Export Control
Overview
Developments
Administrative Entities
Export
Control Legislation
Licensing Procedures
Licensing Nuclear Items
Enforcement
Export Control Legislation
Review of the Export Control System of Ukraine (May 2002)
Export Control Administrative Structure Chart (clickable)
This section contains a comprehensive
overview of the Ukrainian export control
system, as well as an analytical review of the system by CNS Research Assistant
Eduard Fesko. Links to 1997 and 1998 reports on Ukrainian export
controls, including information on administrative
bodies involved in export controls, key legislation and decrees governing
export controls, the export licensing process, the status of international
and bilateral agreements in the export control sphere, a list of controlled
commodities, and an assessment
of the entire Ukrainian export control system, can be found at the end of this
file.
Sections of this report
were originally prepared by the Center for
Nonproliferation Studies of the Monterey Institute of International Studies
under a grant from the United States Department of Energy's Office of Nonproliferation
and Arms Control. The views expressed in this report are those of
the authors alone, and do not necessarily represent the views of the Department
of Energy or the United States Government.
Introduction
When it became an independent state on 24 August 1991, Ukraine
possessed a large nuclear weapons arsenal that represented as much as 15 percent of the Soviet
total. Next to the Russian Federation, it also possessed the largest
civilian nuclear power program in the former Soviet Union, ranking in the top ten worldwide in terms of operational reactors and total
capacity. In addition, it claimed a well-developed
nuclear research
infrastructure, uranium mines,
chemical plants for processing uranium
ore, tens of kilograms of HEU in bulk form, heavy water production capabilities, and a number of nuclear-related dual-use commodities such as zirconium, hafnium, and ion-exchange resins. Ukraine also inherited a large military industrial base equipped to manufacture ballistic missiles. Indeed, the
Pivdenmash (Yuzhmash) Production
Association was the largest missile factory in the world. Ukraine also manufactured solid rocket engines at the
Pavlohrad Chemical Plant and produced ICBM control and guidance systems at the
Khartron Scientific Production Association in
Kharkiv.[1] Ukraine’s military industrial base, moreover, extended well beyond that of the nuclear and missile sectors. At the time of the collapse of the Soviet Union, it was estimated to have had approximately 15 percent of the former Soviet defense plants and military
research and development facilities.[2]
Although rich in defense-related production capabilities with a
large nuclear energy and missile production capacity, Ukraine inherited very little in the way of export control structures or expertise. Over the past decade, Ukraine has taken steps to set up an export control
system by creating governmental bodies,
legislation, and
licensing procedures to
help prevent the illicit transfer of nuclear, missile, and dual-use items from
its territory. In addition, Ukraine has become a member of several
international export
control-related organizations, including the NPT, MTCR, NSG, and Wassenaar
Arrangement.
Administrative
Entities
The main export control entities in Ukraine
are the Committee for Policy on Military
Cooperation and Export Control and the State
Service for Export Control (Derzheksportkontrol). For information on
these and other entities with export control responsibilities in Ukraine, see
the table below or click on the organization
chart.
|
Governmental or Quasi-Governmental Entity |
Export Control
Responsibilities |
|
President |
Issues export control-related decrees.
Reviews license applications as needed.[2,3] |
|
National Security and
Defense Council |
Oversees the
Committee for
Policy on Military-Technical Cooperation and Export Control.[2,3] |
|
Verkhovna Rada (parliament) |
Two Rada commissions have a particular interest in
the sphere of export controls: the Rada Commission on Defense and State
Security and the Rada Commission on Foreign Affairs.[3] |
|
Cabinet of Ministers |
Oversees the development of the state
export control system. Grants authority to companies to engage in
trade of military items. Issues decrees and approves procedures regarding
export control policy. Confirms control lists.[1] |
|
Committee for Policy on Military-Technical Cooperation
and Export Control |
Evaluates license applications. Oversees the State Service for Export
Control.[2,3] |
|
Ministry of Defense |
Provides consultation to the State Service for Export
Control on applications for the export of conventional arms, missile technology, and other military
items. Assesses the actual need of the recipient country for military goods.[1] |
| Ministry of the Environment and Natural
Resources |
Develops security measures for the
protection of the environment during the international transfer of
goods. Advises the State Service for Export
Control on the transportation of items that can be
used to create chemical, biological, or toxin weapons.[1] |
|
Ministry of
the Economy |
Develops recommendations for limiting the export of certain goods. Evaluates the need for a
given export. Establishes end-use violations. Authenticates
documents provided by exporter.[1] |
|
Ministry of
Environmental Protection and Nuclear Safety (MEPNS) |
The Nuclear Regulatory Administration of the MEPNS
makes recommendations to the State Service for Export Control regarding license
applications for the export of nuclear-related items. |
|
Ministry of Foreign Affairs |
Advises the State Service for Export
Control on changes in
international export control regimes, export rulings rendered by other
countries, and foreign policy implications of particular export
applications. Conducts end-use checks in foreign countries.[1]
|
| Ministry of Health |
Issues permits for the transportation
of nuclear-related goods.[1] |
|
Ministry of Industrial
Policy |
Advises the State Service for Export
Control on the export of
goods designed or manufactured with financing from the state
budget. Assists exporters with export control implementation.
Oversees adherence of subordinate enterprises to export control
procedures.[1] |
|
National
Space Agency of Ukraine |
Advises the State Service for Export
Control on the international transfer of items included on the missile
control list.[1] |
|
Scientific and Technical Center on Export and Import of Special
Technologies, Hardware and Materials (STC) |
Installs internal compliance systems
at Ukrainian enterprises. Conducts seminars and education programs
on nonproliferation and export control.[4] |
|
Security Service |
Investigates alleged
export control violations and smuggling activities. Takes measures to
protect state secrets and technical information during the international
transfer of controlled goods.[1] Maintains offices
throughout the country. |
|
State Committee for the Protection of State Borders |
Monitors the movement of goods and people across Ukrainian
borders. Administers all designated border checkpoints.[1] |
| State
Customs Committee |
Examines export declarations at
designated points of exit for goods. Exporters are required to present customs
officials with a customs declaration and documents certifying that the
exporter has permission to export the items in question and that the particular
shipment has an approved export license.[1] |
|
State Service for Export Control
(Derzheksportkontrol) |
Evaluates applications and issues
export licenses.[1] |
|
Ukrspetseksport |
A state-owned exporter and importer of arms, ammunition,
and military
services.[3] |
Export Control
Legislation
Ukraine's export control system is based on the laws of Ukraine and on a series of decrees issued by
the president and the Cabinet of Ministers. (See the
Ukraine: Export Control Legislation file for more
information.) The
State Service for Export
Control is responsible for drafting new export control legislation.[1] A draft
version of a comprehensive export control law, On Export Controls in Ukraine,
has been under discussion since 1998 and will not likely be passed by the
Verkhovna Rada until after the March 2002 elections.[2] Major
export control decrees and laws in force as of November 2001 are
as follows:
Lists of controlled items are
developed by the State Service for Export
Control in coordination with ministries
and government agencies and are adopted by the Cabinet of Ministers.[3]
Ukraine uses the following five control lists:
-
list of nuclear related items as
outlined in Cabinet of Ministers Decrees No.
302 and No. 196;
-
list of items that can be used to develop
chemical, bacteriological and toxic weapons as contained in Cabinet of
Ministers Decree No. 384;
-
list of missile technology products,
equipment, materials and technologies used for the creation of missiles as
contained in Cabinet of Ministers Decrees No.
563 and No. 197;
-
list of military goods as outlined in
Cabinet of Ministers Decree No. 1358;
-
list of dual-use goods as outlined in
Cabinet of Ministers Decree No. 1005.[4]
Information on new legislation and
licensing procedures is transmitted by the State
Export Control Service to the mass media and is also published in the
Ukrainian Ministry of Justice's newspaper Uryadoviy kurer.[5] See
Ukraine:
Export Control Legislation for summaries and full-text of past and current export
control legislation.
Licensing
Procedures
Export licenses are issued by the State Service for Export
Control (SSEC) according to
procedures originally outlined in Cabinet of Ministers Decree
No. 767 of 15 July 1997 and instructions
of the SSEC.[1] Ukraine's licensing system uses a multi-layered approach,
with applications moving through up to four layers of decision-making
bodies.
-
SSEC
Internal Commission: The SSEC Internal Commission, comprised of
SSEC department and division heads, reviews routine, straightforward
applications approximately three times each week. Approved
applications and commission protocols are sent to the SSEC chairman for
final approval whereupon a license is issued to the exporter.[2,3,4]
-
SSEC
Interagency Export Council: The SSEC Interagency Export Council
reviews the bulk of the applications submitted to the SSEC, including all
applications to export military and dual-use goods and goods subject to
reporting requirements of the United Nations and international export
control regimes. It meets as needed, at least every two weeks, and may
call on outside experts from government or industry for consultation.
The application is forwarded to the
Committee
for the Policy on Military-Technical Cooperation and Export Control if the SSEC
Interagency Export Council is unable to come to a unanimous decision on a
license application or if the application involves the export of
particular items to particular countries.[2,3,4]
-
Committee
for the Policy on Military-Technical Cooperation and Export Control:
The Committee for the Policy on Military-Technical Cooperation and Export
Control meets as needed, at least monthly, to consider license
applications. The committee may call on outside experts from
government or industry for consultation. Once the committee makes a
decision, it sends instructions in the form of a protocol along with the
application to the State Service for Export
Control (SSEC), which issues the license. The application is
forwarded onward to the President of Ukraine if the
Committee for the Policy on Military-Technical Cooperation and Export
Control is unable to come to a unanimous decision on a license application
or if the application involves the export of particular items to
particular countries.[2,3,4]
-
President:
The president of Ukraine is the highest level in the export licensing
process. Presidential approval of a license is needed in rare cases
only. The president's decision is forwarded to the
State Service for Export
Control (SSEC) for
implementation.[3,4]
The duration of the licensing process depends on the type and quantity of items to be exported, but may
last up to 60 days.[1] Typical export license applications are issued
within five to 10 days, assuming the exporter has provided all necessary
documentation.[5] The State Service for Export Control
reviews hundreds of license applications each month.[6] See the table
below for total numbers of licenses granted.
Export License Granted, Ukraine[7]
| 1998 |
1999 |
2000 (first six months) |
| 1,078 |
1,311 |
770 |
Ukraine does not maintain a list of
countries of concern to which Ukrainian companies are prohibited from exporting. It does impose full or partial embargoes of exports
to countries as designated by international bodies, such as the UN Security
Council. Ukraine's export control bodies use lists of denied parties when
considering export license applications.[7]
Ukraine issues two types of licenses:
a one-time license and a general license. One-time licenses are issued for
the export of dual-use, nuclear, and chemical goods.[3,4] General licenses
allow for the export of a specific category of goods to one or several countries
without specifying the volume of goods exported. General licenses are
usually issued for transactions with CIS countries with which Ukraine has
signed military cooperation agreements.[2] For the export of weapons, two
licenses are issued. A general license is issued to allow the Ukrainian
arms exporter to conclude a contract with a foreign buyer. A one-time
license is issued for the actual transfer of the arms.[3,4]
Licensing Nuclear
Items
For nuclear or dual-use nuclear exports, the exporter must receive
official approval from the Ministry of Environmental Protection and Nuclear
Safety (MEPNS) before it may submit a license application to the State Service
for Export Control. The MEPNS uses the following guidelines when making a decision as to whether to issue an approval:
-
the importing country is required to guarantee that the commodity will only be used for peaceful purposes;
-
the commodity must be placed under IAEA safeguards;
-
physical protection must be provided at levels not less than those recommended by the
IAEA.
-
re-export of the commodity is forbidden without written permission from the Ukrainian exporter and the export control authorities of Ukraine.
The exporter must submit the following documents to the State Service for
Export Control together with the license application for nuclear or nuclear dual-use exports:
- a copy of the contract;
- an end-user certificate;
- an international import certificate from the country importing the nuclear goods;
- the approval issued by the MEPNS certifying that the exporter has met all the requirements for nuclear exports;
- an approval issued by Ukrainian epidemiological and sanitary authorities certifying that the exporter has met the sanitary requirements for nuclear export;
- a verified copy of the license issued to the facility where the nuclear goods were produced, stored, etc. granting permission for said activities;
- technical specifications, if required.
The contract, end-user certificate, and international import certificate must all indicate the following:
- the end-user of the goods;
- the destination and purpose of the goods;
- a guarantee from the importer that the indicated goods (or their copies) will in no way be used for any activity related to the manufacturing of nuclear explosive devices or in a component of the nuclear fuel cycle not under IAEA safeguards, and that the goods will only be used for declared purposes;
- a guarantee from the importer that the imported goods, their copies, or products made from them will be delivered only to the end-user, and will not be re-exported without written permission from the exporter and the export control authorities of Ukraine.
All ministries and the SSEC take into consideration the political, technical, economic, and military ramifications of any export when making a decision on a particular license application. For example, according to Ukrainian export control regulations, the following factors are among those that are taken into account:
- efforts toward preventing the proliferation of nuclear weapons;
- prospects and purposes of nuclear programs supported by the importing country;
- possibility that the goods could be used to produce nuclear weapons or any type of nuclear explosive device;
- assessment of the end-use of the imported technical means.[1,2]
Enforcement
If an exporter or foreign buyer violates
the conditions governing the export of items indicated in the license, or if
circumstances arise that may be harmful to Ukraine's national security interests
or violate its international obligations, the
State Service for Export
Control (SSEC) may
temporarily suspend or cancel a license. Decisions by the SSEC to refuse, suspend, or cancel permits are taken in consultation
with the Committee
for the Policy on Military-Technical Cooperation and Export Control. Article Two of the Security Service
Act, 5
April 1992, and Article One of the Act on Operational Investigatory Activity, 18
February 1992, assign law enforcement agencies the tasks of preventing,
identifying, halting, and exposing illicit transfers of controlled goods.
The Criminal Code covers infractions of export control rules. Article
228-6, in particular, states that
illegal export of raw materials, materials, equipment, and technologies
which can be used for the production of missile, nuclear, chemical, or
other types of weapons, military or special hardware can lead to confiscation
of property and from three to eight years in prison.
For additional information on Ukraine's
export control system, please see the following:
Export Control Developments in Ukraine
Export Control Legislation
Review of the Export Control System of Ukraine, May
2002
Update on Ukraine's Export Control System,
April 1998
Report on Ukraine's Export Control System,
January 1997
The Scientific
and Technical Center
Stockholm
International Peace Research Institute
Center
for International Trade and Security
Last updated 1 September 2002
Comments or questions? Contact Kenley Butler at
MIIS CNS: Kenley.Butler@miis.edu
This material is produced independently for NTI
by the Center for Nonproliferation Studies at the
Monterey Institute of International Studies and
does not necessarily reflect the opinions of and has
not been independently verified by NTI or its directors, officers,
employees, agents. Copyright © 2002 by MIIS.
