ofparagraph (a)(2)(i)(A) or paragraph (a)(2)(i)(B) ofthis section. For the export or reexport by U.S.persons of technology authorized under thisparagraph, the transaction must meet therequirements of paragraph (a)(2)(i)(A) of thissection.

(A) Destinations other than Country GroupE:2 or Sudan. Exports and reexports of tools oftrade for use by the exporter or employees of theexporter may be made only to destinations otherthan Country Group E:2 or Sudan. The tools oftrade must remain under the “effective control”(see §772.1 of the EAR) of the exporter or theexporter's employee. Eligible tools of trade mayinclude, but are not limited to, equipment andsoftware as is necessary to commission or serviceitems, provided that the equipment or software isappropriate for this purpose and that all items tobe commissioned or serviced are of foreignorigin, or if subject to the EAR, have beenlawfully exported or reexported. For exports andreexports by U.S. persons to U.S. persons or theiremployees traveling or temporarily assignedabroad, eligible tools of trade may also include,but are not limited to, technology as is necessaryto commission or service items, provided that allitems to be commissioned or serviced either areof foreign origin and not subject to the EAR, or, ifsubject to the EAR, have been lawfully exportedor reexported. Tools of trade may accompany theindividual departing from the United States ormay be shipped unaccompanied within one monthbefore the individual’s departure from the UnitedStates, or at any time after departure.



(B) Sudan. Exports or reexports of tools oftrade may be made to Sudan as authorized by thisparagraph.

(1) Permissible users of this provision.A non-governmental organization or an individualstaff member, employee or contractor of suchorganization traveling to Sudan at the direction orwith the knowledge of such organization mayexport or reexport under this paragraph.

(2) Authorized purposes. Any tools oftrade exported or reexported under this paragraphmust be used to support activities to implementthe Darfur Peace Agreement or theComprehensive Peace Agreement, to providehumanitarian or development assistance in Sudanto support activities to relieve human suffering inSudan by an organization registered by theDepartment of the Treasury, Office of ForeignAssets Control (OFAC) pursuant to 31 CFR§538.521, to support the actions in Sudan forhumanitarian or development purposes by anorganization authorized by OFAC to take suchactions that would otherwise would be prohibitedby the Sudanese Sanctions Regulations (31 CFRpart 538), or to support the activities to relievehuman suffering in Sudan in areas that are exemptfrom the Sudanese Sanctions Regulations byvirtue of the Darfur Peace and Accountability Actand Executive Order 13412.

(3) Method of export and maintenanceof control. The tools of trade must accompany(either hand carried or as checked baggage) atraveler who is a permissible user of thisprovision or be shipped or transmitted to aneligible user of this provision by a methodreasonably calculated to assure delivery to thepermissible user of this provision. Thepermissible user of this provision must maintain“effective control” (See §772.1 of the EAR) ofthe tools of trade while in Sudan.

(4) The only tools of trade that may beexported to Sudan under this paragraph

(a)(2)(i)(B) are:

(i) Commodities controlled underECCNs 4A994.b (not exceeding an adjusted peakperformance of 0.008 weighted teraFLOPS),4A994.d, 4A994.e (other than industrialcontrollers for chemical processing), 4A994.g and4A994.h and “software” controlled under ECCNs4D994 or 5D992 to be used on such commodities.Software must be loaded onto such commoditiesprior to export or reexport or be exported orreexported solely for servicing or in-kindreplacement of legally exported or reexportedsoftware. All such software must remain loadedon such commodities while in Sudan;

(ii) Telecommunications equipmentcontrolled under ECCN 5A991 and “software”controlled under ECCN 5D992 to be used in theoperation of such equipment. Software must beloaded onto such equipment prior to export or beexported or reexported solely for servicing orin-kind replacement of legally exported orreexported software. All such software mustremain loaded on such equipment while in Sudan;

(iii) Global positioning systems(GPS) or similar satellite receivers controlledunder ECCN 7A994; and

(iv) Parts and components that arecontrolled under ECCN 5A992, that are installedwith, or contained in, commodities in paragraphs(a)(2)(i)(B)(4)(i) and (ii) of this section and thatremain installed with or contained in suchcommodities while in Sudan.

(C) For purposes of this paragraph (a)(2)(i),U.S. person is defined as follows: an individualwho is a citizen of the United States, anindividual who is a lawful permanent resident asdefined by 8 U.S.C. 1101(a)(2) or an individualwho is a protected individual as defined by 8U.S.C. 1324b(a)(3). U.S. person also means anyjuridical person organized under the laws of theUnited States, or any jurisdiction within the



United States (e.g., corporation, businessassociation, partnership, society, trust, or anyother entity, organization or group that isincorporated to do business in the United States).

(ii) Kits consisting of replacement parts. Kitsconsisting of replacement parts may be exportedor reexported to all destinations, except CountryGroup E:2 (see Supplement No. 1 to part 740),provided that:

(A) The parts would qualify for shipmentunder paragraph (a)(2)(ii)(C) of this section ifexported as one-for-one replacements;

(B) The kits remain under effective controlof the exporter or an employee of the exporter;and

(C) All parts in the kit are returned, exceptthat one-for-one replacements may be made inaccordance with the requirements of LicenseException RPL and the defective parts returned(see “parts”, §740.10(a) of this part).

(iii) Exhibition and demonstration. You mayexport or reexport under this provisioncommodities and software for exhibition ordemonstration in all countries except countrieslisted in Country Group E:1 (see Supplement No.1 to this part) provided that the exporter maintainsownership of the commodities and software whilethey are abroad and provided that the exporter, anemployee of the exporter, or the exporter'sdesignated sales representative retains “effectivecontrol” over the commodities and software whilethey are abroad (see part 772 of the EAR for adefinition of “effective control”). Thecommodities and software may not be used fortheir intended purpose while abroad, except to theminimum extent required for effectivedemonstration. The commodities and softwaremay not be exhibited or demonstrated at any onesite more than 120 days after installation anddebugging, unless authorized by BIS. However,before or after an exhibition or demonstration,

pending movement to another site, return to theUnited States or the foreign reexporter, or BISapproval for other disposition, the commoditiesand software may be placed in a bondedwarehouse or a storage facility provided that theexporter retains effective control over theirdisposition. The export documentation for thistype of transaction must show the exporter asultimate consignee, in care of the person who willhave control over the commodities and softwareabroad.

(iv) Inspection and calibration. Commoditiesto be inspected, tested, calibrated or repairedabroad may be exported or reexported to alldestinations under this section, except CountryGroup E:2, Sudan or Syria.

(v) Containers. Containers for which anotherLicense Exception is not available and that arenecessary for export of commodities. However,this License Exception does not authorize theexport of the container's contents, which, if notexempt from licensing, must be separatelyauthorized for export under either a LicenseException or a license.

(vi) Broadcast material.

(A) Video tape containing program materialrecorded in the country of export to be publiclybroadcast in another country.

(B) Blank video tape (raw stock) for use inrecording program material abroad.

(vii) Assembly in Mexico. Commodities to beexported to Mexico under Customs entries thatrequire return to the United States afterprocessing, assembly, or incorporation into endproducts by companies, factories, or facilitiesparticipating in Mexico's in-bond industrializationprogram (Maquiladora), provided that allresulting end-products (or the commoditiesthemselves) are returned to the United States.



(viii) News media.

(A) Commodities necessary fornews-gathering purposes (and software necessaryto use such commodities) may accompany“accredited” news media personnel (i.e., personswith credentials from a news gathering orreporting firm) to Country Groups D:1 or E:2, orSudan (see Supplement No. 1 to part 740) if thecommodities:

(1) Are retained under “effective control”of the exporting news gathering firm;

(2) Remain in the physical possession ofthe news media personnel. The term physicalpossession for purposes of this paragraph(a)(2)(viii), news media, is defined as maintainingeffective measures to prevent unauthorized access(e.g., securing equipment in locked facilities orhiring security guards to protect the equipment);and

(3) Are removed with the news mediapersonnel at the end of the trip.

(B) When exporting under this paragraph(a)(2)(viii) from the United States, the exportermust send a copy of the packing list or similaridentification of the exported commodities, to:

U.S. Department of CommerceBureau of Industry and SecurityOffice of Export Enforcement, Room H461614th Street and Constitution Avenue, N.W.Washington, DC 20230

or any of its field offices, specifying thedestination and estimated dates of departure andreturn. The Office of Export Enforcement (OEE)may spot check returns to assure that thetemporary exports and reexports provisions ofthis License Exception are being used properly.

(C) Commodities or software necessary fornews-gathering purposes that accompany news

media personnel to all other destinations shall beexported or reexported under paragraph (a)(2)(i),tools of trade, of this section if owned by thenews gathering firm, or if they are personalproperty of the individual news media personnel.Note that paragraphs (a)(2)(i), tools of trade and(a)(2)(viii), news media, of this section do notpreclude independent “accredited” contractpersonnel, who are under control of newsgathering firms while on assignment, fromutilizing these provisions, provided that the newsgathering firm designate an employee of thecontract firm to be responsible for the equipment.

(ix) Temporary exports to a U.S. subsidiary,affiliate or facility in Country Group B.

(A) Components, parts, tools or testequipment exported by a U.S. person to itssubsidiary, affiliate or facility in a country listedin Country Group B (see Supplement No. 1 to thispart) that is owned or controlled by the U.S.person, if the components, part, tool or testequipment is to be used for manufacture,assembly, testing, production or modification,provided that no components, parts, tools or testequipment or the direct product of suchcomponents, parts, tools or test equipment aretransferred (in-country) or reexported from suchsubsidiary, affiliate or facility without priorauthorization by BIS.

(B) For purposes of this paragraph(a)(2)(ix), U.S. person is defined as follows: anindividual who is a citizen of the United States,an individual who is a lawful permanent residentas defined by 8 U.S.C. 1101(a)(2) or an individualwho is a protected individual as defined by 8U.S.C. 1324b(a)(3). U.S. person also means anyjuridical person organized under the laws of theUnited States, or any jurisdiction within theUnited States (e.g., corporation, businessassociation, partnership, society, trust, or anyother entity, organization or group that isincorporated to do business in the United States).



(3) Special restrictions.

(i) Destinations.

(A) No item may be exported or reexportedunder paragraph (a) of this section to CountryGroup E:2 (see Supplement No. 1 to this part)except as permitted by paragraph (a)(2)(viii) ofthis section (news media). These destinationrestrictions apply to temporary exports to and foruse on any vessel, aircraft or territory under theownership, control, lease, or charter by anycountry in Country Group E:2, or any nationalthereof;

(B) No item may be exported under thisLicense Exception to Country Group D:1 (seeSupplement No. 1 to part 740) except:

(1) Commodities and software exportedunder paragraph (a)(2)(viii), news media, of thissection;

(2) Items exported under paragraph(a)(2)(i), tools of trade, of this section;

(3) Commodities exported or reexportedas kits of consisting of replacement parts,consistent with the requirements of paragraph(a)(2)(ii) of this section; and

(4) Commodities and software exportedor reexported for exhibition and demonstration inaccordance with the requirements of paragraph(a)(2)(iii) of this section.

(C) These destination restrictions apply totemporary exports to and for use on any vessel,aircraft or territory under ownership, control,lease, or charter by any country in Country GroupD:1 or E:2, or any national thereof. (SeeSupplement No. 1 to part 740.)

(ii) Ineligible items.

(A) Items that will be used outside of

Country Group A:1 (see Supplement No. 1 to part740), Iceland, or New Zealand, either directly orindirectly, in any sensitive nuclear activity asdescribed in §744.2 of the EAR may not beexported or reexported to any destination underthe temporary exports and reexports provisions ofthis License Exception.

(B) Exports and reexports of encryptionitems controlled under ECCN 5E002 are not permitted pursuant to this paragraph (a).

(iii) Use or disposition. No item may beexported or reexported under this paragraph (a) if:

(A) An order to acquire the item has beenreceived before shipment;

(B) The exporter has prior knowledge thatthe item will stay abroad beyond the terms of thisLicense Exception; or

(C) The item is for lease or rental abroad.

(iv) Restrictions specific to the export orreexport of technology. The authorization for theexport or reexport of technology under the toolsof trade provisions of paragraph (a)(2)(i)(A) issubject to the restrictions in this paragraph(a)(3)(iv), as described in paragraphs(a)(3)(iv)(A), (a)(3)(iv)(B) and (a)(3)(iv)(C).

(A) The authorization for the export orreexport of technology under the tools of tradeprovisions of paragraph (a)(2)(i)(A) of thissection may be used only by U.S. persons, asdefined in (a)(2)(i)(C), or their employeestraveling or on temporary assignment abroad.The restrictions under this paragraph (a)(3)(iv)(A)include the following three additional restrictions:

(1) Employees who are not U.S. persons,as defined in (a)(2)(i)(C), may be authorized toreceive exports or reexports of the technologyeligible for export or reexport under the tools oftrade provisions of paragraph (a)(2)(i)(A), only if



such employees are already eligible to receivesuch technology through a current license or alicense exception or on account of NLR status;

(2) A U.S. employer of individuals whoare not U.S. persons, as defined in (a)(2)(i)(C),must demonstrate and document forrecordkeeping purposes the reason that thetechnology to be authorized for export or reexportunder the tools of trade provisions of paragraph(a)(2)(i)(A) is needed by such employees in theirtemporary business activities abroad on behalf ofthe U.S. person employer, prior to using the toolsof trade provisions of paragraph (a)(2)(i)(A) ofthis section. This documentation must be createdand maintained in accordance with therecordkeeping requirements of part 762 of theEAR; and

(3) The U.S. person must retainsupervision over the technology that has beenauthorized for export or reexport under these orother provisions.

(B) The exporting or reexporting party and therecipient of the technology must take securityprecautions to protect against unauthorizedrelease of the technology while the technology isbeing shipped or transmitted and used overseas.Examples of security precautions to help preventunauthorized access include the following:

(1) Use of secure connections, such asVirtual Private Network connections, whenaccessing IT networks for e-mail and otherbusiness activities that involve the transmissionand use of the technology authorized under thislicense exception;

(2) Use of password systems on electronicdevices that will store the technology authorizedunder this license exception; and

(3) Use of personal firewalls on electronicdevices that will store the technology authorizedunder this license exception.

(C) Technology authorized under theseprovisions may not be used for foreign productionpurposes or for technical assistance unlessauthorized by BIS.

(4) Return or disposal of items. All itemsexported or reexported under these provisionsmust, if not consumed or destroyed in the normalcourse of authorized temporary use abroad, bereturned as soon as practicable but no later thanone year after the date of export or reexport, tothe United States or other country from which theitems were so exported or reexported, or shall bedisposed of or retained in one of the followingways:

(i) Permanent export or reexport. If theexporter or the reexporter wishes to sell orotherwise dispose of the items abroad, except aspermitted by this or other applicable provision ofthe EAR, the exporter or reexporter must requestauthorization by submitting a license applicationto BIS in accordance with §§ 748.1, 748.4 and748.6 of the EAR. (See part 748 of the EAR formore information on license applications.) Therequest should comply with all applicableprovisions of the EAR covering export directlyfrom the United States to the proposeddestination. The request must also be supportedby any documents that would be required insupport of an application for export license forshipment of the same items directly from theUnited States to the proposed destination. BISwill advise the exporter of its decision.

(ii) Use of a license. An outstanding licensemay also be used to dispose of items covered bythe provisions of this paragraph (a), provided thatthe outstanding license authorizes direct shipmentof the same items to the same new ultimateconsignee in the new country of destination.

(iii) Authorization to retain item abroadbeyond one year. If the exporter wishes to retainan item abroad beyond the 12 months authorizedby paragraph (a) of this section, the exporter must



request authorization by submitting a licenseapplication in accordance with §§ 748.1, 748.4and 748.6 of the EAR to BIS 90 days prior to theexpiration of the 12 month period. The requestmust be sent to BIS at the address listed in part748 of the EAR and should include the name andaddress of the exporter, the date the items wereexported, a brief product description, and thejustification for the extension. If BIS approvesthe extension request, the exporter will receiveauthorization for a one-time extension not toexceed six months. BIS normally will not allowan extension for items that have been abroadmore than 12 months, nor will a second six monthextension be authorized. Any request forretaining the items abroad for a period exceeding18 months must be made in accordance with therequirements of paragraph (a)(4)(i) of thissection.

(5) Reexports.

(i) Commodities and software lawfullyexported from the United States may bereexported to a new country or countries ofdestination other than Sudan or Country GroupE:2 under provisions of this paragraph (a)provided its terms and conditions are met and thecommodities and software are returned to thecountry from which the reexport occurred.

(ii) Technology legally exported from theUnited States may be reexported by a U.S. personto U.S. persons and their employees in a newcountry or countries of destination other thanSudan or Country Group E:2 under provisions ofthis paragraph (a)(2)(i)(A) provided its terms andconditions are met and the technology is returnedto the country from which the reexport occurred.

(b) Exports of items temporarily in the United States

Scope. The provisions of this paragraph (b)describe the conditions for exporting foreign-

origin items temporarily in the United States. Theprovisions include the export of items moving intransit through the United States, imported fordisplay at a U.S. exhibition or trade fair, returnedbecause unwanted, or returned because refusedentry.

NOTE 1 to paragraph (b) of this section: Acommodity withdrawn from a bonded warehousein the United States under a “withdrawal forexport” customs entry is considered as “movingin transit”. It is not considered as “moving intransit” if it is withdrawn from a bondedwarehouse under any other type of customs entryor if its transit has been broken for a processingoperation, regardless of the type of customs entry.

NOTE 2 to paragraph (b) of this section:Items shipped on board a vessel or aircraft andpassing through the United States from oneforeign country to another may be exportedwithout a license provided that (a) while passingin transit through the United States, they have notbeen unladen from the vessel or aircraft on whichthey entered, and (b) they are not originallymanifested to the United States.

(1) Items moving in transit through the UnitedStates. Subject to the following conditions, theprovisions of paragraph (b)(1) authorize export ofitems moving in transit through the United Statesunder a Transportation and Exportation (T.& E.)customs entry or an Immediate Exportation (I.E.)customs entry made at a U.S. Customs Office.

(i) Items controlled for national securityreasons, nuclear proliferation reasons, chemicaland biological weapons reasons or missiletechnology reasons may not be exported toCountry Group D:1, 2, 3, or 4 (see SupplementNo. 1 to part 740), respectively, under thisparagraph (b)(1).

(ii) Items may not be exported to CountryGroup E:2 or Sudan under this section.



(iii) The following may not be exported intransit from the United States under thisparagraph (b)(1):

(A) Commodities shipped to the UnitedStates under an International Import Certificate,Form BIS-645P;

(B) Chemicals controlled under ECCN1C350; or

(C) Horses for export by sea (refer to shortsupply controls in part 754 of the EAR).

(iv) The provisions of this paragraph (b)(1)apply to all shipments from Canada moving intransit through the United States to any foreigndestination, regardless of the nature of thecommodities or software or their origin. For suchshipments the customs office at the U.S. port ofexport will require a copy of Form B-13,Canadian Customs Entry, certified or stamped byCanadian customs authorities, except where theshipment is valued at less than $50.00. (In transitshipments originating in Canada that are exemptfrom U.S. licensing, or made under a U.S. licenseor applicable other U.S. License Exception do notrequire this form.) The commodity or softwaredescription, quantity, ultimate consignee, countryof ultimate destination, and all other pertinentdetails of the shipment must be the same on arequired Form B-13, as on Commerce Form7513, or when Form 7513 is not required, must1

be the same as on Customs Form 7512. Whenthere is a material difference, a corrected FormB-13 authorizing the shipment is required.

(2) Items imported for display at U.S.exhibitions or trade fairs. Subject to thefollowing conditions, the provisions of this

paragraph (b)(2) authorize the export of items thatwere imported into the United States for displayat an exhibition or trade fair and were eitherentered under bond or permitted temporary freeimport under bond providing for their export andare being exported in accordance with the termsof that bond.

(i) Items may be exported to the country fromwhich imported into the United States. However,items originally imported from Cuba may not beexported unless the U.S. Government hadlicensed the import from that country.

(ii) Items may be exported to any destinationother than the country from which importedexcept:

(A) Items imported into the United Statesunder an International Import Certificate;

(B) Exports to Country Group E:2 or Sudan(see Supplement No. 1 to part 740); or

(C) Exports to Country Group D:1, 2, 3, or4 (see Supplement No. 1 to part 740) of itemscontrolled for national security reasons, nuclearnonproliferation reasons, chemical and biologicalweapons reasons or missile technology reasons,respectively.

(3) Return of unwanted shipments. A foreign-origin item may be returned under this LicenseException to the country from which it wasimported if its characteristics and capabilitieshave not been enhanced while in the UnitedStates. No foreign-origin items may be returnedto Cuba.

(4) Return of shipments refused entry.Shipments of items refused entry by the U.S.Customs Service, the Food and DrugAdministration, or other U.S. Government agencymay be returned to the country of origin, exceptto:

The complete names of these forms are: Commerce 1

Form 7513, “Shipper's Export Declaration for In-

transit Goods”; Customs Form 7512, “Transportation

Entry and Manifest of Goods Subject to Customs In-

spection and Permit”.



(i) A destination in Cuba; or

(ii) A destination from which the shipment hasbeen refused entry because of the Foreign AssetsControl Regulations of the Treasury Department,unless such return is licensed or otherwiseauthorized by the Treasury Department, Office ofForeign Assets Control (31 CFR part 500).

(c) Exports of beta test software

(1) Scope. The provisions of this paragraph (c)authorize exports and reexports to eligiblecountries of beta test software intended fordistribution to the general public.

(2) Eligible countries. Encryption software controlled under ECCN 5D002 is not eligible forexport or reexport to country in Country GroupE:1 under the provisions of this paragraph (c). All other beta test software is eligible for exportor reexport to all destinations, except Cuba, Iran,and Sudan under the provisions of this paragraph (c).

(3) Eligible software. All software that iscontrolled by the Commerce Control List(Supplement No.1 to part 774 of the EAR), andunder Commerce licensing jurisdiction, is eligiblefor export and reexport, subject to the restrictionsof this paragraph (c). Encryption softwarecontrolled for “EI” reasons under ECCN 5D002 iseligible for export and reexport under thisparagraph (c), provided that the exporter hassubmitted the information described in paragraph(c)(8) of this section by the time of export. Finalencryption products produced by the testingconsignee are subject to any applicable provisionsin §742.15(b) of the EAR (for mass marketencryption commodities and software withsymmetric key length exceeding 64-bits) or§740.17 of the EAR (License Exception ENC),including review and reporting requirements.

(4) Conditions for use. Exports or reexports ofbeta test software programs under the provisions

of this paragraph (c) must meet all of thefollowing conditions:

(i) The software producer intends to market thesoftware to the general public after completion ofthe beta testing, as described in the GeneralSoftware Note (see Supplement No. 2 to part 774of the EAR) or the Cryptography Note inCategory 5, Part 2 (“Information Security”), ofthe Commerce Control List (see Supplement No.1to part 774 of the EAR);

(ii) The software producer provides thesoftware to the testing consignee free-of-charge orat a price that does not exceed the cost ofreproduction and distribution; and

(iii) The software is designed for installationby the end-user without further substantialsupport from the supplier.

(5) Importer Statement. Prior to exporting orreexporting any eligible software under thisparagraph (c), the exporter or reexporter mustobtain the following statement from the testingconsignee, which may be included in a contract,non-disclosure agreement, or other document thatidentifies the importer, the software to beexported, the country of destination, and thetesting consignee.

“We certify that this beta test software willonly be used for beta testing purposes, andwill not be rented, leased, sold, sublicensed,assigned, or otherwise transferred. Further,we certify that we will not transfer or exportany product, process, or service that is thedirect product of the beta test software.”

(6) Use limitations. Only testing consignees thatprovide the importer statement required byparagraph (c)(5) of this section may execute anysoftware that was exported or reexported to themunder the provisions of this paragraph (c).

(7) Return or disposal of software. All beta



test software exported must be destroyed abroador returned to the exporter within 30 days of theend of the beta test period as defined by thesoftware producer or, if the software producerdoes not define a test period, within 30 days ofcompletion of the consignee's role in the test.Among other methods, this requirement may besatisfied by a software module that will destroythe software and all its copies at or before the endof the beta test period.

(8) Notification of beta test encryption software.

For beta test encryption software eligible underthis license exception you must, by the time ofexport or reexport, submit the informationdescribed in paragraphs (a) through (e) ofSupplement No. 6 to part 742 of the EAR by e-mail to BIS at [email protected] and to the ENCEncryption Request Coordinator at [email protected].

§740.10

SERVICING AND REPLACEMENT OFPARTS AND EQUIPMENT (RPL)

This License Exception authorizes exports andreexports associated with one-for-onereplacement of parts or servicing and replacementof equipment.

(a) Parts

(1) Scope. The provisions of this paragraph (a)authorize the export and reexport of one-for-onereplacement parts for previously exportedequipment.

(2) One-for-one replacement of parts.

(i) The term “replacement parts” as used inthis section means parts needed for the immediaterepair of equipment, including replacement ofdefective or worn parts. (It includessubassemblies but does not include test

instruments or operating supplies). (The term“subassembly” means a number of componentsassembled to perform a specific function orfunctions within a commodity. One examplewould be printed circuit boards with componentsmounted thereon. This definition does notinclude major subsystems such as those composedof a number of subassemblies.) Items thatimprove or change the basic designcharacteristics, e.g., as to accuracy, capability,performance or productivity, of the equipmentupon which they are installed, are not deemed tobe replacement parts. For kits consisting ofreplacement parts, consult §740.9(a)(2)(ii) of thispart.

(ii) Parts may be exported only to replace, ona one-for-one basis, parts contained incommodities that were: legally exported from theUnited States; legally reexported; or made in aforeign country incorporating authorized U.S.-origin parts. (For exports or reexports to theinstalled base in Libya see §764.7 of the EAR).The conditions of the original U.S. authorizationmust not have been violated. Accordingly, theexport of replacement parts may be made only bythe party who originally exported or reexportedthe commodity to be repaired, or by a party thathas confirmed the appropriate authority for theoriginal transaction.

(iii) The parts to be replaced must either bedestroyed abroad or returned promptly to theperson who supplied the replacement parts, or toa foreign firm that is under the effective controlof that person.

(3) Exclusions.

(i) No replacement parts may be exported torepair a commodity exported under a license ifthat license included a condition that anysubsequent replacement parts must be exportedonly under a license.

(ii) No parts may be exported to be held

mailto:[email protected].



abroad as spare parts or equipment for future use.Replacement parts may be exported to replacespare parts that were authorized to accompany theexport of equipment, as those spare parts areutilized in the repair of the equipment. This willallow maintenance of the stock of spares at aconsistent level as parts are used.

(iii) No parts may be exported to anydestination, except the countries listed inSupplement No. 3 to part 744 of the EAR(Countries Not Subject to Certain Nuclear End-Use Restrictions in §744.2(a)), if the item is to beincorporated into or used in nuclear weapons,nuclear explosive devices, nuclear testing relatedto activities described in §744.2(a) of the EAR,the chemical processing of irradiated specialnuclear or source material, the production ofheavy water, the separation of isotopes of sourceand special nuclear materials, or the fabrication ofnuclear reactor fuel containing plutonium, asdescribed in §744.2(a) of the EAR.

(iv) No replacement parts may be exported tocountries in Country Group E:1 (see SupplementNo. 1 to this part) (countries designated by theSecretary of State as supporting acts ofinternational terrorism) if the commodity to berepaired is an “aircraft” (as defined in part 772 ofthe EAR) or national security controlledcommodity.

(v) No replacement parts may be exported tocountries in Country Group E:1 if the commodityto be repaired is explosives detection equipmentcontrolled under ECCN 2A983 or relatedsoftware controlled under ECCN 2D983.

(vi) The conditions described in this paragraph(a)(3) relating to replacement of parts do notapply to reexports to a foreign country of parts asreplacements in foreign-origin products, if at thetime the replacements are furnished, the foreign-origin product is eligible for export to suchcountry under any of the License Exceptions inthis part or the exceptions in §734.4 of the EAR.

(4) Reexports. Parts exported from the UnitedStates may be reexported to a new country ofdestination, provided that the restrictions de-scribed in paragraphs (a)(2) and (3) of this sectionare met. A party reexporting U.S.-origin one-for-one replacement parts shall ensure that thecommodities being repaired were shipped to theirpresent location in accordance with U.S. law andcontinue to be legally used, and that either beforeor promptly after reexport of the replacementparts, the replaced parts are either destroyed orreturned to the United States, or to the foreignfirm in Country Group B (see Supplement No. 1to part 740) that shipped the replacement parts.

(b) Servicing and Replacement

(1) Scope. The provisions of this paragraph (b)authorize the export and reexport of items thatwere returned to the United States for servicingand the replacement of defective or unacceptableU.S.-origin commodities and software.

(2) Commodities and software sent to a UnitedStates or foreign party for servicing.

(i) Definition. “Servicing” as used in thissection means inspection, testing, calibration orrepair, including overhaul and reconditioning.The servicing shall not have improved or changedthe basic characteristics, e.g., as to accuracy,capability, performance, or productivity of thecommodity or software as originally authorizedfor export or reexport.

(ii) Return of serviced commodities andsoftware. When the serviced commodity orsoftware is returned, it may include anyreplacement or rebuilt parts necessary to its repairand may be accompanied by any spare part, tool,accessory, or other item that was sent with it forservicing.

(iii) Commodities and software importedfrom Country Group D:1 except the People’sRepublic of China (PRC). Commodities and



software legally exported or reexported to aconsignee in Country Group D:1 (except thePeople's Republic of China (PRC)) (seeSupplement No. 1 to part 740) that are sent to theUnited States or a foreign party for servicing maybe returned under this License Exception to thecountry from which it was sent, provided thatboth of the following conditions are met:

(A) The exporter making the shipment is thesame person or firm to whom the original licensewas issued; and

(B) The end-use and the end-user of theserviced commodities or software and otherparticulars of the transaction, as set forth in theapplication and supporting documentation thatformed the basis for issuance of the license havenot changed.

(iv) Terrorist supporting countries. Norepaired commodity or software may be exportedor reexported to countries in Country Group E:1(see Supplement No. 1 to this part).

(3) Replacements for defective or unacceptableU.S.-origin equipment.

(i) Subject to the following conditions,commodities or software may be exported orreexported to replace defective or otherwiseunusable (e.g., erroneously supplied) items.

(A) The commodity or software to bereplaced must have been previously exported orreexported in its present form under a license orauthorization granted by BIS.

(B) No commodity or software may beexported or reexported to replace equipment thatis worn out from normal use, nor may anycommodity or software be exported to be held instock abroad as spare equipment for future use.

(C) The replacement item may not improvethe basic characteristic, e.g., as to accuracy,

capability, performance, or productivity, of theequipment as originally approved for export orreexport under a license issued by BIS.

(D) No shipment may be made to countriesin Country Group E:1 (see Supplement No. 1 tothis part) or to any other destination to replacedefective or otherwise unusable equipment ownedor controlled by, or leased or chartered to, anational of any of those countries.

(ii) Special conditions applicable to exports toCountry Group B and Country Group D:1. (SeeSupplement No. 1 to part 740.) In addition to thegeneral conditions in paragraph (b)(3)(i) of thissection, the following conditions apply to exportsor reexports of replacements for defective orunacceptable U.S.-origin commodities or softwareto a destination in Country Group B or CountryGroup D:1:

(A) By making such an export or reexport,the exporter represents that all the requirementsof this paragraph (b) have been met andundertakes to destroy or return the replaced partsas provided in paragraph (b)(3)(ii)(C) of thissection.

(B) The defective or otherwise unusableequipment must be replaced free of charge,except for transportation and labor charges. Ifexporting to the countries listed in Country GroupD:1 (except the PRC), the exporter shall replacethe commodity or software within the warrantyperiod or within 12 months of its shipment to theultimate consignee in the country of destination,whichever is shorter.

(C) The commodity or software to bereplaced must either be destroyed abroad orreturned to the United States, or to a foreign firmin Country Group B that is under the effectivecontrol of the exporter, or to the foreign firm thatis providing the replacement part or equipment.The destruction or return must be effected before,or promptly after, the replacement item is



exported from the United States.

(D) A party reexporting replacements fordefective or unacceptable U.S.-origin equipmentmust ensure that the commodities or softwarebeing replaced were shipped to their presentlocation in accordance with U.S. law andcontinue to be legally used. See §764.7 of theEAR for exports or reexports to the installed basein Libya.

(c)Special Recordkeeping Requirements:ECCNs 2A983 and 2D983

(1) In addition to any other recordkeepingrequirements set forth elsewhere in the EAR,exporters are required to maintain records, asspecified in this section, for any items exported orreexported pursuant to License Exception RPL torepair or service previously legally exported orreexported items controlled under ECCNs 2A983and 2D983. The following information must bespecially maintained for each such export orreexport transaction:

(i) A description of the equipment replaced,repaired or serviced;

(ii) The type of repair or service;

(iii) Certification of the destruction or return ofequipment replaced;

(iv) Location of the equipment replaced,repaired or serviced;

(v) The name and address of who received theitems for replacement, repair or service;

(vi) Quantity of items shipped; and

(vii) Country of ultimate destination.

(2) Records maintained pursuant to this section may be requested at any time by an appropriateBIS official as set forth in §762.7 of the EAR.

§740.11

GOVERNMENTS, INTERNATIONALORGANIZATIONS, INTERNATIONAL

INSPECTIONS UNDER THE CHEMICALWEAPONS CONVENTION, AND THEINTERNATIONAL SPACE STATION

(GOV)

This License Exception authorizes exports andreexports for international nuclear safeguards;U.S. government agencies or personnel, andagencies of cooperating governments;international inspections under the ChemicalWeapons Convention; and the International SpaceStation.

(a) International Safeguards

(1) Scope. You may export and reexportcommodities or software to the InternationalAtomic Energy Agency (IAEA) and the EuropeanAtomic Energy Community (Euratom), andreexports by IAEA and Euratom for officialinternational safeguard use, as follows:

(i) Commodities or software consigned to theIAEA at its headquarters in Vienna, Austria orfield offices in Toronto, Ontario, Canada orTokyo, Japan for official international safeguardsuse. The IAEA is an international organizationthat establishes and administers safeguardsdesigned to ensure that special nuclear materialsand other related nuclear facilities, equipment,and material are not diverted from peacefulpurposes to non-peaceful purposes.

(ii) Commodities or software consigned to theEuratom Safeguards Directorate in Luxembourg,Luxembourg for official international safeguardsuse. Euratom is an international organization ofEuropean countries with headquarters inLuxembourg. Euratom establishes andadministers safeguards designed to ensure thatspecial nuclear materials and other related nuclearfacilities, equipment, and material are not



diverted from peaceful purposes to non-peacefulpurposes.

(iii) Commodities consigned to IAEA orEuratom may be reexported to any country forIAEA or Euratom international safeguards useprovided that IAEA or Euratom maintains controlof or otherwise safeguards the commodities andreturns the commodities to the locations describedin paragraphs (a)(1)(i) and (a)(1)(ii) of thissection when they become obsolete, are no longerrequired, or are replaced.

(iv) Commodity or software shipments may bemade by commercial companies under directcontract with IAEA or Euratom, or byDepartment of Energy National Laboratories asdirected by the Department of State or theDepartment of Energy.

(v) The monitoring functions of IAEA andEuratom are not subject to the restrictions onprohibited safeguarded nuclear activities de-scribed in §744.2(a)(3) of the EAR.

(vi) When commodities or software originallyconsigned to IAEA or Euratom are no longer inIAEA or Euratom official safeguards use, suchcommodities may only be disposed of inaccordance with the regulations in the EAR. (2) The following items controlled for nationalsecurity (NS) reasons under Export ControlClassification Numbers (ECCNs) identified onthe Commerce Control List may not be exportedor reexported under this License Exception todestinations other than Austria, Belgium, Canada,Denmark, Finland, France, Germany, Greece,Ireland, Italy, Luxembourg, the Netherlands,Portugal, Spain, Sweden, and the UnitedKingdom: 1C001, 5A001.b.5, 6A001.a.1.b.1object detection and location systems having asound pressure level exceeding 210 dB (reference1 µPa at 1 m) for equipment with an operatingfrequency in the band from 30 Hz to 2 kHzinclusive, 6A001.a.2.a.1, 6A001.a.2.a.2,

6A001.a.2.a.3, 6A001.a.2.a.5, 6A001.a.2.a.6,6A001.a.2.b, 6A001.a.2.e, 6A002.a.1.c,6A008.l.3, 6B008, 8A001.b, 8A001.d,8A002.o.3.b; and

(i) “Composite” structures or laminatescontrolled by 1A002.a, having an organic“matrix” and made from materials listed under1C010.c or 1C010.d; and

(ii) [RESERVED]

(iii) [RESERVED]

(iv) Processing equipment controlled by6A001.a.2.c and specially designed for real timeapplication with towed acoustic hydrophonearrays; and

(v) Processing equipment, specially designedfor real time application bottom or bay cablesystems controlled by 6A001.a.2.f ; and

(vi) “Software”, as follows:

(A) [RESERVED]

(B) Controlled by 5D001.a, speciallydesigned for the “development” or “production”of equipment, functions or features controlled by5A001.b.5; and

(C) Controlled by 6D001 for itemscontrolled by 6A008.l.3 or 6B008; and

(D) Controlled by 6D003.a; and

(E) Controlled by 7D003.a or 7D003.b; and

(F) Controlled by 8D001, specially designedfor the “development” or “production” ofequipment controlled by 8A001.b, 8A001.d, or8A002.o.3.b; and

(G) Controlled by 9D001, speciallydesigned or modified for the “development” of



equipment or “technology” controlled by 9A011,9E003.a.1, or 9E003.a.3.a; and

(H) Controlled by 9D002,specially designedor modified for the “production” of equipmentcontrolled by 9A011.

(3) No encryption items controlled for EI reasonsunder ECCNs 5A002, 5D002, or 5E002 may beexported under the provisions of this paragraph(a).

(4) Restrictions. Nationals of countries inCountry Group E:1 may not physically orcomputationally access computers that have beenenhanced by “electronic assemblies”, which havebeen exported or reexported under LicenseException GOV and have been used to enhancesuch computers by aggregation of processors sothat the APP of the aggregation exceeds the APPparameter set forth in ECCN 4A003.b. of theCommerce Control List in Supplement No. 1 topart 774 of the EAR, without prior authorizationfrom the Bureau of Industry and Security.

(b) Governments

(1) Scope. The provisions of paragraph (b)authorize exports and reexports of the items listedin paragraph (b)(2) of this section to personneland agencies of the U.S. Government or agenciesof cooperating governments.

(2) Eligibility.

(i) Items for personal use by personnel andagencies of the U.S. Government. This provisionis available for items in quantities sufficient onlyfor the personal use of members of the U.S.Armed Forces or civilian personnel of the U.S.Government (including U.S. representatives topublic international organizations), and theirimmediate families and servants. Items forpersonal use include household effects, food,beverages, and other daily necessities.

(ii) Items for official use by personnel andagencies of the U.S. Government. This provisionis available for items consigned to and for theofficial use of any agency of the U.S.Government.

(iii)(A) Items for official use within nationalterritory by agencies of cooperatinggovernments. This License Exception is availablefor all items consigned to and for the official useof any agency of a cooperating government withinthe territory of any cooperating government,except items described in paragraph (a) toSupplement No. 1 of this section:

(B) Reporting requirements. See §743.1 ofthe EAR for reporting requirements for exports ofcertain items under this paragraph (b)(2)(iii).

(iv) (A) Diplomatic and consular missions ofa cooperating government. This LicenseException is available for all items consigned toand for the official use of a diplomatic or consularmission of a cooperating government located inany country in Country Group B (see SupplementNo. 1 to part 740), except items described inparagraph (b) of Supplement No. 1 of this section.

(B) Reporting requirements. See §743.1 ofthe EAR for reporting requirements for exports ofcertain items under this paragraph (b)(2)(iv).(3) Definitions.

(i) “Agency of the U.S. Government” includesall civilian and military departments, branches,missions, government-owned corporations, andother agencies of the U.S. Government, but doesnot include such national agencies as theAmerican Red Cross or internationalorganizations in which the United Statesparticipates such as the Organization of AmericanStates. Therefore, shipments may not be made tothese non-government national or internationalagencies, except as provided in (b)(2)(i) of thissection for U.S. representatives to theseorganizations.



(ii) “Agency of a cooperating government”includes all civilian and military departments,branches, missions, and other governmentalagencies of a cooperating national government.Cooperating governments are the nationalgovernments of countries listed in Country GroupA:1 (see Supplement No. 1 to part 740) and thenational governments of Argentina, Austria,Finland, Hong Kong, Ireland, Korea (Republicof), New Zealand, Singapore, Sweden,Switzerland and Taiwan.

(c) International inspections under theChemical Weapons Convention

(CWC or Convention)

(1) The provisions of this paragraph (c) authorizeexports and reexports to the Organization for theProhibition of Chemical Weapons (OPCW) andexports and reexports by the OPCW for officialinternational inspection and verification use underthe terms of the Convention. The OPCW is aninternational organization that establishes andadministers an inspection and verification regimeunder the Convention designed to ensure thatcertain chemicals and related facilities are notdiverted from peaceful purposes to non-peacefulpurposes. These provisions authorize exports andreexports for official OPCW use of the following:

(i) Commodities and software consigned to theOPCW at its headquarters in The Hague forofficial international OPCW use for themonitoring and inspection functions set forth inthe Convention, and technology relating to themaintenance, repair, and operation of suchcommodities and software. The OPCW must maintain effective control of such commodities,software and technology.

(ii) Controlled technology relating to thetraining of the OPCW inspectorate.

(iii) Controlled technology relating to a CWCinspection site, including technology released asa result of:

(A) Visual inspection of U.S.-originequipment or facilities by foreign nationals of theinspection team;

(B) Oral communication of controlledtechnology to foreign nationals of the inspectionteam in the U.S. or abroad; and

(C) The application to situations abroad ofpersonal knowledge or technical experienceacquired in the U.S.

(2) Exclusions. The following items may not beexported or reexported under the provisions ofthis paragraph (c):

(i) [RESERVED]

(ii) Inspection samples collected in the U.S.pursuant to the Convention; and

(iii) Commodities and software that are nolonger in OPCW official use. Such items must bedisposed of in accordance with the EAR.

(3) Confidentiality. The application of theprovisions of this paragraph (c) is subject to thecondition that the confidentiality of businessinformation is strictly protected in accordancewith applicable provisions of the EAR and otherU.S. laws regarding the use and transfer of U.S.goods and services.

(4) Restrictions. Restrictions. Nationals ofcountries in Country Group E:1 may notphysically or computationally access computersthat have been enhanced by “electronicassemblies”, which have been exported orreexported under License Exception GOV andhave been used to enhance such computers byaggregation of processors so that the APP of theaggregation exceeds the APP parameter set forthin ECCN 4A003.b. of the Commerce Control Listin Supplement No. 1 to part 774 of the EAR,without prior authorization from the Bureau ofIndustry and Security.



(d) International Space Station (ISS)

(1) Scope. This paragraph (d) authorizes exportsand reexports required on short notice of certaincommodities subject to the EAR that areclassified under ECCN 9A004 to launch sites forsupply missions to the International Space Station(ISS). The ISS is a research facility in a low-Earth orbit approximately 190 miles (350 km)above the surface of the Earth. The ISS is a jointproject among the space agencies of the UnitedStates, Russia, Japan, Canada, Europe and Italy.

(2) Eligible commodities. Any commoditysubject to the EAR that is classified under ECCN9A004 and that is required for use on the ISS onshort notice.

Note 1 to paragraph (d)(2): This licenseexception is not available for the export orreexport of parts and components to overseasmanufacturers for the purpose of incorporationinto other items destined for the ISS.

Note 2 to paragraph (d)(2): For purposes ofthis paragraph (d), ‘short notice’ means theexporter is required to have a commoditymanifested and at the scheduled launch site forhatch-closure (final stowage) no more than forty-five (45) days from the time the exporter orreexporter received complete documentation.‘Complete documentation’ means the exporter orreexporter received the technical description ofthe commodity and purpose for use of thecommodity on the ISS. For purposes of thisparagraph (d), ‘hatch-closure (final stowage)’means the final date specified by a launchprovider by which items must be at a specifiedlocation in a launch country in order to beincluded on a mission to the ISS. The exporter orreexporter must receive the notification to supplythe commodity for use on the ISS in writing. Thatnotification must be kept in accordance withparagraph (d)(6) of this section and theRecordkeeping requirements in part 762 of theEAR.

(3) Eligible destinations. Eligible destinationsare France, Japan, Kazakhstan, and Russia. Tobe eligible, a destination needs to have a launchfor a supply mission to the ISS scheduled by acountry participating in the ISS.

(i) Authorization to retain commodity at ornear launch site for up to six months. If there areunexpected delays in a launch schedule forreasons such as mechanical failures in a launchvehicle or weather, commodities exported orreexported under the provisions of this paragraph(d) are authorized to be retained at or near thelaunch site for a period of six (6) months from thetime of initial export or reexport before thecommodities must be destroyed, returned to theexporter or reexporter, or be the subject of anindividually validated license request submittedto BIS to authorize further disposition of thecommodities.

(ii) Authorization to retain commodity abroadat launch country beyond six months. If, after thecommodity is exported or reexported under thisauthorization, a delay occurs in the launchschedule that would exceed the 6-month deadlinein paragraph (d)(3)(ii)(A) of this section, theexporter or reexporter or the person in control ofthe commodities in the launch country mayrequest a one-time 6-month extension bysubmitting written notification to BIS requestinga 6-month extension and noting the reason for thedelay. If the requestor is not contacted by BISwithin 30 days from the date of the postmark ofthe written notification and if the notificationmeets the requirements of this subparagraph, therequest is deemed granted. The request must besent to BIS at the address listed in part 748 of theEAR and should include the name and address ofthe exporter or reexporter, the name and addressof the person who has control of the commodity,the date the commodities were exported orreexported, a brief product description, and thejustification for the extension. To retain acommodity abroad beyond the time authorized byparagraph (d)(3)(ii)(A) of this section, the



exporter, reexporter or person in control of thecommodity must request authorization bysubmitting a license application in accordancewith §§ 748.1, 748.4 and 748.6 of the EAR toBIS 90 days prior to the expiration of the 6-monthextension period. (iii) Items not delivered to the ISS because ofa failed launch. If the commodities exported orreexported under this paragraph (d) of this sectionare not delivered to the ISS because a failedlaunch causes the destruction of the commodityprior to its being delivered, exporters andreexporters must make note of the destruction ofthe commodities in accordance with therecordkeeping requirements under paragraph(d)(6)(ii) of this section and part 762 of the EAR.

(4) Requirement for commodities to belaunched on an eligible space launch vehicle(SLV). Only commodities that will be deliveredto the ISS using United States, Russian, ESA(French), or Japanese space launch vehicles(SLVs) are eligible under this authorization.Commodities to be delivered to the ISS usingSLVs from any other countries are excluded fromthis authorization. (5) Eligible recipients. Only persons involved inthe launch of commodities to the ISS may receiveand have access to commodities exported orreexported pursuant to this paragraph (d), exceptthat:

(i) No commodities authorized under paragraph(d) of this section may be exported, reexported ortransferred (in-country) to any national of an E:1country listed in Supplement No. 1 to part 740 ofthe EAR, and

(ii) No person may receive commoditiesauthorized under paragraph (d) of this section ifthey are subject to an end-user or end-use controldescribed in part 744 of the EAR, including theentity list in Supplement No. 4 to part 744.

(6) Recordkeeping requirements. Exportersand reexporters must maintain records regardingexports or reexports made using the authorizationin paragraph (d) of this section as well as anyother applicable recordkeeping requirementsunder part 762 of the EAR.

(i) Exporters and reexporters must retain arecord of the initial written notification theyreceived requesting these commodities besupplied on short notice for a supply mission tothe ISS, including the date the exporter orreexporter received complete documentation (i.e.,the day on which the 45-day clock begins underparagraph (d) of this section). ‘Completedocumentation’ means the exporter or reexporterreceived the technical description of thecommodity and purpose for use of the commodityon the ISS.

(ii) Exporters and reexporters must maintainrecords of the date of any exports or reexportsmade using the authorization in paragraph (d) ofthis section and the date on which thecommodities were launched into space fordelivery to the ISS. If the commodities exportedor reexported under paragraph (d) of this sectionare not delivered to the ISS because of a failedlaunch whereby the item is destroyed prior tobeing delivered to the ISS, this must be noted forrecordkeeping purposes.

(iii) The return or destruction of defective orworn out parts or components exported pursuantto paragraph (d) of License Exception GOV is notrequired under this authorization. However, ifdefective or worn out parts or componentsoriginally exported or reexported pursuant to thisparagraph (d) are returned from the ISS, thenthose parts and components may be either:returned to the original country of export orreexport; destroyed; or reexported or transferred(in-country) to a destination that has beendesignated by NASA for conducting a review andanalysis of the defective or worn part orcomponent. Documentation for this activity must



be kept for recordkeeping purposes. Nocommodities that are subject to the EAR may bereturned to a country listed in Country Group E:1in Supplement No. 1 to part 740 or to any personif that person is subject to an end-user or end-usecontrol described in part 744 of the EAR underthe provisions of this paragraph (d)(6)(iii) of thissection or any other provision of this paragraph(d) of this section. For purposes of paragraph (d)of this section, a ‘defective or worn out’ part orcomponent is a part or component that no longerperforms its intended function.

(7) Reexports to an alternate launch country.If a mechanical or weather related issue causes achange from the scheduled launch country toanother foreign country after a commodity wasexported or reexported under this paragraph (d),then that commodity may be subsequentlyreexported to the new scheduled launch country,provided all of the terms and conditions ofparagraph (d) of this section are met, along withany other applicable EAR provisions. In suchinstances, the 6-month time limitation describedin paragraph (d)(3)(ii)(A) of this section wouldstart over again at the time of the subsequentreexport transaction. Note that if the subsequentreexport may be made under the designation NoLicense Required (NLR) or some otherauthorization under the EAR, a reexporter doesnot need to rely on the provisions contained inthis paragraph (d).

§740.12

GIFT PARCELS AND HUMANITARIANDONATIONS (GFT)

(a) Gift parcels

(1) Scope. The provisions of paragraph (a)authorize exports and reexports of gift parcels byan individual (donor) addressed to an individual,or a religious, charitable or educationalorganization (donee) located in any destinationfor the use of the donee or the donee's immediate

family (and not for resale). The gift parcel mustbe provided free of charge to the donee.However, payment by the donee of any handlingcharges or of any fees levied by the importingcountry (e.g., import duties, taxes, etc.) is notconsidered to be a cost to the donee for purposesof this definition of “gift parcel.”2

Note to paragraph (a) of this section: A giftparcel, within the context of this paragraph (a),does not include multiple parcels exported in asingle shipment for delivery to individualsresiding in a foreign country. Such multiple giftparcels, if subject to the General Prohibitionsdescribed in §736.2(b) of the EAR, must belicensed by BIS. (See §748.8(d) and SupplementNo. 2 to Part 748 paragraph (d) of the EAR forlicensing of multiple gift parcels).

(2) Commodity, value and other limitations.

(i) Item limitations.

(A) Prohibited items.

(1) For Cuba no items listed on theCommerce Control List other than items listed in§ 740.19(b) of the EAR may be included in a giftparcel.

(2) For all destinations, no items controlledfor chemical and biological weapons (CB),missile technology (MT), national security (NS),nuclear proliferation (NP) or encryption items(EI) reasons on the Commerce Control List

Many foreign countries permit the entry, duty-free,2

of gift parcels that conform to regulations regarding

contents and marking. To secure this advantage, the

sender should show the words “U.S.A. Gift Parcel” on

the addressee side of the package and on any required

customs declarations. Information regarding the for-

eign postal regulations is available at local post offices.

Senders of gift parcels who wish information regarding

import duties of a foreign country should contact the

nearest Commercial Office, Consulate or Embassy of

the country concerned.



(Supplement no. 1 to part 774 of the EAR) maybe included in a gift parcel.

(3) Items prohibited for destinations inCountry Group D:1 or E:2. For destinations inCountry Group D:1 or E:2, military wearingapparel may not be included in a gift parcelregardless of whether all distinctive U.S. militaryinsignia, buttons, and other markings areremoved.

(4) Gold bullion, gold taels, and gold barsare prohibited as are items intended for resale orreexport.

(B) Eligible items. For all destinations, eligibleitems are food (including vitamins); medicines,medical supplies and devices (including hospitalsupplies and equipment and equipment for thehandicapped); receive-only radio equipment forreception of commercial/civil AM/FM and shortwave publicly available frequency bands, andbatteries for such equipment; clothing; personalhygiene items; seeds; veterinary medicines andsupplies; fishing equipment and supplies;soap-making equipment; as well as all other itemsof a type normally sent as gifts betweenindividuals (including items listed in § 740.19(b)of the EAR ) except for those items prohibited inparagraph (a)(2)(i)(A) of this section. Items ingift parcels must be in quantities normally givenas gifts between individuals.

Example to paragraph (a)(2)(i)(B) of thissection. A watch or piece of jewelry is normallysent as a gift. However, multiple watches, eitherin one package or in subsequent shipments, wouldnot qualify for such gift parcels because thequantity would exceed that normally givenbetween individuals. Similarly, a sewing machineor bicycle within the value limit of this LicenseException may be an appropriate gift. However,subsequent shipments of the same item to thesame donee would not be a gift normally givenbetween individuals.

(ii) Import requirements. The commodities

must be acceptable in type and quantity by therecipient country for import as gifts.Commodities exceeding the import limits may notbe included in gift parcels.

(iii) Frequency.

(A) Except for gift parcels of food to Cuba,not more than one gift parcel may be sent fromthe same donor to the same donee in any onecalendar month.

(B) There is no frequency limit on gift parcelsof food to Cuba.

(C) Parties seeking authorization to exceedthe frequency limit due to compellinghumanitarian concerns (e.g., for certain gifts ofmedicine) should submit a license application inaccordance with §§ 748.1, 748.4 and 748.6 of theEAR to BIS with complete justification.

(iv) Value. The combined total domestic retailvalue of all commodities and software in a singlegift parcel may not exceed $800. This limit doesnot apply to food sent in a gift parcel to Cuba.

(v) Ineligible recipients.

(A) No gift parcel may be sent to any of thefollowing officials of the Cuban Government:ministers and vice-ministers; members of theCouncil of State; members of the Council ofMinisters; members and employees of theNational Assembly of People's Power; membersof any provincial assembly; local sector chiefs ofthe Committees for the Defense of theRevolution; Director Generals and sub-DirectorGenerals and higher of all Cuban ministries andstate agencies; employees of the Ministry of theInterior (MININT); employees of the Ministry ofDefense (MINFAR); secretaries and firstsecretaries of the Confederation of Labor of Cuba(CTC) and its component unions; chief editors,editors and deputy editors of Cuban state-runmedia organizations and programs, includingnewspapers, television, and radio; or members



and employees of the Supreme Court (TribunoSupremo Nacional).

(B) No gift parcel may be sent to any of thefollowing officials or members of the CubanCommunist Party: members of the Politburo; theCentral Committee; Department Heads of theCentral Committee; employees of the CentralCommittee; and the secretaries and firstsecretaries of provincial Party central committees.

(C) No gift parcel may be sent to organizationsadministered or controlled by the CubanGovernment or the Cuban Communist Party.

(3) How to export gift parcels. (i) A gift parcelmust be sent directly to the donee by theindividual donor, or for such donor by acommercial or other gift-forwarding service ororganization. Each gift parcel must show, on theoutside wrapper, the name and address of thedonor, as well as the name and address of thedonee, regardless of whether sent by the donor orby a forwarding service.

(ii) Each parcel must have the notation “GIFT— Export License Not Required” written on theaddressee side of the package and the symbol“GFT” written on any required customsdeclaration.

(b) Humanitarian donations

(1) Scope. The provisions of paragraph (b)authorize exports or reexports by groups ororganizations of donations to meet basic humanneeds when those groups or organizations haveexperience in maintaining a verifiable system ofdistribution that ensures delivery to the intendedbeneficiaries.

(2) Basic human needs. Basic human needs aredefined as those requirements essential toindividual well-being: health, food, clothing,shelter, and education. These needs areconsidered to extend beyond those of anemergency nature and those that meet direct

needs for mere subsistence.

(3) Eligible donors. Eligible donors are U.S.charitable organizations that have an establishedrecord of involvement in donative programs andexperience in maintaining and verifying a systemof distribution to ensure delivery of commoditiesand software to the intended beneficiaries.Eligible distribution arrangements may consist ofany one or more of the following:

(i) A permanent staff maintained in therecipient country to monitor the receipt anddistribution of the donations to the intendedbeneficiaries;

(ii) Periodic spot-checks in the recipientcountry by members of the exporter's staff; or

(iii) An agreement to utilize the services of acharitable organization that has a monitoringsystem in place.

(4) Donations. To qualify for export under theprovisions of this paragraph (b), the items must beprovided free of charge to the beneficiary. Thepayment by the beneficiary, however, of normalhandling charges or fees levied by the importingcountry (e.g., import duties, taxes, etc.) is notconsidered to be a cost to the beneficiary forpurposes of this section.

(5) Ineligible commodities and software. Thefollowing commodities and software are noteligible:

(i) Commodities and software controlled fornational security, chemical or biological weapons,and nuclear non-proliferation, missile technologyor crime control reasons (see Supplement No. 1 topart 774 of the EAR);

(ii) Exports for large-scale projects of the kindassociated with comprehensive economic growth,such as dams and hydroelectric plants; or

(iii) Exports to Cuba of medical items



excluded by §746.2(b)(1) of the EAR.

(6) Eligible items. Eligible commodities andsoftware are those listed in Supplement No. 2 topart 740.

(7) Additional recordkeeping requirements.In addition to the recordkeeping requirements inpart 762 of the EAR, donors must keep recordscontaining the following information:

(i) The donor organization’s identity and pastexperience as an exporter of goods to meet basichuman needs;

(ii) Past and current countries to which thedonative programs have been and are beingdirected, with particular reference to donativeprograms in embargoed destinations;

(iii) Types of projects and commoditiesinvolved in the donative programs;

(iv) Specific class(es) of beneficiaries ofparticular donated goods intended to be exportedunder this License Exception; and

(v) Information concerning the source offunding for the donative programs and theprojected annual value of exports of humanitariandonations.

§740.13

TECHNOLOGY AND SOFTWARE — UNRESTRICTED (TSU)

This license exception authorizes exports andreexports of operation technology and software;sales technology and software; software updates(bug fixes); “mass market” software subject to theGeneral Software Note; and encryption sourcecode (and corresponding object code) that wouldbe considered publicly available under§734.3(b)(3) of the EAR. Note that encryptionsoftware subject to the EAR is not subject to the

General Software Note (see paragraph (d)(2) ofthis section).

(a) Operation technology and software

(1) Scope. The provisions of paragraph (a)permit exports and reexports of operationtechnology and software. “Operation technology”is the minimum technology necessary for theinstallation, operation, maintenance (checking),and repair of those commodities or software thatare lawfully exported or reexported under alicense, a License Exception, or NLR. The“minimum necessary” operation technology doesnot include technology for development orproduction and includes use technology only tothe extent required to ensure safe and efficientuse of the commodities or software. Individualentries in the software and technologysubcategories of the CCL may further restrict theexport or reexport of operation technology.

(2) Provisions and Destinations.

(i) Provisions. Operation software may beexported or reexported provided that both of thefollowing conditions are met:

(A) The operation software is the minimumnecessary to operate equipment authorized forexport or reexport; and

(B) The operation software is in objectcode.

(ii) Destinations. Operation software andtechnology may be exported or reexported to anydestination to which the equipment for which it isrequired has been or is being legally exported orreexported.

(b) Sales technology

(1) Scope. The provisions of paragraph (b)authorize exports and reexports of salestechnology. “Sales technology” is datasupporting a prospective or actual quotation, bid,



or offer to sell, lease, or otherwise supply anyitem.

(2) Provisions and destinations.

(i) Provisions. Sales technology may beexported or reexported provided that:

(A) The technology is a type customarilytransmitted with a prospective or actual quotation,bid, or offer in accordance with establishedbusiness practice; and

(B) Neither the export nor the reexport willdisclose the detailed design, production, ormanufacture technology, or the means ofreconstruction, of either the quoted item or itsproduct. The purpose of this limitation is toprevent disclosure of technology so detailed thatthe consignee could reduce the technology toproduction.

(ii) Destinations. Sales technology may beexported or reexported to any destination.

NOTE: Neither this section nor its use meansthat the U.S. Government intends, or iscommitted, to approve a license application forany commodity, plant, software, or technologythat may be the subject of the transaction towhich such quotation, bid, or offer relates.Exporters are advised to include in anyquotations, bids, or offers, and in any contractsentered into pursuant to such quotations, bids, oroffers, a provision relieving themselves ofliability in the event that a license (whenrequired) is not approved by the Bureau ofIndustry and Security.

(c) Software updates

The provisions of paragraph (c) authorize exportsand reexports of software updates that areintended for and are limited to correction oferrors (“fixes” to “bugs”) in software lawfullyexported or reexported (original software). Suchsoftware updates may be exported or reexported

only to the same consignee to whom the originalsoftware was exported or reexported, and suchsoftware updates may not enhance the functionalcapacities of the original software. Such softwareupdates may be exported or reexported to anydestination to which the software for which theyare required has been legally exported orreexported.

(d) General Software Note: mass market software

(1) Scope. The provisions of paragraph (d)authorize exports and reexports of mass marketsoftware subject to the General Software Note(see Supplement No. 2 to part 774 of the EAR;also referenced in this section).3

(2) Exclusions. The provisions of this paragraph(d) are not available for encryption softwarecontrolled for “EI” reasons under ECCN 5D002or for encryption software with symmetric keylength exceeding 64-bits that qualifies as massmarket encryption software under the criteria inthe Cryptography Note (Note 3) of Category 5,Part 2, of the Commerce Control List(Supplement No. 1 to part 774 of the EAR).(Once such mass market encryption software hasbeen reviewed by BIS and released from "EI" and"NS" controls pursuant to § 742.15(b) of theEAR, it is controlled under ECCN 5D992.c and isthus outside the scope of License ExceptionTSU.) See § 742.15(b) of the EAR for exportsand reexports of mass market encryptionproducts controlled under ECCN 5D992.c.

(3) Provisions and destinations.

(i) Destinations. Mass market software isavailable to all destinations except destinations inCountry Group E:1 (see Supplement No. 1 to this

“Mass market” software may fall under the 3

classification of “general use” software for export

clearance purposes. Exporters should consult the

Census Bureau FTSR for possible SED or AES

requirements.



part).

(ii) Provisions. Mass market treatment isavailable for software that is generally availableto the public by being:

(A) Sold from stock at retail selling points,without restriction, by means of:

(1) Over the counter transactions;

(2) Mail order transactions; or

(3) Telephone call transactions; and

(B) Designed for installation by the userwithout further substantial support by thesupplier.

(e) Encryption source code (and corresponding object code)

(1) Scope and eligibility. This paragraph (e)authorizes exports and reexports, without review,of encryption source code controlled by ECCN5D002 that, if not controlled by ECCN 5D002,would be considered publicly available under§734.3(b)(3) of the EAR. Such source code iseligible for License Exception TSU under thisparagraph (e) even if it is subject to an expressagreement for the payment of a licensing fee orroyalty for commercial production or sale of anyproduct developed using the source code. Thisparagraph also authorizes the export and reexportof the corresponding object code (i.e., that whichis compiled from source code that is authorizedfor export and reexport under this paragraph) ifboth the object code and the source code fromwhich it is compiled would be consideredpublicly available under §734.3(b)(3) of the EAR,if they were not controlled under ECCN 5D002.

(2) Restrictions. This paragraph (e) does notauthorize:

(i) Export or reexport of any encryptionsoftware controlled under ECCN 5D002 that does

not meet the requirements of paragraph (e)(1),even if the software incorporates or is speciallydesigned to use other encryption software thatmeets the requirements of paragraph (e)(1) of thissection; or

(ii) Any knowing export or reexport to acountry listed in Country Group E:1 inSupplement No. 1 to part 740 of the EAR.

(3) Notification requirement. You must notifyBIS and the ENC Encryption RequestCoordinator via e-mail of the Internet location(e.g., URL or Internet address) of the source codeor provide each of them a copy of the source codeat or before the time you take action to make thesoftware publicly available as that term isdescribed in §734.3(b)(3) of the EAR. If youelect to meet this requirement by providing copiesof the source code to BIS and the ENCEncryption Request Coordinator, you mustprovide additional copies to each of them eachtime the cryptographic functionality of thesoftware is updated or modified. If you elect toprovide the Internet location of the source code,you must notify BIS and the ENC EncryptionRequest Coordinator each time the Internetlocation is changed, but you are not required tonotify them of updates or modifications made tothe encryption software at the previously notifiedlocation. In all instances, submit the notificationor copy to [email protected] and [email protected].

Note to paragraph (e). Posting encryptionsource code and corresponding object code on theInternet (e.g., FTP or World Wide Web site)where it may be downloaded by anyone neitherestablishes “knowledge” of a prohibited export orreexport for purposes of this paragraph, nortriggers any “red flags” necessitating theaffirmative duty to inquire under the “Know YourCustomer” guidance provided in Supplement No.3 to part 732 of the EAR.



(f) Special Recordkeeping Requirements:ECCNs 2D983 and 2E983

In addition to any other recordkeepingrequirements set forth elsewhere in the EAR,exporters are required to maintain records, asspecified in this paragraph, when exportingoperation software or technology controlled underECCNs 2D983 and 2E983, respectively, underLicense Exception TSU. Records maintainedpursuant to this section may be requested at anytime by an appropriate BIS official as set forth in§762.7 of the EAR. The following informationmust be specially maintained for each export orreexport transaction, under License ExceptionTSU, of operation software and technologycontrolled by ECCNs 2D983 and 2E983:

(1) A description of the software or technologyexported or reexported, including the ECCN, asidentified on the CCL;

(2) A description of the equipment for which thesoftware or technology is intended to be used,including the ECCN, as identified on the CCL;

(3) The intended end-use of the software ortechnology;

(4) The name and address of the end-user;

(5) The quantity of software shipped; and

(6) The location of the equipment for which thesoftware or technology is intended to be used,including the country of destination.

§740.14

BAGGAGE (BAG)

(a) Scope

This License Exception authorizes individualsleaving the United States either temporarily (i.e.,traveling) or longer-term (i.e., moving) and crew

members of exporting or reexporting carriers totake to any destination, as personal baggage, theclasses of commodities, software and technologydescribed in this section.

(b) Eligibility

Individuals leaving the United States may exportor reexport any of the following commodities orsoftware for personal use of the individuals ormembers of their immediate families travelingwith them to any destination or series ofdestinations. Individuals leaving the UnitedStates who are U.S. persons, as defined inparagraph (b)(4)(i), may export or reexporttechnology as a tool of trade under paragraph(b)(4) for their personal use or for the personaluse of members of their immediate families whoare traveling or moving with them, provided theyare also U.S. persons, as defined in paragraph(b)(4)(i), to any destination or series ofdestinations. Technology exports and reexportsauthorized under paragraph (b)(4) of this sectionmay be made as actual shipments, transmissions,or releases. Individuals leaving the United Statestemporarily (i.e., traveling) must bring back itemsexported and reexported under this LicenseException unless they consume the items abroador are otherwise authorized to dispose of themunder the EAR. Crew members may export orreexport only commodities and softwaredescribed in paragraphs (b)(1) and (b)(2) of thissection to any destination.

(1) Personal effects. Usual and reasonable kindsand quantities for personal use of wearingapparel, articles of personal adornment, toiletarticles, medicinal supplies, food, souvenirs,games, and similar personal effects, and theircontainers.

(2) Household effects. Usual and reasonablekinds and quantities for personal use of furniture,household effects, household furnishings, andtheir containers.

(3) Vehicles. Usual and reasonable kinds and



quantities of vehicles, such as passenger cars,station wagons, trucks, trailers, motorcycles,bicycles, tricycles, perambulators, and theircontainers.

(4) Tools of trade. Usual and reasonable kindsand quantities of tools, instruments, or equipmentand their containers and also technology for usein the trade, occupation, employment, vocation, orhobby of the traveler or members of thehousehold who are traveling or moving. Forspecial provisions regarding encryptioncommodities and software subject to EI controls,see paragraph (f) of this section. For a specialprovision that specifies restrictions regarding theexport or reexport of technology under thisparagraph, see paragraph (g).

(i) For purposes of this paragraph (b), U.S.person is defined as follows: an individual who isa citizen of the United States, an individual whois a lawful permanent resident as defined by 8U.S.C. 1101(a)(2) or an individual who is aprotected individual as defined by 8 U.S.C.1324b(a)(3).

(ii) [RESERVED]

(c) Limits on eligibility

The export of any item is limited or prohibited, ifthe kind or quantity is in excess of the limitsdescribed in this section. In addition, the itemsmust be:

(1) Owned by the individuals (or by members oftheir immediate families) or by crew members ofexporting carriers on the dates they depart fromthe United States; (2) Intended for and necessary and appropriatefor the use of the individuals or members of theirimmediate families traveling with them, or by thecrew members of exporting carriers;

(3) Not intended for sale or other disposal; and

(4) Not exported under a bill of lading as cargo ifexported by crew members.

(d) Special provision: unaccompanied baggage

Individuals departing the United States may shipunaccompanied baggage, which is baggage sentfrom the United States on a carrier other than thaton which an individual departs. Crew members ofexporting carriers may not ship unaccompaniedbaggage. Unaccompanied shipments under thisLicense Exception shall be clearly marked“BAGGAGE.” Shipments of unaccompaniedbaggage may be made at the time of, or within areasonable time before or after departure of theconsignee or owner from the United States.Personal baggage controlled for chemical andbiological weapons (CB), missile technology(MT), national security (NS), encryption items(EI) or nuclear nonproliferation (NP) must beshipped within 3 months before or after the monthin which the consignee or owner departs theUnited States. However, commodities controlledfor CB, MT, NS, EI or NP may not be exportedunder this License Exception as unaccompaniedbaggage to Country Groups D:1, D:2, D:3, D:4, orE:1. (See Supplement No. 1 of this part).

(e) Special provisions: shotguns and shotgun shells

(1) A United States citizen or a permanentresident alien leaving the United States mayexport or reexport shotguns with a barrel lengthof 18 inches or over and shotgun shells under thisLicense Exception, subject to the followinglimitations:

(i) Not more than three shotguns may be takenon any one trip.

(ii) The shotguns and shotgun shells must bewith the person's baggage but they may not bemailed.

(iii) The shotguns and shotgun shells must be



for the person's exclusive use for legitimatehunting or lawful sporting purposes, scientificpurposes, or personal protection, and not forresale or other transfer of ownership or control.Accordingly, except as provided in (e)(2) of thissection, shotguns may not be exportedpermanently under this License Exception. Allshotguns and unused shotgun shells must bereturned to the United States. Note that sincecertain countries may require an ImportCertificate or a U.S. export license beforeallowing the import of a shotgun, you shoulddetermine the import requirements of yourcountry of destination in advance.

(2) A nonresident alien leaving the United Statesmay export or reexport under this LicenseException only such shotguns and shotgun shellsas he or she brought into the United States underthe provisions of the Department of JusticeRegulations (27 CFR 478.115(d)).

(f) Special provisions: encryption commoditiesand software subject to EI controls on the

Commerce Control List

(1) A U.S. citizen or permanent resident alien ofthe United States as defined by 8 U.S.C.1101(a)(20) may use this license exception toexport or reexport encryption commodities andsoftware to any destination not in Country GroupE:1 of Supplement No. 1 of this part.

(2) A person other than a U.S. citizen orpermanent resident alien of the United States asdefined by 8 U.S.C. 1101(a)(20) (except anational of a country listed in Country Group E:1of Supplement No. 1 of this part who is not a U.S.citizen or permanent resident alien of the UnitedStates) may also use this license exception toexport or reexport encryption commodities andsoftware to any destination not in Country GroupE:1 of Supplement No. 1 of this part.

(g) Special provision: restrictions for Export or Reexport of Technology.

This authorization for the export or reexport oftechnology under the tools of trade provisions ofparagraph (b)(4) of this section may be used onlyif:

(1) The technology is to be used overseas solelyby individuals or members of their immediatefamilies traveling with them provided they areU.S. persons as defined in paragraph (b)(4)(i).

(2) The exporting or reexporting party and therecipient take adequate security precautions toprotect against unauthorized access to thetechnology while the technology is beingtransmitted and used overseas. Examples ofsecurity precautions to help prevent unauthorizedaccess include the following:

(i) Use of secure connections, such as VirtualPrivate Network connections when accessing ITnetworks for e-mail and other business activitiesthat involve the transmission and use of thetechnology authorized under this licenseexception;

(ii) Use of password systems on electronicdevices that will store the technology authorizedunder this license exception; and

(iii) Use of personal firewalls on electronicdevices that will store the technology authorizedunder this license exception.

(3) The technology authorized under theseprovisions may not be used for foreign productionpurposes or for technical assistance unlessauthorized by BIS;

(4) Any encryption item controlled under ECCN5E002 is not exported or reexported to anydestination listed in Country Group E:1 ofSupplement No. 1 of this part.



§740.15

AIRCRAFT AND VESSELS (AVS)

This License Exception authorizes departure fromthe United States of foreign registry civil aircrafton temporary sojourn in the United States and ofU.S. civil aircraft for temporary sojourn abroad;the export of equipment and spare parts forpermanent use on a vessel or aircraft; and exportsto vessels or planes of U.S. or Canadian registryand U.S. or Canadian Airlines' installations oragents. Generally, no License Exception symbolis necessary for export clearance purposes;however, when necessary, the symbol “AVS”may be used.

(a) Aircraft on temporary sojourn

(1) Foreign registered aircraft. An operatingcivil aircraft of foreign registry that has been inthe United States on a temporary sojourn maydepart from the United States under its ownpower for any destination, provided that:

(i) No sale or transfer of operational control ofthe aircraft to nationals of a destination inCountry Group E:1 (see Supplement No. 1 to thispart) has occurred while in the United States;

(ii) The aircraft is not departing for thepurpose of sale or transfer of operational controlto nationals of a destination in Country Group E:1(see Supplement No. 1 to this part); and

(iii) It does not carry from the United Statesany item for which an export license is requiredand has not been granted by the U.S. Government.

(2) U.S. registered aircraft.

(i) A civil aircraft of U.S. registry operatingunder an Air Carrier Operating Certificate,Commercial Operating Certificate, or Air TaxiOperating Certificate issued by the FederalAviation Administration or conducting flightsunder operating specifications approved by the

Federal Aviation Administration pursuant to 14CFR part 129 of the regulations of the FederalAviation Administration, may depart from theUnited States under its own power for anydestination, provided that:

(A) The aircraft does not depart for thepurpose of sale, lease or other disposition ofoperational control of the aircraft, or itsequipment, parts, accessories, or components to aforeign country or any national thereof;

(B) The aircraft's U.S. registration will notbe changed while abroad;

(C) The aircraft is not to be used in anyforeign military activity while abroad; and

(D) The aircraft does not carry from theUnited States any item for which a license isrequired and has not been granted by the U.S.Government.

(ii) Any other operating civil aircraft of U.S.registry may depart from the United States underits own power for any destination, except to adestination in Country Group E:1 (seeSupplement No. 1 to this part) (flights to thesedestinations require a license), provided that:

(A) The aircraft does not depart for thepurpose of sale, lease or other disposition ofoperational control of the aircraft, or itsequipment, parts, accessories, or components to aforeign country or any national thereof;

(B) The aircraft's U.S. registration will notbe changed while abroad;

(C) The aircraft is not to be used in anyforeign military activity while abroad;

(D) The aircraft does not carry from theUnited States any item for which an exportlicense is required and has not been granted bythe U.S. Government; and



(E) The aircraft will be operated while a-broad by a U.S. licensed pilot, except that duringdomestic flights within a foreign country, theaircraft may be operated by a pilot currentlylicensed by that foreign country.

(3) Criteria. The following nine criteria eachmust be met if the flight is to qualify as atemporary sojourn. To be considered a temporarysojourn, the flight must not be for the purpose ofsale or transfer of operational control. An exportis for the transfer of operational control unless theexporter retains each of the following indicia ofcontrol:

(i) Hiring of cockpit crew. Right to hire andfire the cockpit crew.

(ii) Dispatch of aircraft. Right to dispatch theaircraft.

(iii) Selection of routes. Right to determinethe aircraft's routes (except for contractualcommitments entered into by the exporter forspecifically designated routes).

(iv) Place of maintenance. Right to performor obtain the principal maintenance on theaircraft, which principal maintenance isconducted outside a destination in Country GroupE:1 (see Supplement No. 1 to this part), under thecontrol of a party who is not a national of any ofthese countries. (The minimum necessary in-transit maintenance may be performed in anycountry).

(v) Location of spares. Spares are not locatedin a destination in Country Group E:1 (seeSupplement No. 1 to this part).

(vi) Place of registration. The place ofregistration is not changed to a destination inCountry Group E:1 (see Supplement No. 1 to thispart).

(vii) No transfer of technology. Notechnology is transferred to a national of adestination in Country Group E:1 (see

Supplement No. 1 to this part), except theminimum necessary in transit maintenance toperform flight line servicing required to departsafely.

(viii) Color and logos. The aircraft does notbear the livery, colors, or logos of a national of adestination in Country Group E:1 (seeSupplement No. 1 to this part).

(ix) Flight number. The aircraft does not flyunder a flight number issued to a national of adestination in Country Group E:1 (seeSupplement No. 1 to this part) as such a numberappears in the Official Airline Guide.

(4) Reexports. Civil aircraft legally exportedfrom the United States may be reexported underthis section, provided the restrictions described inthis paragraph (a) are met.

(b) Equipment and spare parts for permanentuse on a vessel or aircraft, and ship and

plane stores

(1) Vessel. Equipment and spare parts forpermanent use on a vessel, when necessary for theproper operation of such vessel, may be exportedor reexported for use on board a vessel of anyregistry, except a vessel registered in CountryGroup D:1 (see Supplement No. 1 to part 740),Cuba, or owned or controlled by, or under charteror lease to any of these countries or theirnationals. In addition, other equipment andservices for necessary repair to fishing andfishery support vessels of Country Group D:1may be exported for use on board such vesselswhen admitted into the United States undergoverning international fishery agreements.

(2) Aircraft. Equipment and spare parts forpermanent use on an aircraft, when necessary forthe proper operation of such aircraft, may beexported or reexported for use on board anaircraft of any registry, except an aircraftregistered in, owned or controlled by, or undercharter or lease to a country included in Country



Group D:1, Cuba, or a national of any of thesecountries.

(3) Ship and plane stores. Usual and reasonablekinds and quantities of the following commoditiesmay be exported for use or consumption on boardan aircraft or vessel of any registry during theoutgoing and immediate return flight or voyage.(Note that fuel and related commodities thatqualify as ship or plane stores as described in thisLicense Exception must be exported under theshort supply License Exception SPR (see§754.2(h) of the EAR.)

(i) Deck, engine, and steward departmentstores, provisions, and supplies for both port andvoyage requirements;

(ii) Medical and surgical supplies;

(iii) Food stores;

(iv) Slop chest articles;

(v) Saloon stores or supplies.

(c) Shipments to U.S. or Canadian vessels,planes and airline installations or agents

(1) Exports to vessels or planes of U.S. orCanadian registry. Export may be made of thecommodities set forth in paragraph (c)(3) of thissection, for use by or on a specific vessel or planeof U.S. or Canadian registry located at anyseaport or airport outside the United States orCanada except a port in Cuba or Country GroupD:1 (excluding the PRC), (see Supplement No. 1to part 740) provided that such commodities areall of the following:4

(i) Ordered by the person in command or theowner or agent of the vessel or plane to whichthey are consigned;

(ii) Intended to be used or consumed on boardsuch vessel or plane and necessary for its properoperation;

(iii) In usual and reasonable kinds andquantities during times of extreme need; and

(iv) Shipped as cargo for which a Shipper'sExport Declaration (SED) or Automated ExportSystem (AES) record has been filed in accordancewith the Foreign Trade Statistics Regulations (15CFR part 30), except that an SED or AES recordis not required when any of the commodities,other than fuel, is exported by U.S. airlines totheir own aircraft abroad for their own use. (2) Exports to U.S. or Canadian airline'sinstallation or agent. Exports of thecommodities set forth in paragraph (c)(3) of thissection, except fuel, may be made to a U.S. orCanadian airline's installation or agent in any5

foreign destination except Cuba or CountryGroup D:1 (excluding the PRC), (see SupplementNo. 1 to part 740) provided such commodities areall of the following:

(i) Ordered by a U.S. or Canadian airline andconsigned to its own installation or agent abroad;

(ii) Intended for maintenance, repair, oroperation of aircraft registered in either theUnited States or Canada, and necessary for theaircraft's proper operation, except where suchaircraft is located in, or owned, operated orcontrolled by, or leased or chartered to, Cuba orCountry Group D:1 (excluding the PRC) (seeSupplement No. 1 to part 740) or a national ofsuch country;

(iii) In usual and reasonable kinds andquantities; and

(iv) Shipped as cargo for which a Shipper's

Where a license is required, see §§ 748.1,4

748.4 and 748.6 of the EAR.

See Part 772 of the EAR for definitions of United5

States and Canadian airlines.



Export Declaration (SED) or Automated ExportSystem (AES) record has been filed in accordancewith the Foreign Trade Statistics Regulations (15CFR part 30), except that an SED or AES recordis not required when any of these commodities isexported by U.S. airlines to their owninstallations and agents abroad for use in theiraircraft operations.

(3) Applicable commodities. This paragraph (c)applies to the following commodities, subject tothe provisions in paragraph (c)(1) and (c)(2) ofthis section:

Note to paragraph (c)(3) of this section: Fueland related commodities for shipment to vesselsor planes of U.S. or Canadian registry asdescribed in this License Exception must beshipped under the short supply License ExceptionSPR (see §754.2(h) of the EAR);

(i) Deck, engine, and steward departmentstores, provisions, and supplies for both port andvoyage requirements;

(ii) Medical and surgical supplies;

(iii) Food stores;

(iv) Slop chest articles;

(v) Saloon stores or supplies; and

(vi) Equipment and spare parts.

(d) Vessels on temporary sojourn

(1) Foreign flagged vessels. A foreign flaggedvessel in the United States may depart from theUnited States under its own power for anydestination, provided that:

(i) No sale or transfer of operational control ofthe vessel to nationals of a destination in CountryGroup E:1 (see Supplement No.1 to this part) hasoccurred while in the United States;

(ii) The vessel is not departing for the purposeof sale or transfer of operational control tonationals of a destination in Country Group E:1(see Supplement No. 1 to this part); and

(iii) The vessel does not carry from the UnitedStates any item for which a license is requiredand has not been granted by the U.S. Government.

(2) U.S. flagged vessels. A U.S. flagged vesselmay depart from the United States under its ownpower for any destination, provided that:

(i) The vessel does not depart for the purposeof sale, lease, or transfer of operational control ofthe vessel, or its equipment, parts, accessories, orcomponents, to a foreign country or any nationalthereof;

(ii) The vessel's U.S. flag will not be changedwhile abroad;

(iii) The vessel will not be used in any foreignmilitary activity while abroad;

(iv) The vessel will not carry from the UnitedStates any item for which a license is requiredand has not been granted by the U.S.Government;

(v) Spares for the vessel are not located in adestination in Country Group E:1 (seeSupplement No. 1 to this part );

(vi) Technology is not transferred to a nationalof a destination in Country Group E:1 (seeSupplement No. 1 to this part), except theminimum necessary in-transit maintenance toperform servicing required to depart and enter aport safely; and

(vii) The vessel does not bear the livery,colors, or logos of a national of a destination inCountry Group E:1 (see Supplement No. 1 to thispart).



(3) Criteria for temporary sojourn of vessels.The following criteria must be met if a voyage isto be considered a temporary sojourn under thisparagraph (d). To be considered a temporarysojourn, the voyage must not be for the purposeof sale or transfer of operational control. Atransfer of operational control occurs unless theexporter or reexporter retains each of thefollowing indicia of control:

(i) Hiring of crew. Right to hire and fire the crew.

(ii) Dispatch of vessel. Right to dispatch the vessel.

(iii) Selection of routes. Right to determine the vessel's routes (except forcontractual commitments entered into by theexporter for specifically designated routes).

(iv) Place of maintenance. Right to perform or obtain the principal maintenance onthe vessel, which principal maintenance isconducted outside a destination in Country GroupE:1 (see Supplement No. 1 to this part), under thecontrol of a party who is not a national of any ofthese countries. (The minimum necessaryin-transit maintenance may be performed in anycountry).

(4) Reexports. Vessels subject to the EAR maybe reexported under this section on temporarysojourn, provided that:

(i) The vessel does not depart for the purposeof sale, lease, or transfer of operational control ofthe vessel, or its equipment, parts, accessories, orcomponents, to a foreign country or any nationalthereof;

(ii) The vessel's flag will not be changed whileabroad;

(iii) The vessel will not be used in any foreignmilitary activity while abroad;

(iv) The vessel will not carry any item forwhich a license is required and has not beengranted by the U.S. Government;

(v) Spares for the vessel are not located in adestination in Country Group E:1 (seeSupplement No. 1 to this part);

(vi) Technology is not transferred to a nationalof a destination in Country Group E:1 (seeSupplement No. 1 to this part), except theminimum necessary in-transit maintenance toperform servicing required to depart and enter aport safely; and

(vii) The vessel does not bear the livery,colors, or logos of a national of a destination inCountry Group E:1 (see Supplement No. 1 to thispart). (5) No vessels may be exported or reexportedunder this License Exception to a country inCountry Group E:1.

§ 740.16

ADDITIONAL PERMISSIVE REEXPORTS (APR)

This License Exception allows the followingreexports:

(a) Reexports from Country Group A:1 and cooperating countries

Reexports may be made from Country Group A:1or from cooperating countries, provided that:

(1) The reexport is made in accordance with theconditions of an export authorization from thegovernment of the reexporting country;

(2) The commodities being reexported are notcontrolled for NP, CB, MT, SI or CC reasons andare not military commodities described in ECCN0A919 or cameras described in ECCN



6A003.b.4.b; and

(3) The reexport is destined to either:

(i) A country in Country Group B that is notalso included in Country Group D:2, D:3, or D:4;and the commodity being reexported is bothcontrolled for national security reasons and notcontrolled for export to Country Group A:1; or

(ii) A country in Country Group D:1 (NationalSecurity) (see Supplement No. 1 to part 740),other than North Korea and the commodity beingreexported is controlled for national securityreasons.

(b) Reexports to and among specifiedcountries.

(1) Commodities that are not controlled fornuclear nonproliferation or missile technologyreasons and that are not listed in paragraph (b)(2)or (b)(3) of this section may be reexported to andamong Country Group A:1 and cooperatingcountries, provided that eligible commodities arefor use or consumption within a Country GroupA:1 (see Supplement No. 1 to part 740) orcooperating country, or for reexport from suchcountry in accordance with other provisions ofthe EAR.

(2) Except as provided in paragraph (b)(3) of thissection, cameras described in ECCN 6A003.b.4.band "military commodities" described in ECCN0A919 may not be exported under this paragraph(b).

(3) Cameras described in ECCN 6A003.b.4.bmay be exported or reexported to and among:Albania, Australia, Austria, Belgium, Bulgaria,Canada, Croatia, Cyprus, Czech Republic,Denmark, Estonia, Finland, France, Germany,Greece, Hungary, Iceland, Ireland, Italy, Japan,Latvia, Lithuania, Luxembourg, Malta, theNetherlands, New Zealand, Norway, Poland,Portugal, Romania, Slovakia, Slovenia, SouthAfrica, South Korea, Spain, Sweden, Switzerland,

Turkey, and the United Kingdom if:

(i) Such cameras are fully packaged for use asconsumer ready civil products; or,

(ii) Such cameras with not more than 111,000elements are to be embedded in civil products.

(c) Reexports to a destination to which directshipment from the United States is authorizedunder an unused outstanding license may be madeunder the terms of that license. Such reexportsshall be recorded in the same manner as exportsare recorded, regardless of whether the license ispartially or wholly used for reexport purposes.(See part 762 of the EAR for recordkeepingrequirements.)

(d) Reexports of any item from Canada that, atthe time of reexport, may be exported directlyfrom the United States to the new country ofdestination under any License Exception.

(e) Reexports (return) to the United States of anyitem. If the reexporting party requests writtenauthorization because the government of thecountry from which the reexport will take placerequires formal U.S. Government approval, suchauthorization will generally be given.

(f) Reexports from a foreign destination toCanada of any item if the item could be exportedto Canada without a license.

(g) Reexports between Switzerland andLiechtenstein.

(h) Shipments of foreign-made products thatincorporate U.S.-origin components may beaccompanied by U.S.-origin controlled spareparts, provided that they do not exceed 10 percentof the value of the foreign-made product, subjectto the restrictions in §734.4 of the EAR.

(i) Reexports to Sudan of items controlled byECCNs 2A994; 3A992.a; 5A991.g; 5A992;6A991; 6A998; 7A994; 8A992.d, .e, .f, and .g;



9A990.a and .b; and 9A991.d and .e. In addition,items in these ECCNs are not counted ascontrolled U.S. content for purposes ofdetermining license requirements for U.S. parts,components, and materials incorporated inforeign-made products. However, the exportfrom the United States to any destination withknowledge that they will be reexported directly orindirectly, in whole or in part to Sudan isprohibited without a license.

(j) Reexports of items controlled by NP Column1 (see Supplement No. 1 to part 774 of the EAR)to, among, and from countries described inCountry Group A:4 (see Supplement No. 1 to part740), except:

(1) Reexports from countries that are notidentified in Country Group A:1 of items that arecontrolled for NS reasons to destinations inCountry Group D:1; and

(2) Reexports to destinations in Country GroupE:2 and Country Group D:2.

§740.17

ENCRYPTION COMMODITIES, SOFT-WARE AND TECHNOLOGY (ENC)

License Exception ENC authorizes export andreexport of software and commodities andcomponents therefor that are classified underECCNs 5A002.a.1, a.2, a.5, a.6 or a.9, 5B002,5D002, and technology that is classified underECCN 5E002. This License Exception ENC doesnot authorize export or reexport to, or provisionof any service in any country listed in CountryGroup E:1 in Supplement No. 1 to part 740 of theEAR, or release of source code or technology toany national of a country listed in Country GroupE:1. Reexports and transfers under LicenseException ENC are subject to the criteria set forthin paragraph (c) of this section. Paragraph (d) ofthis section sets forth information about reviewrequests required by this section. Paragraph (e)

sets forth reporting required by this section.

(a) No prior review or post export reporting required

(1) Internal “development” or “production” ofnew products. License Exception ENCauthorizes exports and reexports of itemsdescribed in paragraph (a)(1)(i) of this section, toend-users described in paragraph (a)(1)(ii) of thissection, for the intended end-use described inparagraph (a)(1)(iii) of this section without priorreview by the U.S. Government.

(i) Eligible items. Eligible items are thoseclassified under ECCNs 5A002.a.1, .a.2, .a.5,.a.6, or .a.9, 5B002, 5D002, or 5E002.

(ii) Eligible End-users. Eligible end-users are'private sector end-users' wherever located, exceptto countries listed in Country Group E:1 (seeSupplement No. 1 to part 740 of the EAR) thatare headquartered in a country listed inSupplement No. 3 of this part.

Note to paragraph (a)(1)(ii): A 'private sectorend-user' is:

(1) An individual who is not acting onbehalf of any foreign government; or

(2) A commercial firm (including itssubsidiary and parent firms, and othersubsidiaries of the same parent) that is not whollyowned by, or otherwise controlled by or acting onbehalf of, any foreign government.

(iii) Eligible End-use. The eligible end-use isinternal “development” or “production” of newproducts by those end-users.

NOTE to paragraph (a)(1)(iii): All itemsproduced or developed with items exported orreexported under this paragraph (a)(1) aresubject to the EAR. These items may requirereview and authorization before sale, reexport ortransfer, unless otherwise authorized by license



or license exception.

(2) Exports and reexports to “U.S.Subsidiaries.” License Exception ENCauthorizes export and reexport of items classifiedunder ECCNs 5A002.a.1, .a.2, .a.5, .a.6, or .a.9,5B002, 5D002, or 5E002 to any “U.S.subsidiary,” wherever located, except to countrieslisted in Country Group E:1 (see Supplement No.1 to part 740 of the EAR), without prior reviewby the U.S. Government. License Exception ENCalso authorizes export or reexport of such itemsby a U.S. company and its subsidiaries to foreignnationals who are employees, contractors orinterns of a U.S. company or its subsidiaries if theitems are for internal company use, including the“development” or “production” of new products,without prior review by the U.S. Government.

NOTE to paragraph (a)(2): All items producedor developed with items exported or reexportedunder this paragraph (a)(2) are subject to theEAR. These items may require review andauthorization before sale, reexport or transfer,unless otherwise authorized by license or licenseexception.

(b) Prior review required

License Exception ENC authorizes the export andreexport of commodities and software that requirea license under ECCNs 5A002.a.1, a.2, a.5, a.6, ora.9, 5B002, or 5D002. Paragraph (b)(1)(i) of thissection also authorizes the export and reexport of“technology” controlled for EI reasons underECCN 5E002 to the end-users indicated inparagraph (b)(1)(i). Exports and reexportsauthorized under this paragraph (b) of LicenseException ENC require submission of a reviewrequest in accordance with paragraph (d) of thissection. License Exception ENC does notauthorize the export or reexport of cryptanalyticitems to any "government end-user". Export orreexport of items that provide an "opencryptographic interface" is only authorized underparagraph (b)(1)(i) of this section. Exports andreexports authorized under paragraph (b) of thissection are subject to reporting requirements in

accordance with paragraph (e) of this section.

(1) Review required without waiting period.Once your review request is registered with BISin accordance with paragraph (d) of this section,License Exception ENC authorizes the exports orreexports (except to countries listed in CountryGroup E:1 of Supplement No. 1 to part 740 ofthe EAR) to the following destinations:

(i) Export and reexport to countries listed inSupplement No. 3 of this part. LicenseException ENC authorizes the export andreexport of encryption items, including EIcontrolled commodities or software that arepending review for mass market treatment (under§742.15(b) of the EAR), to "governmentend-users" and non-"government end-users"located in countries listed in Supplement 3 of thispart, as well as to foreign subsidiaries or officesof firms, organizations and governmentsheadquartered in countries listed in Supplement 3of this part.

(ii) Export and reexport to countries notlisted in Supplement No. 3 of this part. LicenseException ENC authorizes the export andreexport of the following commodities andsoftware (except certain exports and reexports to"government end-users" as further described inparagraph (b)(2) of this section, or any "opencryptographic interface" item):

(A) Encryption commodities and software(including key management products), as follows:for symmetric algorithms with key lengths notexceeding 80 bits; for asymmetric algorithms withkey lengths not exceeding 1024 bits; and forelliptic curve algorithms with key lengths notexceeding 160 bits. (After review has beencompleted, the issued Commodity ClassificationAutomated Tracking System (CCATS) documentwill indicate authorization is under paragraph(b)(2) or (b)(3) of this section, whicheverparagraph is appropriate.)

(B) Encryption source code that would not



be eligible for export or reexport under LicenseException TSU, provided that a copy of thesource code is included in the review request, tonon-"government end-users" located in anycountry except a country listed in Country GroupE:1 of Supplement No. 1 to part 740 of the EAR.(After the review has been completed, the issuedCommodity Classification Automated TrackingSystem (CCATS) document will indicateauthorization is under paragraph (b)(2) of thissection.)

(2) Review required with 30 day wait (non-“government end-users” only). Thirty (30)days after your review request is registered withBIS in accordance with paragraph (d) of thissection and subject to the reporting requirementsin paragraph (e) of this section, LicenseException ENC authorizes the export or reexportof the following commodities and software to“government end-users” located or headquarteredin a country listed in Supplement 3 to this part,and also to non-“government end-users” locatedin a country not listed in Country Group E:1 ofSupplement No. 1 to part 740 of the EAR:

(i) Network infrastructure software andcommodities and components thereof (includingcommodities and software necessary to activateor enable cryptographic functionality in networkinfrastructure products) providing secure WideArea Network (WAN), Metropolitan AreaNetwork (MAN), Virtual Private Network (VPN),satellite, digital packet telephony/media (voice,video, data) over internet protocol, cellular ortrunked communications meeting any of thefollowing with key lengths exceeding 80-bits forsymmetric algorithms:

(A) Aggregate encrypted WAN, MAN, VPNor backhaul throughput (includes communicationsthrough wireless network elements such asgateways, mobile switches, controllers, etc)greater than 90 Mbps;

(B) Wire (line), cable or fiber-optic WAN,MAN or VPN single-channel input data rate

exceeding154 Mbps;

(C) Media (voice/video/data) encryption orcentralized key management supporting morethan 250 concurrent encrypted data channels, orencrypted signaling to more than 1,000 endpoints,for digital packet telephony / media(voice/video/data) over internet protocolcommunications; or

(D) Air-interface coverage (e.g., throughbase stations, access points to mesh networks,bridges, etc.) exceeding 1,000 meters, where anyof the following applies:

(1) Maximum transmission data ratesexceeding 10 Mbps (at operating ranges beyond1,000 meters);

(2) Maximum number of concurrentfull-duplex voice channels exceeding 30; or

(3) Substantial support is required forinstallation or use;

(ii) Encryption source code that would not beeligible for export or reexport under LicenseException TSU because it is not publiclyavailable as that term is used in §740.13(e)(1) ofthe EAR, and the export or reexport of theencryption source code is not otherwise eligiblefor License Exception ENC under paragraph(b)(1)(ii)(B) of this section;

(iii) Encryption software, commodities orcomponents therefor, that have any of thefollowing:

(A) Been designed, modified, adapted orcustomized for “government end-user(s)” orgovernment end-use (e.g., to secure police, states e c u r i t y , o r e m e r g e n c y r e s p o n s ecommunications), including encryptioncommodities and software for external securityoperations center (SOC) / network operationscenter (NOC) command and infrastructure, publicsafety radio, and digital forensics / computer



forensics;

(B) Cryptographic functionality that hasbeen modified or customized to customerspecification; or

(C) Cryptographic functionality or“encryption component” (except encryptionsoftware that would be considered publiclyavailable, as that term is used in §740.13(e)(1) ofthe EAR) that is user-accessible and can be easilychanged by the user;

(iv) “Cryptanalytic items”;

(v) Encryption commodities and software thatprovide functions necessary for quantumcryptography, as defined in ECCN 5A002 of theCommerce Control List;

(vi) Encryption commodities and software thathave been modified or customized for computersclassified under ECCN 4A003.

(3) Review required with 30 day waitingperiod (“government end-users” or non-“government end-users”). Thirty days afteryour review request is registered with BIS inaccordance with paragraph (d) of this section,License Exception ENC authorizes the exportand reexport of software and commodities andcomponents not listed in paragraph (b)(2) of thissection to either “government end-users” or non-“government end-users” located in a country notlisted in Country Group E:1 of Supplement No. 1to part 740 of the EAR.

(4) Items excluded from review requirements.License Exception ENC authorizes the export andreexport of the commodities and softwaredescribed in this paragraph (b)(4) without review(for encryption reasons) by BIS, except thatparagraph (b)(4)(ii) of this section does notauthorize exports from the United States offoreign products developed with or incorporatingU.S.-origin encryption source code, components,or toolkits.

(i) Short-range wireless encryptionfunctions. Commodities and software nototherwise controlled in Category 5, but that areclassified under ECCN 5A002, 5B002 or 5D002only because they incorporate components orsoftware that provide short-range wirelessencryption functions (e.g., with a nominaloperating range not exceeding 100 metersaccording to the manufacturer's specifications).Commodities and software included in thisdescription include those designed to comply withthe Institute of Electrical and ElectronicEngineers (IEEE) 802.11 wireless LAN standard(35 meters) for short-range use and thosedesigned to comply with the IEEE 802.15.1standard that provide only the short-rangewireless encryption functionality, and would notbe classified under Category 5, part 1 of the CCL(telecommunications) absent this encryptionfunctionality. Certain items excluded fromreview by this paragraph may also be excludedfrom review under paragraph (b)(4)(iv) of thissection (commodities and software that provide“ancillary cryptography”).

(ii) Foreign products developed with orincorporating U.S.-origin encryption sourcecode, components, or toolkits. Foreign productsdeveloped with or incorporating U.S.-originencryption source code, components or toolkitsthat are subject to the EAR, provided that theU.S.-origin encryption items have previously beenreviewed and authorized by BIS (or elseauthorized for export under License ExceptionTSU upon meeting the notification requirementsof section 740.13(e) of the EAR, without needfor further review) and the cryptographicfunctionality has not been changed. Suchproducts include foreign-developed products thatare designed to operate with U.S. productsthrough a cryptographic interface.

(iii) [RESERVED]

(iv) “Ancillary cryptography.” Commoditiesand software that perform “ancillarycryptography.” See Nota Bene of definition of



“ancillary cryptography” in §772.1 of the EAR.

NOTE to paragraph (b): A new productreview is required if a change is made to thecryptographic functionality (e.g., algorithms) orother technical characteristics affecting LicenseException ENC eligibility (e.g., encryptedthroughput) of the originally reviewed product.However, a new product review is not requiredwhen a change involves: the subsequentbundling, patches, upgrades or releases of aproduct; name changes; or changes to apreviously reviewed encryption product where thechange is limited to updates of encryptionsoftware components where the product isotherwise unchanged.

(c) Reexport and transfer

U.S. or foreign distributors, resellers or otherentities who are not original manufacturers ofencryption commodities and software arepermitted to use License Exception ENC only ininstances where the export or reexport meets theapplicable terms and conditions of this section.Transfers of encryption items listed in paragraph(b)(2) of this section to “government end-users,”or for government end-uses, within the samecountry are prohibited, unless otherwiseauthorized by license or license exception.

(d) Review request procedures

(1) Submission. To request review of yourencryption items under License Exception ENC,you must submit to BIS and to the ENCEncryption Request Coordinator form BIS-748P(Multipurpose Application), or its electronicequivalent in accordance with the instructions inparagraph (r) of Supplement No. 2 to part 748“Unique Application and SubmissionRequirements” and the applicable informationdescribed in paragraphs (a) through (e) ofSupplement No. 6 to part 742 of the EAR(Guidelines for Submitting Review Requests forEncryption Items). Failure to properly completethese items may delay consideration of your

review request.

(2) Action by BIS.

(i) Notification. Upon completion of its review,BIS will send you written notice of the provisionsof this section, if any, under which your itemsmay be exported or reexported.

(ii) After 30 days. If BIS has not, within 30days of registration of a complete review requestfrom you, informed you that your item is notauthorized for License Exception ENC, you mayexport or reexport under the applicable provisionsof License Exception ENC.

(iii) Hold Without Action (HWA). BIS mayhold your review request without action ifnecessary to obtain additional information or forany other reason necessary to ensure an accuratedetermination with respect to ENC eligibility.Time on such “hold without action” status shallnot be counted towards fulfilling the 30 daywaiting period specified in this paragraph and inparagraphs (b)(2) and (b)(3) of this section. BISmay require you to supply additional relevanttechnical information about your encryptionitem(s) or information that pertains to theireligibility for License Exception ENC at anytime, before or after the expiration of the 30 daywaiting period specified in this paragraph and inparagraphs (b)(2) and (b)(3) of this section. Ifyou do not supply such information within 14days after receiving a request for it from BIS, BISmay return your review request(s) without actionor otherwise suspend or revoke your eligibility touse License Exception ENC for that item(s). Atyour request, BIS may grant you up to anadditional 14 days to provide the requestedinformation. Any request for such an additionalnumber of days must be made prior to the date bywhich the information was otherwise due to beprovided to BIS, and may be approved if BISconcludes that additional time is necessary.



(e) Reporting requirements

(1) Semi-annual reporting requirement.Semi-annual reporting is required for exports toall destinations other than Canada, and forreexports from Canada, under this licenseexception. Certain encryption items andtransactions are excluded from this reportingrequirement, see paragraph (e)(1)(iii) of thissection. For information about what must beincluded in the report and submissionrequirements, see paragraphs (e)(1)(i) and(e)(1)(ii) of this section respectively.

(i) Information required. Exporters mustinclude for each item, the CommodityClassification Automated Tracking System(CCATS) number and the name of the item(s)exported (or reexported from Canada), and thefollowing information in their reports:

(A) Distributors or resellers. For itemsexported (or reexported from Canada) to adistributor or other reseller, including subsidiariesof U.S. firms, the name and address of thedistributor or reseller, the item and the quantityexported or reexported and, if collected by theexporter as part of the distribution process, theend-user’s name and address;

(B) Individual consumers. For itemsexported (or reexported from Canada) toindividual consumers through direct sale, thename and address of the recipient, the item, andthe quantity exported; or

(C) Foreign manufacturers and productsthat use encryption items. For exports (i.e.,from the United States) or direct transfers (e.g.,by a "U.S. subsidiary" located outside the UnitedStates) of encryption components, source code,general purpose toolkits, equipment controlledunder ECCN 5B002, technology, or items thatprovide an “open cryptographic interface”, to aforeign developer or manufacturer headquarteredin a country not listed in Supplement No. 3 tothis part when intended for use in foreign

products developed for commercial sale, thenames and addresses of the manufacturers usingthese encryption items and, if known, when theproduct is made available for commercial sale, anon-proprietary technical description of theforeign products for which these encryption itemsare being used (e.g., brochures, otherdocumentation, descriptions or other identifiers ofthe final foreign product; the algorithm and keylengths used; general programming interfaces tothe product, if known; any standards or protocolsthat the foreign product adheres to; and sourcecode, if available).

(ii) Submission requirements. For exportsoccurring between January 1 and June 30, areport is due no later than August 1 of that year.For exports occurring between July 1 andDecember 31, a report is due no later thanFebruary 1 the following year. These reportsmust be provided in electronic form.Recommended file formats for electronicsubmission include spreadsheets, tabular text orstructured text. Exporters may request otherreporting arrangements with BIS to better reflecttheir business models. Reports may be sentelectronically to BIS at [email protected] and tothe ENC Encryption Request Coordinator [email protected], or disks and CDs containing thereports may be sent to the following addresses:

(A) Department of Commerce, Bureau ofIndustry and Security, Office of National Securityand Technology Transfer Controls, 14th Streetand Pennsylvania Ave., N.W., Room 2705,Washington, D.C. 20230, Attn: EncryptionReports, and

(B) Attn: ENC Encryption RequestCoordinator, 9800 Savage Road, Suite 6940, Ft.Meade, MD 20755-6000.

(iii) Exclusions from reporting requirement.Reporting is not required for the following itemsand transactions:

(A) Any encryption item exported (or



reexported from Canada) under paragraph (a) ofthis section;

(B) Encryption commodities or softwarewith a symmetric key length not exceeding 64bits;

(C) Encryption commodities or softwareauthorized under paragraph (b)(3) of this section,exported (or reexported from Canada) toindividual consumers;

(D) Encryption items exported (orreexported from Canada) via free and anonymousdownload;

(E) Encryption items from or to a U.S. bank,financial institution or its subsidiaries, affiliates,customers or contractors for banking or financialoperations;

(F) Items listed in paragraph (b)(4) of thissection, unless it is a foreign item described inparagraph (b)(4)(ii) of this section that hasentered the United States;

(G) Foreign products developed by bundlingor compiling of source code;

(H) General purpose operating systems, ordesktop applications (e.g., e-mail, browsers,games, word processing, data base, financialapplications or utilities) authorized underparagraph (b)(3) of this section;

(I) Client Internet appliance and clientwireless LAN cards; or

(J) Other items as determined on a case-by-case basis.

(2) Reporting key length increases. Reportingis required for commodities and software that,after having been reviewed and authorized forLicense Exception ENC by BIS, are modifiedonly to upgrade the key length used forconfidentiality or key exchange algorithms. Suchitems may be exported or reexported under the

previously authorized provision of LicenseException ENC without further review.

(i) Information required.

(A) A certification that no change to theencryption functionality has been made other thanto upgrade the key length for confidentiality orkey exchange algorithms.

(B) The original Commodity ClassificationAutomated Tracking System (CCATS)authorization number issued by BIS and the dateof issuance.

(C) The new key length.

(ii) Submission requirements.

(A) The report must be received by BIS andthe ENC Encryption Request Coordinator beforethe export or reexport of the upgraded product;and

(B) The report is e-mailed [email protected] and [email protected].

§740.18

AGRICULTURAL COMMODITIES (AGR)

(a) Eligibility requirements

License Exception AGR permits the export ofagricultural commodities to Cuba, as well as thereexport of U.S. origin agricultural commoditiesto Cuba, provided your transaction meets all ofthe following criteria:

(1) The commodity meets the definition of“agricultural commodities” in part 772 of theEAR;

(2) The commodity is EAR99. You must have anofficial commodity classification of EAR99 fromBIS for fertilizers, western red cedar and live

mailto:[email protected].



horses before you submit a notification under thislicense exception. See §748.3 of the EAR forinformation on how to submit a commodityclassification request;

(3) The export or reexport is made pursuant to awritten contract, except for donations andcommercial samples which are not subject to thiscontract requirement;

(4) The export or reexport is made within 12months of the signing of the contract or within 12months of notification that no objections wereraised (if no contract is required). In the case ofmultiple partial shipments, all such shipmentsmust be made within the 12 months of the signingof the contract or within 12 months of notificationthat no objections were raised (if no contract isrequired); and

(5) You notify BIS prior to exporting orreexporting according to the procedures set forthin paragraph (c) of this section. If you intend toengage in multiple shipments during the one-yearperiod after the signing of the contract, you needonly notify BIS prior to the first shipment.

(b) Restrictions

(1) No export or reexport to any individual orentity designated as a Specially DesignatedTerrorist or Foreign Terrorist Organization maybe made under License Exception AGR (see part744 of the EAR).

(2) No export or reexport to or for use inbiological, chemical, nuclear warfare or missileproliferation activities may be made underLicense Exception AGR (see part 744 of theEAR).

(3) No U.S.-owned or controlled foreign firm mayexport from abroad to Cuba a foreign producedagricultural commodity containing more than10% U.S.-origin content. Such U.S.-owned orcontrolled foreign firms require a specific licensefrom BIS as well as the Department of the

Treasury’s Office of Foreign Assets Control(OFAC). Transactions not subject to the EAR(under 10% U.S.-origin content) require a licensefrom OFAC.

(c) Prior notification

(1) General requirement. You must notify BISprior to any export or reexport (or prior to thefirst of multiple shipments) under LicenseException AGR.

(2) Procedures. You must provide priornotification of exports and reexports underLicense Exception AGR by submitting acompleted application in accordance with§ 748.1 of the EAR. The following blocks mustbe completed, as appropriate: Blocks 1, 2, 3, 4, 5(by marking box 5 “Other”), 14, 16, 17,18, 19, 21,22 (a), (e), (f), (g), (h), (i), (j), 23, and 25according to the instructions described inSupplement No. 1 to part 748 of the EAR. If yourcommodity is fertilizer, western red cedar or livehorses, you must confirm that BIS has previouslyclassified your commodity as EAR99 by placingthe Commodity Classification AutomaticTracking System (CCATS) number in block22(d). BIS will not initiate the registration of anAGR notification unless the application iscomplete.

(3) Action by BIS. Within two business days ofthe registration of the AGR notification, BIS willrefer the notification for interagency review, or ifnecessary return the notification without action(e.g., if the information provided is incomplete).Registration is defined as the point at which thenotification is entered into BIS's electronicsystem.

(4) Review by other departments or agencies.The Departments of Defense, State, and otheragencies, as appropriate, may review the AGRnotification. BIS must receive department oragency objections within nine business days ofthe referral. Unlike the provisions described in§750.4(b) of the EAR, there are no provisions for



stopping the processing time of the AGRnotification. If, within 11 business days after thedate of registration, any reviewing agencyprovides a written objection that the recipientmay promote international terrorism or thetransaction raises nonproliferation concerns, youmay not use License Exception AGR. In suchcases, BIS will notify you that a license isrequired for the export or reexport. BIS will thenprocess the AGR notification as a licenseapplication in accordance with the provisionsdescribed in §750.4 of the EAR, and the licensingpolicies set forth in the EAR. At this time, BISmay request additional information. When BISconfirms that no agency has raised an objectionwithin eleven business days (as described inparagraph (c)(5) of this section), you may proceedwith the transaction provided that you satisfy allother requirements of License Exception AGR,including the requirement to have a writtencontract prior to any shipment (unless a donationor commercial sample). (Note that the fact thatyou have been advised that no agency hasobjected to the transaction does not exempt youfrom other licensing requirements under the EAR,such as those based on knowledge of a prohibitedend-use or end-user as referenced in generalprohibition five (part 736 of the EAR) and setforth in part 744 of the EAR.)

(5) Status of pending AGR notificationrequests. You must contact BIS's System forTracking Export License Applications(“STELA”) at (202) 482-2752 for status of yourpending AGR notification. (See §750.5 of theEAR for procedures to access information onSTELA.) STELA will provide the date ofregistration of the AGR notification. If nodepartment or agency objection is raised within11 business days, STELA will, on the twelfthbusiness day following the date of registration,provide you with confirmation of that fact. Youmay not proceed with your shipment unless youconfirm with STELA that no objection has beenraised. BIS will subsequently issue writtenconfirmation to you. If an objection is raised,STELA will indicate that a license is required.

The AGR notification will then be processed as alicense application. In addition, BIS may providenotice of an objection by telephone, fax, courierservice, or other means.

(d) Donations

(1) Donations of agricultural commodities areeligible for export and reexport to Cuba underLicense Exception AGR, provided the transactionmeets the requirements and procedures of thislicense exception (except the written contractrequirement).

(2) Donations of food items to non-governmentalorganizations (NGOs) and individuals in Cubamay also be eligible for License Exception GFT.See §740.12 for eligibility requirements of giftparcels and humanitarian donations under LicenseException GFT.

§740.19

CONSUMER COMMUNICATIONSDEVICES (CCD)

(a) Authorization

This License Exception authorizes the export orreexport of commodities and software describedin paragraph (b) to Cuba subject to the conditionsin paragraphs (c) and (d) of this section. Thissection does not authorize U.S.-owned or-controlled entities in third countries to engage inreexports of foreign produced commodities toCuba for which no license would be issued by theTreasury Department pursuant to 31 CFR515.559. Cuba is the only eligible destinationunder this License Exception.

(b) Eligible Commodities and software

Commodities and software eligible for export orreexport under this section are:

(1) Computers designated EAR99 or classified



under Export Control Classification Number(ECCN) 4A994.b that do not exceed an adjustedpeak performance of 0.02 weighted teraflops;

(2) Disk drives and solid state storage equipmentclassified under ECCN 5A992 or designatedEAR99;

(3) Input/output control units (other thanindustrial controllers designed for chemicalprocessing) designated EAR99;

(4) Graphics accelerators and graphicscoprocessors designated EAR99;

(5) Monitors classified under ECCN 5A992 ordesignated EAR99;

(6) Printers classified under ECCN 5A992 ordesignated EAR99;

(7) Modems classified under ECCNs 5A991.b.2,or 5A992 or designated EAR99;

(8) Network access controllers andcommunications channel controllers classifiedunder ECCN 5A991.b.4 or designated EAR99;

(9) Keyboards, mice and similar devicesdesignated EAR99;

(10) Mobile phones, including cellular andsatellite telephones, personal digital assistants,and subscriber information module (SIM) cardsand similar devices classified under ECCNs5A992 or 5A991 or designated EAR99;

(11) Memory devices classified under ECCN5A992 or designated EAR99;

(12) “Information security” equipment,“software” (except “encryption source code”) andperipherals classified under ECCNs 5A992 or5D992 or designated EAR99;

(13) Digital cameras and memory cards classifiedunder ECCN 5A992 or designated EAR99;

(14) Television and radio receivers classifiedunder ECCN 5A992 or designated EAR99;

(15) Recording devices classified under ECCN5A992 or designated EAR99;

(16) Batteries, chargers, carrying cases andaccessories for the equipment described in thisparagraph that are designated EAR99; and

(17) “Software” (except “encryption sourcecode”) classified under ECCNs 4D994, 5D991 or5D992 or designated EAR99 to be used forequipment described in this paragraph (b).

(c) Donation Requirement

This License Exception authorizes the export orreexport of eligible commodities and softwarethat will be donated by the exporter or reexporterto an eligible end-user or to eligible end-usersfree of charge. The payment by an end-user ofany handling charges arising within the importingcountry or any charges levied by the governmentof the importing country shall not be considered acharge for purposes of this paragraph.

(d) Eligible End-users

(1) Organizations. This License Exception maybe used to export or reexport eligiblecommodities and software to and for the use ofindependent non-governmental organizations.The Cuban Government or the Cuban CommunistParty and organizations they administer or controlare not eligible end-users.

(2) Individuals. This License Exception may beused to export eligible commodities and softwareto and for the use of individuals other than thefollowing officials of the Cuban Government andCuban Communist Party:

(i) Ineligible Cuban Government Officials.Ministers and vice-ministers; members of theCouncil of State; members of the Council ofMinisters; members and employees of the



National Assembly of People's Power; membersof any provincial assembly; local sector chiefs ofthe Committees for the Defense of theRevolution; Director Generals and sub-DirectorGenerals and higher of all Cuban ministries andstate agencies; employees of the Ministry of theInterior (MININT); employees of the Ministry ofDefense (MINFAR); secretaries and firstsecretaries of the Confederation of Labor of Cuba(CTC) and its component unions; chief editors,editors and deputy editors of Cuban state-runmedia organizations and programs, including

newspapers, television, and radio; or membersand employees of the Supreme Court (TribunoSupremo Nacional).

(ii) Ineligible Cuban Communist PartyOfficials. Members of the Politburo; the CentralCommittee; Department Heads of the CentralCommittee; employees of the Central Committee;and the secretaries and first secretaries ofprovincial Party central committees.

License Exceptions Supplement No. 1 to section 740.11--page 1


SUPPLEMENT NO. 1 TO §740.11 - ADDITIONAL RESTRICTIONS ON USE OF LICENSE EXCEPTION GOV

(a) Items for official use within nationalterritory by agencies of a Cooperating Government

License Exception GOV is available for all itemsconsigned to and for the official use of anyagency of a cooperating government within theterritory of any cooperating government, except:

(1) Items identified on the Commerce ControlList as controlled for national security (NS)reasons under Export Control ClassificationNumbers (ECCNs) as follows for export orreexport to destinations other than Austria,Belgium, Canada, Denmark, Finland, France,Germany, Greece, Ireland, Italy, Luxembourg, theNetherlands, Portugal, Spain, Sweden, or theUnited Kingdom: 1C001, 5A001.b.5,6A001.a.1.b.1 object detection and locationsystems having a sound pressure level exceeding210 dB (reference 1 µPa at 1 m) for equipmentwith an operating frequency in the band from 30Hz to 2 kHz inclusive, 6A001.a.2.a.1,6A001.a.2.a.2, 6A001.a.2.a.3, 6A001.a.2.a.5,6A001.a.2.6, 6A001.a.2.b, 6A001.a.2.e,6A002.a.1.c, 6A008.l.3, 6B008, 8A001.b,8A001.d, 8A002.o.3.b; and

(i) “Composite” structures or laminatescontrolled by 1A002.a, consisting of an organic“matrix” and made from materials controlled by1C010.c or 1C010.d; and

(ii) [RESERVED]

(iii) [RESERVED]




(A) [RESERVED]





(F) Controlled by 8D001, specially designedfor the “development” or “production” ofequipment controlled by 8A001.b, 8A001.d, or8A002.o.3.b;

(G) Controlled by 9D001, specially designedor modified for the “development” of equipmentor “technology” controlled by 9A011, 9E003.a.1,or 9E003.a.3.a; and

(H) Controlled by 9D002,specially designedor modified for the “production” of equipmentcontrolled by 9A011;

(vii) “Technology”, as follows:

(A) Controlled by 1E001 for items controlledby 1A002.a as described by paragraph (a)(1)(i) ofthis Supplement, or 1C001; and

(B) [RESERVED]

(C) Controlled by 5E001.a for the“development” or “production” of digitally



controlled radio receivers controlled by5A001.b.5; or 5D001.a for “software” speciallydesigned for the “development” or “production”of digitally controlled radio receivers controlledby 5A001.b.5; and

(D) Controlled by 6E001 for the“development” of equipment or “software” in6A001.a.1.b.1, 6A001.a.2.a.1, 6A001.a.2.a.2,6A001.a.2.a.3, 6A001.a.2.a.5, 6A001.a.2.a.6,6A001.a.2.b, 6A001.a.2.c, 6A001.a.2.e,6A001.a.2.f, 6A002.a.1.c, 6A008.l.3, 6B008,6D001 (specially designed for the “production” or“development” of equipment in 6A008.1.3 or6B008), or 6D003.a as described in paragraph(a)(1) of this Supplement; and

(E) Controlled by 6E002 for the“production” of equipment controlled by6A001.a.1.b.1, 6A001.a.2.a.1, 6A001.a.2.a.2,6A001.a.2.a.3, 6A001.a.2.a.5, 6A001.a.2.a.6,6A001.a.2.b, 6A001.a.2.c, 6A001.a.2.e,6A001.a.2.f, 6A002.a.1.c, 6A008.l.3, or 6B008,as described in paragraph (a)(1) of thisSupplement; and

(F) Controlled by 8E001 for itemscontrolled by 8A001.b, 8A002.o.3.b, or 8A001.d;and

(G) Controlled by 9E001 for the“development” of equipment or “software” in9A011, 9D001 for the “development” of 9A011,or 9D002 for the “production” of 9A011; and

(H) Controlled by 9E002 for the“production” of equipment in 9A011; and

(I) Controlled by 9E003.a.1; and

(J) Controlled by 9E003.a.3.a;

(2) Items identified on the Commerce ControlList as controlled for missile technology (MT),chemical and biological warfare (CB), or nuclearnonproliferation (NP) reasons;

(3) Regional stability items controlled underExport Control Classification Numbers (ECCNs)6A002.a.1.c, 6E001 technology according to theGeneral Technology Note for the “development”of equipment in 6A002.a.1.c, and 6E002technology according to the General TechnologyNote for the “production” of equipment in6A002.a.1.c; or

(4) Encryption items controlled for EI reasons asdescribed in the Commerce Control List.

(b) Diplomatic and consular missions of a cooperating government

License Exception GOV is available for all itemsconsigned to and for the official use of adiplomatic or consular mission of a cooperatinggovernment located in any country in CountryGroup B (see Supplement No. 1 to part 740),except:

(1) Items identified on the Commerce ControlList as controlled for national security (NS)reasons under Export Control ClassificationNumbers (ECCNs) as follows for export orreexport to destinations other than Austria,Belgium, Canada, Denmark, Finland, France,Germany, Greece, Ireland, Italy, Luxembourg, theNetherlands, Portugal, Spain, Sweden, or theUnited Kingdom: 1C001, 5A001.b.5,6A001.a.1.b.1 object detection and locationsystems having a sound pressure level exceeding210 dB (reference 1 µPa at 1 m) for equipmentwith an operating frequency in the band from 30Hz to 2 kHz inclusive, 6A001.a.2.a.1,6A001.a.2.a.2, 6A001.a.2.a.3, 6A001.a.2.a.5,6A001.a.2.a.6, 6A001.a.2.b, 6A001.a.2.e,6A002.a.1.c, 6A008.l.3, 6B008, 8A001.b,8A001.d, 8A002.o.3.b; and

(i) “Composite” structures or laminatescontrolled by 1A002.a, having an organic“matrix” and made from materials listed under1C010.c or 1C010.d; and

(ii) [RESERVED]



(iii) [RESERVED]




(A) [RESERVED]





(F) Controlled by 8D001, specially designedfor the “development” or “production” ofequipment controlled by 8A001.b, 8A001.d, or8A002.o.3.b;

(G) Controlled by 9D001, specially designedor modified for the “development” of equipmentor “technology” controlled by 9A011, 9E003.a.1,or 9E003.a.3.a; and

(H) Controlled by 9D002,specially designedor modified for the “production” of equipmentcontrolled by 9A011;

(vii) “Technology”, as follows:

(A) Controlled by 1E001 for itemscontrolled by 1A002.a as described by paragraph(a)(1)(i) of this Supplement, or 1C001; and

(B) [RESERVED]

(C) Controlled by 5E001.a for the“development” or “production” of digitallycontrolled radio receivers controlled by5A001.b.5; or 5D001.a for “software” speciallydesigned for the “development” or “production”of digitally controlled radio receivers controlledby 5A001.b.5; and

(D) Controlled by 6E001 for the“development” of equipment or “software” in6A001.a.1.b.1, 6A001.a.2.a.1, 6A001.a.2.a.2,6A001.a.2.a.3, 6A001.a.2.a.5, 6A001.a.2.a.6,6A001.a.2.b, 6A001.a.2.c, 6A001.a.2.e,6A001.a.2.f, 6A002.a.1.c, 6A008.l.3, 6B008,6D001 (specially designed for the “production” or“development” of equipment in 6A008.1.3 or6B008), or 6D003.a as described in paragraph(a)(1) of this Supplement; and

(E) Controlled by 6E002 for the“production” of equipment controlled by6A001.a.1.b.1, 6A001.a.2.a.1, 6A001.a.2.a.2,6A001.a.2.a.3,, 6A001.a.2.a.5, 6A001.a.2.a.6,6A001.a.2.b, 6A001.a.2.c, 6A001.a.2.e,6A001.a.2.f, 6A002.a.1.c, 6A008.l.3, or 6B008,as described in paragraph (a)(1) of thisSupplement; and

(F) Controlled by 8E001 for items controlledby 8A001.b, 8A002.o.3.b, or 8A001.d; and

(G) Controlled by 9E001 for itemscontrolled by 9D001; and

(H) Controlled by 9E002 for the productionof 9A011; and

(I) Controlled by 9E003.a.1; and

(J) Controlled by 9E003.a.3.a;

(2) Items identified on the Commerce ControlList as controlled for missile technology (MT),chemical and biological warfare (CB), or nuclearnonproliferation (NP) reasons;



(3) Regional stability items controlled underExport Control Classification Numbers (ECCNs)6A002.a.1.c, 6E001 technology according to theGeneral Technology Note for the “development”of equipment in 6A002.a.1.c, and 6E002technology according to the General Technology

Note for the “production” of equipment in6A002.a.1.c; or

(4) Encryption items controlled for EI reasons asdescribed in the Commerce Control List.


License Exceptions Supplement No. 1 Part 740

SUPPLEMENT NO. 1 TO PART 740

Supplement No. 1 to part 740 is not formatted for this document. Please see file 740spir.


License Exceptions Supplement No. 2 to part 740

SUPPLEMENT NO. 2 TO PART 740 - ITEMS THAT MAY BE DONATED TO MEET BASICHUMAN NEEDS UNDER THE HUMANITARIAN LICENSE EXCEPTION

(a) Health

Equipment for the Handicapped

Hospital Supplies and Equipment

Laboratory Supplies and Equipment

Medical Supplies and Devices

Medicine-Processing Equipment

Medicines

Vitamins

Water Resources Equipment

Food

Agricultural Materials and Machinery Suited toSmall-Scale Farming Operations

Agricultural Research and Testing Equipment

Fertilizers

Fishing Equipment and Supplies Suited toSmall-Scale Fishing Operations

(b) Food

Insecticides

Pesticides

Seeds

Small-Scale Irrigation Equipment

Veterinary Medicines and Supplies

(c) Clothes and Household Goods

Bedding

Clothes

Cooking Utensils

Fabric

Personal Hygiene Items

Soap-Making Equipment

Weaving and Sewing Equipment

(d) Shelter

Building Materials

Hand Tools

(e) Education

Books

Individual School Supplies

School Furniture

Special Education Supplies and Equipment forthe Handicapped

(f) Basic Support Equipment and SuppliesNecessary to Operate and Administer

the Donative Program

Audio-Visual Aids for Training

Generators

Office Supplies and Equipment

License Exceptions Supplement No. 3 to part 740


SUPPLEMENT NO. 3 TO PART 740 - License Exception ENC Favorable Treatment Countries

Australia AustriaBelgiumBulgariaCanadaCyprusCzech RepublicDenmark EstoniaFinlandFranceGermanyGreeceHungaryIcelandIrelandItalyJapanLatviaLithuaniaLuxembourgMaltaNetherlandsNew ZealandNorwayPolandPortugalRomaniaSlovakiaSloveniaSpainSwedenSwitzerlandTurkeyUnited Kingdom

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