WMD Nonproliferation: The Hidden ‘Polar Star’ of U.S. Export Control Reform?

Introduction

In a June 2010 speech detailing the Obama Administration’s plan to reform U.S. export controls, then-National Security Advisor General James Jones asserted, “The [U.S. export control] system poses a potential national security risk based on the fact that its structure is overly complicated, contains too many redundancies, and tries to protect too much.” [1][2] Termed the President’s Export Control Reform Initiative, this effort – ongoing since April 2010 – aims to modernize, streamline and better target U.S. export controls. [3]

The initiative’s potential impact on WMD nonproliferation efforts is significant. The United States implements its commitments to export control regimes such as the Nuclear Suppliers Group, the Australia Group, the Missile Technology Control Regime, and the Wassenaar Arrangement through updates to its federal export control regulations. [4] Now over a year old, the White House’s export control reform efforts have moved from the conceptual stage to implementation. Executive Orders and updates to the Federal Register aim to reorganize lists of controlled technologies and synchronize enforcement operations. Ultimately, the Administration hopes to realize a single control list, a single export licensing agency, a single enforcement coordination agency, and a single IT system for managing licenses. These more ambitious “Four Singles” however will require Congressional action – an uncertain prospect at best. [5] Accordingly, the timing is ideal to examine the progress of U.S. export control reform and its implications for WMD nonproliferation.

The Strategy of Export Control Reform

Key Obama Administration speeches and statements have not featured WMD nonproliferation as the central purpose of export control reform. Rather, the relationship between U.S. industrial competiveness and national security emerges as the core theme. “The future of the United States’ national security in the 21st century is our competitiveness,” stated General Jones. [6] Specifically, the Obama Administration has argued that a globally competitive U.S. high technology sector is critical to maintaining a robust defense industrial base. The U.S. export control system, with a Cold War-era structure, hinders competitiveness with its complexity, impeding technical collaboration with key allies. Accordingly, reform is needed to strengthen U.S. competitiveness, particularly in sectors most relevant to a healthy defense industry. The President’s State of the Union Address in January 2010, the U.S. 2010 National Security Strategy, and landmark speeches by then-Defense Secretary Robert Gates and General Jones launching the reform initiative all featured this theme. [7]

Yet WMD nonproliferation is not entirely neglected in current export control reform efforts. Indeed, Administration officials have depicted terrorist acquisition of WMD as the type of 21st century threat export controls should strive to address. [8] However, the Administration’s core strategic theme of strengthening U.S. industrial competitiveness appears intended to influence a heated debate over exactly what should be prioritized within the U.S. export control system: the fostering of U.S. industrial competitiveness (via international trade growth and technical collaboration) or containment of potential adversaries (namely China). The debate is sharp enough to stall any reform elements requiring legislation, and the degree to which future export controls address China generates particular controversy. [9] As a consequence of this debate, the goal of WMD nonproliferation appears obscured within the Administration’s strategic pronouncements on export control reform. The details of actual reform measures, however, tell quite a different story.

WMD: The Devil in the Details

Since General Jones’ June 2010 speech, the Obama Administration has forged ahead with implementing any export control reform measures that do not require Congressional approval. Reflecting the Administration’s stated strategy for reform, new and proposed rules reveal the early outlines of a streamlined system. Clarifying and consolidating lists of controlled items (“control lists”) and restricted end-users emerge as key near-term changes. The Administration’s stated goal is to simplify export controls, enabling U.S. industry to comply more efficiently with regulations, improve responsiveness to international customers, and thus become more competitive globally.

Closer examination of the measures, however, reveals that reform is also structured to bolster nonproliferation efforts – an indication perhaps of multiple (and not necessarily competing) strategic priorities at work.

Control Lists

Over the long-term, the Obama Administration’s reform initiative envisions a merger of the two major lists of export-controlled items in U.S. regulations. [10] One list, the Commerce Control List, controls dual-use goods and technologies with both commercial and potential military applications. These include items such as pressure transducers, which are used in the semiconductor industry but are also essential to the construction of uranium enrichment facilities. The other list, the Munitions List, controls goods specially designed for military applications. The Trident II SLBM, exported under U.S. government authorization to the United Kingdom, is one example. Because the lists are administered by separate agencies, and are structured quite differently, industry has complained of “jurisdictional confusion” over which list applies to certain strategic commodities such as carbon composites. [11]

A full merger of the two lists is highly unlikely in the near term. This would require legislation, which poses a difficult hurdle because some in Congress fear that potential adversaries will exploit streamlined controls to acquire sensitive U.S.-origin technologies. However, proposed regulations, introduced in December 2010 for public comment, outlined an early roadmap for aligning the two lists, organizing them into identical “tiers” of control. Although subsequent proposals postponed this "tiering" to accelerate more technical, near-term list revisions, publicizing the concept revealed certain control priorities. Specifically, goods on the Commerce Control List and the U.S. Munitions List would be categorized into Tiers One, Two and Three, depending on the sensitivity of the technologies involved. Similar export restrictions would then apply to both goods in “Tier One” of the Commerce Control List and goods in “Tier One” of the U.S. Munitions List, and so on, through Tiers Two and Three. [12]

On the surface, this "tiering" concept might appear to be a mundane exercise in categorization of goods. For the Administration, however, introducing a proposed alignment represented a concrete first step toward realizing a rational, easy-to-understand export control system. The new Tiers offered a possible framework for clarity and consistency across the two lists, potentially resolving future “jurisdictional confusion.” In theory, at least, U.S. industry would benefit by better anticipating likely export licensing requirements, and not having transactions held up until questions surrounding “which list applies” were resolved.

For nonproliferation practitioners the proposed "tiering" concept is significant, because the potential WMD-related application of the good or technology emerged as a dominant criterion to guide placement of items into the tiers. As proposed, the highest level of control, Tier One, included any item that is:

(a) A weapon of mass destruction;
(b) ;A WMD-capable unmanned delivery system;
(c) A plant, facility, or item specially designed for producing, processing, or using (i) WMDs; (ii) special nuclear materials; or (iii) WMD-capable unmanned delivery systems; or
(d) An item almost exclusively available from the United States that provides a critical military or intelligence advantage. [13]

Similarly, Tier Two appeared reserved for sensitive but widely-used items such as pressure transducers, capturing items only available from U.S. allies and adherents to the major WMD nonproliferation export control regimes. Echoing this, Administration officials repeatedly stress that reform efforts will not dilute U.S. commitments to the NSG, AG, MTCR or Wassenaar Arrangement. [14]

While perhaps obvious from a national security perspective, by simply proposing a WMD-focused ”tiering” of the two major control lists, the Administration communicated a key message to exporters: regardless of whether you are exporting a commercial or military item, WMD nonproliferation is a core objective of U.S. export controls, and trade must not undermine this goal. [15]

A “Migration” Toward the Ultimate End-User

Further reform efforts reinforce the message to exporters of WMD nonproliferation as a central priority. Beyond aligning the control lists, interagency task forces and new regulations are paving the way for “migrating” obsolete or militarily-insignificant items from the Munitions List to the Commerce Control List, or off of the control lists altogether. [16] The end result will be up-to-date, streamlined lists, consistent with the Administration’s stated vision of “a system where higher walls are placed around fewer, more critical items.” [17] In a trial run of this migration, a team of specialists from multiple agencies reviewed Category VII of the Munitions List, Tanks and Military Vehicles, and determined that 74 percent of the items “could be either moved to the CCL or decontrolled.” [18]

This statistic has alarmed some observers, who worry that this effort will lead to inadvertent removal of militarily-significant technologies from the control lists. [19] However, for the U.S vehicle parts manufacturer, any delisting of brake pads or pivot blocks does not open the door to unrestricted exporting. [20] With the introduction of “targeted” sanctions in the 1990s, U.S. regulations have incorporated controls that severely restrict transactions involving WMD-related end-uses and end-users—even if the item being exported is not on any of the control lists. [21] In particular, U.S. exporters are expected to screen all of their transactions against restricted entity lists, many of which are nonproliferation-related or reflect recent UNSC resolutions that sanction specific end-users, such as the Islamic Republic of Iran Shipping Lines (IRISL). [22]

The risk of a U.S. vehicle parts manufacturer receiving an inquiry from one of these end-users is not entirely remote. North Korean entities linked to the DPRK’s missile programs, in particular, have shown interest in acquiring industrial vehicles with dual-use applications such as tanker trucks and power shovels. [23] As streamlining-focused reviews of the Munitions list continued, the Administration introduced in December 2010 a measure designed to help exporters better manage this risk. Prior to the reform initiative, if a U.S. vehicle parts manufacturer had received an ostensibly commercial (not military-related) purchase request from an entity such as the Beijing Power Machinery Institute – sanctioned as of this writing by the U.S. government due to missile proliferation concerns – the company faced the requirement of first screening the potential customer against a myriad of restricted entity lists maintained by various U.S. government agencies. [24] Unless the company deployed sophisticated (and costly) screening software, this necessitated visiting several individual agency websites to access these lists, each with its own unique format. Overlooking the particular list containing the Beijing Power Machinery Institute was a genuine possibility. Now an exporter can go to a single website (export.gov) and access a single list – called the “Consolidated Screening List” – to check whether the involvement of potential customers, forwarders or end-users triggers a license requirement (due to a restricted entity being among the parties to the transaction), even if the export involves an uncontrolled item. [25]

Even with the availability of the consolidated list, larger exporters continue to use sophisticated screening software offered either by niche vendors or firms such as Oracle and SAP. [26] But while its practical impact may be limited, the Administration’s launch of the Consolidated Screening List communicates another message to exporters: although items are likely to be decontrolled as part of the reforms, industry remains responsible for screening the end-users of transactions involving all items. As many of the entities on the Consolidated Screening List are WMD-related, the relationship of this reform to nonproliferation objectives should not be underestimated.

Enforcement

The Administration’s initial reforms accelerate a shift in export control emphasis that has been developing since the early 2000s. Traditional control list-based export restrictions, focused on the technology level of goods, are yielding to transaction-based controls, which focus on the end-user. Yet how will authorities enforce these newly introduced controls?

Based on current regulations, potential priorities for export enforcement, in theory, can range anywhere from countering WMD proliferation, to limiting China’s military modernization, to addressing human rights abuses in Myanmar or Syria, or to weakening the Arab League’s boycott of Israel. [27] More recently, however, clues have emerged suggesting a tilt in enforcement emphasis toward countering WMD proliferation.

In May 2010, then-acting director of the Bureau of Industry and Security’s Office of Export Enforcement John Sonderman described heightened efforts to inhibit Iran’s attempts to acquire civilian aircraft. [28] While these efforts do not involve a WMD-related commodity, the emphasis on a country of proliferation concern during a transitional period for U.S. export controls is significant. Nearly a year later, BIS Assistant Secretary for Export Enforcement David Mills indicated in an April 2011 speech for the American Bar Association that Iran and countering WMD proliferation are key priorities for enforcement. [29] In reporting on David Mills’ speech, a leading compliance blog placed Mills’ remarks in the context of the National Counter-Proliferation Initiative (NCPI), an effort launched in 2007 by the U.S. Department of Justice to “increase the detection and prosecution of export control violations.” [30] As described in the original press release announcing the NCPI, the “technology at the heart of this initiative includes restricted U.S. military items, dual-use equipment, and other technical expertise or know-how, some of which have applications in Weapons of Mass Destruction.” [31]

In parallel with this tilt in strategy, on November 9, 2010, President Obama issued Executive Order no. 13358, establishing a Federal Export Enforcement Coordination Center within the Department of Homeland Security. [32] The current U.S. export control system distributes export enforcement responsibility across several agencies encompassing multiple departments. These include the BIS Office of Export Enforcement, the Defense Criminal Investigative Service, Immigration and Customs Enforcement (ICE), and the FBI. Confusion surrounding which agency has jurisdiction over a case is not unknown. [33] The new export enforcement “fusion center” will include full-time staff, comprised partly of seconded officials from these various agencies. [34] According to the text of the Executive Order and comments from Administration officials, the center aims to improve information sharing, reduce redundancies in investigating export violations, and enable deeper involvement of enforcement specialists in the examination of export licenses prior to their issuance. [35]

Ultimately, the operational changes and tilt in strategy demonstrate White House-level attention to export enforcement – a powerful complement to regulatory reforms already strengthening the nonproliferation dimension of U.S. export controls.

Conclusion

Acting in concert, the reform measures described in this brief appear strategically structured to prioritize those controls most relevant to WMD nonproliferation. At the industry level in particular, companies will take note of the increased regulatory and enforcement emphasis on end-user screening. WMD nonproliferation awareness stands to benefit tremendously as private companies and multinational corporations, having already implemented end-user screening and detection of suspicious inquiries as “best practices” elements in their compliance programs, are likely to increase training even further in this direction. [36] Comprising the core of this training would be awareness of illicit WMD procurement networks and WMD proliferation in general. The concern centers less on what is being bought than on who is buying it.

Yet in its senior-level pronouncements, the Obama Administration has chosen to emphasize a different dimension of the reforms—gains in efficiency yielding, hopefully, equivalent gains in U.S. competitiveness. All of the regulatory and operational changes described certainly possess an “efficiency” theme, and U.S. industry may indeed benefit. However, critics of export control reform caution against streamlining in the name of efficiency and competitiveness, fearful of opening strategic technologies to acquisition by harmful actors, and especially future competitors to U.S. military supremacy. Thus the debate over fostering competitiveness versus containing potential adversaries is perpetuated, especially in Congress. Industry practitioners and those close to government question whether reforms requiring legislation—a single control list, a single licensing agency, a single IT system to manage the licenses, and a single enforcement center (the “Four Singles”)—can ever be realized. [37]

This raises the question of how the debate might be shaped if countering WMD proliferators, as a collective adversary, became the “central organizing principle” of U.S. export control reform. By focusing on a specific threat to national security, the case for reform might be simpler to make than a lengthy cause-and-effect argument describing how U.S. competitiveness drives innovation, which in turn helps maintain the American defense industrial base, the health of which reinforces U.S. national security.

In a WMD nonproliferation policy context, such an “adversary-focused” approach to justifying export control reform warrants consideration. Even if the “Four Singles” remain elusive, the mere act of introducing into a heated reform debate the concept of WMD nonproliferation as a navigational guide for U.S. export control reform could significantly boost public and industry awareness of the issue. As demonstrated by the reforms being implemented, WMD nonproliferation may already be the “polar star” for those traversing this new regulatory landscape: the exporters themselves.

Sources:
[1] The author thanks Dan Fisher-Owens, Stephanie Lieggi, Gary Smith, and Jessica Varnum for their comments on drafts of this issue brief.
[2] “’The Administration’s Export Control Reform Plans, Remarks by General James Jones, National Security Advisor, June 30, 2010, “Export Control Reform Speeches and Fact Sheets, www.export.gov
[3] “Fact Sheet on the President’s Export Control Reform Initiative,” The White House, Office of the Press Secretary, April 20, 2010, www.whitehouse.gov.
[4] Most notable among these are the Export Administration Regulations and the International Traffic in Arms Regulations.
[5] “Fact Sheet on the President’s Export Control Reform Initiative,” The White House, Office of the Press Secretary, April 20, 2010, www.whitehouse.gov.
[6] “’The Administration’s Export Control Reform Plans, Remarks by General James Jones, National Security Advisor, June 30, 2010, “Export Control Reform Speeches and Fact Sheets, www.export.gov
[7] “National Security Strategy, May 2010,” The White House, www.whitehouse.gov; “Remarks by the President in the State of the Union Address.” The White House Office of the Press Secretary, January 27, 2010, www.whitehouse.gov; “Speech: Business Executives for National Security (Export Control Reform) Remarks as Delivered by Secretary of Defense Robert M. Gates, Ronald Reagan Building and International Trade Center, Washington DC, Tuesday, April 20, 2010,” U.S. Department of Defense, www.defense.gov; “’The Administration’s Export Control Reform Plans, Remarks by General James Jones, National Security Advisor, June 30, 2010, “Export Control Reform Speeches and Fact Sheets, www.export.gov
[8] In his April 20 speech introducing the Export Control Reform Initiative, then-Secretary Gates stated: “As a result, its rules, organizations, and processes are not set up to deal effectively with those situations that could do us the most harm in the 21st century – a terrorist group obtaining a critical component for a weapon of mass destruction, or a rogue state seeking advanced ballistic-missile parts.” See: Business Executives for National Security (Export Control Reform) Remarks as Delivered by Secretary of Defense Robert M. Gates, Ronald Reagan Building and International Trade Center, Washington DC, Tuesday, April 20, 2010,” U.S. Department of Defense, www.defense.gov.
[9] See letter dated January 28, 2008 from Rep. Edward J. Markey to then-Commerce Secretary Carlos Gutierrez regarding the BIS’s Validated End-User (VEU) program and concerns regarding the “sale of dual-use American products to Chinese corporations with significant ties to the People’s Liberation Army” in Clif Burns, “Two of Five BIS Validated End Users Linked to Chinese Military,” ExportLawBlog, January 31, 2008, www.exportlawblog.com; see also quoted comments made by Mike Gold of Bigelow Aerospace, noting the export control reform debate and the China-related concerns of Rep. Dana Rohrabacher in Jeff Foust, “A fading opportunity for export control reform?” The Space Review blog, October 11, 2010, www.thespacereview.com
[10] As stated in Phase III of the President’s Export Control Reform Initiative, “the transition to the new U.S. export control system,” will “merge the two [control] lists into a single list, and implement systematic process to keep current.” See “Fact Sheet on the President’s Export Control Reform Initiative,” The White House, Office of the Press Secretary, April 20, 2010, www.whitehouse.gov..
[11] The jurisdictional confusion in particular surrounds the question of the degree to which certain carbon composite materials were originally designed for military applications. If the “original design intent” of an item is military in nature, the Munitions List – found within the International Traffic in Arms Regulations and administered by the U.S. Department of State – will likely apply. For an account of how this issue impacted Boeing’s 787 commercial aircraft program see Dominic Gates, “Separation Anxiety: The Wall between Military and Commercial Technology,” The Seattle Times, January 22, 2006, https://seattletimes.nwsource.com.
[12] The concept of "tiering" the control lists was formally introduced via publication of two proposed rules in the Federal Register: “Commerce Control List: Revisiting Descriptions of Items and Foreign Availability,” (Advance notice of proposed rulemaking) Federal Register, Vol. 75, No. 236 (75 FR 76664), Thursday, December 9, 2010; “Revisions to the United States Munitions List” (Advance notice of proposed rulemaking), Federal Register, Vol. 75, No. 237 (75 FR 76935), December 10, 2010; see also “State Seeks Comments on Revising USML into Three Tiers of Control,” The Export Practitioner, January 2011, Vol. 25, No. 1, www.exportprac.gov. The postponement of the "tiering" concept, as an active proposal, was announced nearly a year later with the publication of a revised proposed rule in the Federal Register: "Amendment to the International Traffic in Arms Regulations: Revision of the U.S. Munitions List Category VII," Federal Register, Vol. 76, No. 24 (76 FR 76100), December 6, 2011; as noted in an industry publication reporting on the postponement, "the administration intends to revisit the issue at a later time." (quote from "Effort to 'Tier' Export Control Lists Postponed to Avoid Problems for Exporters," WorldTradeINTERACTIVE, Sandler, Travis & Rosenberg, P.A., Vol. 18, Issue 243, December 7, 2011, www.strtrade.com); this is supported by language such as "not yet tiered" that appears in 76 FR 76100.
[13] “Commerce Control List: Revisiting Descriptions of Items and Foreign Availability,” (Advance notice of proposed rulemaking) Federal Register, Vol. 75, No. 236 (75 FR 76664), Thursday, December 9, 2010; “Revisions to the United States Munitions List” (Advance notice of proposed rulemaking), Federal Register, Vol. 75, No. 237 (75 FR 76935), December 10, 2010; “State Seeks Comments on Revising USML into Three Tiers of Control,” The Export Practitioner, January 2011, Vol. 25, No. 1, www.exportprac.gov
[14] “Speech: Business Executives for National Security (Export Control Reform) Remarks as Delivered by Secretary of Defense Robert M. Gates, Ronald Reagan Building and International Trade Center, Washington DC, Tuesday, April 20, 2010,” U.S. Department of Defense, www.defense.gov; “Remarks of Commerce Assistant Secretary Kevin Wolf to SMi Group Conference on Defense Trade, Brussels Belgium,” Bureau of Industry and Security, U.S. Department of Commerce, October 4, 2010, www.bis.doc.gov as reprinted in Northrop Grumman Law Department Export/Import Daily Update, October 13, 2010 via e-mail subscription; “Testimony, Ellen Tauscher, Under Secretary for Arms Control and International Security, Statement before the House Foreign Affairs Committee, Washington, D.C., May 12, 2011,” U.S. Department of State, Export Control Reform, www.state.gov.
[15] In addition to WMD-related items, the degree to which a good and/or technology provides a “significant military advantage” was also a key criterion in the "tiering" concept. See definition of Tier One in “Commerce Control List: Revisiting Descriptions of Items and Foreign Availability,” (Advance notice of proposed rulemaking) Federal Register, Vol. 75, No. 236 (75 FR 76664), Thursday, December 9, 2010; “Revisions to the United States Munitions List” (Advance notice of proposed rulemaking), Federal Register, Vol. 75, No. 237 (75 FR 76935), December 10, 2010.
[16] The June 2011 introduction of new License Exception Strategic Trade Authorization (STA) in the Export Administration Regulations appears to be a component in the planned “migration” process, Although now available for use and thus technically independent of the “migration” of items from the USML to the CCL, the new License Exception features prominently in a proposed rule released by the Obama Administration on July 15, 2011 that outlines a detailed architecture for how items transferred from the USML will be incorporated into the CCL. See “Proposed Revisions to the Export Administration Regulations (EAR); Control of Items the President No Longer Warrant Control Under the United States Munitions List.” Federal Register, Vol. 76, No. 136 (76 FR 41958), Friday July 15, 2011 , Proposed Rules (via www.bis.doc/news/2011); While still in a “proposed rule” state, the eventual migration process may be slowed by the requirement for Congressional notification of any items transferred off the USML by the Administration, especially as this can invite debate over this dimension of reform.
[17] In his April 20 speech introducing the Export Control Reform Initiative, then-Secretary Gates stated “For these reasons and more, in August of last year, the president directed a broad-based review of the U.S. export-control regime. He has called for reforms that focus controls on key technologies and items that pose the greatest national-security threat. These include items and technologies related to global terrorism, the proliferation and delivery systems of weapons of mass destruction, and advanced conventional weapons. In short, a system where higher walls are placed around fewer, more critical items.” See “Speech: Business Executives for National Security (Export Control Reform) Remarks as Delivered by Secretary of Defense Robert M. Gates, Ronald Reagan Building and International Trade Center, Washington DC, Tuesday, April 20, 2010,” U.S. Department of Defense, www.defense.gov. The “higher walls” concept has been referenced in numerous speeches and commentaries on export control reform. As an example, the landmark policy study advocating reform of U.S. export controls, Beyond Fortress America, states in its “Findings” section that “The United States should not abandon its high walls around the technologies that can deliver a substantial and sustainable security advantage.” See Beyond Fortress America (Washington D.C.: National Academies Press, 2009), p. 56.
[18] “First USML Review under Export Reforms Proposes Moving Many Items to CCL,” The Export Practitioner, September 2010, Vol. 24, No. 9, www.exportprac.gov
[19] Jeff Abramson, “Export Control Reform: Grading the Obama Administration’s Conventional Arms Control Record,” ArmsControlNOW, The Blog of the Arms Control Association, February 9, 2011, https://armscontrolnow.org; Abramson’s blog entry includes a link to another critical analysis of the President’s Export Control Reform Initiative, in form of comments by William J. Lowell, Managing Director of Lowell Defense Trade, LLC, in response to the two Advanced Notices of Proposed Rulemaking related to the CCL and Munitions List respectively and published in the Federal Register. The comments can be found at this link (via Abramson’s blog entry): www.armscontrol.org.
[20] Certain types of brake pads and pivot blocks have been cited by the Obama Administration as examples of Munitions List items that ideally should not be controlled under the ITAR, as nearly identical items for fire trucks are treated as purely dual-use items, subject only to the Export Administration Regulations and with a technology-level not sufficient to trigger export licensing requirements to most destinations. See “President Obama Lays the Foundation for a New Export Control System to Strengthen National Security and the Competitiveness of Key U.S. Manufacturing and Technology Sectors,” The White House, Office of the Press Secretary, August 30, 2010, www.whitehouse.gov; “Secretary Gary Locke, Remarks to BIS Update Conference, Tuesday, August 31, 2010,” Bureau of Industry and Security, Department of Commerce, www.bis.doc.gov.
[21] See Part 744 “Control Policy: End-Use and End-User Based” of the U.S. Export Administration Regulations, and in particular Parts 744.2 through 744.4 which comprise “catch-all” regulations, imposing licensing requirements for exports intended to support nuclear, chemical, biological and missile WMD-related end-uses.
[22] See Part 744 (Control Policy: End-User and End-Use Based) of the U.S. Export Administration Regulations, in particular Part 744.1 (General provisions) and Part 744.8 (Restrictions on exports and re-exports to persons designated pursuant to Executive Order 13382 – Blocking Property of Weapons of Mass Destruction Proliferators and Their Supporters); “Major Iranian Shipping Company Designated for Proliferation Activity,” U.S. Department of Treasury Press Center, September 10, 2008, www.treasury.gov; “United Nations Security Council Resolution 1929,” UN Security Council Resolutions 2010, S/RES/1929 (2010), June 9, 2010, www.un.org (see in particular paragraphs 19, 20 and 22, and Annex III (Entities owned, controlled, or acting on behalf of the Islamic Republic of Iran Shipping Lines (IRISL)).
[23] Stephanie Lieggi, Robert Shaw, and Masako Toki, “Taking Control: Stopping North Korean WMD-related Procurement,” Bulletin of the Atomic Scientists, September/October 2010 , 66(5): 21-34; “Kumamoto Trading Firm Head Indicted over Illegal Exports to China,” Kyodo News Service via Japan Economic Newswire, July 13, 2010 (accessed via LexisNexis at www.lexisnexis.com); “Two Arrested in Japan for Alleged Illegal Exports to North Korea,” Kyodo News Services via BBC Monitoring Asia-Pacific, June 22, 2010 (accessed via LexisNexis at www.lexisnexis.com)
[24] In 2001, the Beijing Power Machinery Institute was placed on the Entity List, administered by the U.S. Department of Commerce’s Bureau of Industry and Security and is still listed as of this writing (see “The Entity List,” U.S. Department of Commerce, Bureau of Industry and Security, www.bis.doc.gov (accessed November 19, 2011). Exports to end-users included on the Entity List may have additional export licensing requirements, even if the export normally would not require an export license due to the technology level and/or destination country. In the case of the Beijing Power Machinery Institute, this entity was included on the Entity List due to missile proliferation concerns (see “The U.S. Entity List – Annotated China Section,” Wisconsin Project on Nuclear Arms Control, www.wisconsinproject.org (accessed November 19, 2011)) ; the range of lists that an exporter (subject to U.S. export control regulations) needs to check can be found at “Lists to Check,” U.S. Department of Commerce, Bureau of Industry and Security, www.bis.doc.gov (accessed November 19, 2011)
[25] Introduced on December 9, 2010, this list can be found on the export.gov website. See “Consolidated Screening List”, export.gov, Export Control Reform, www.export.gov (accessed November 19, 2011); as of this writing, this list includes the entire Entity List and thus “Beijing Power Machinery Institute”
[26] The author had direct experience with implementation and use of such software while working as an internal export compliance specialist for a U.S. subsidiary division of a multinational electronics manufacturer. See also “Oracle Launches Oracle Global Trade Management,” Oracle Press Release, January 11, 2010, www.oracle.com; and SAP’s Global Trade Services, www.sap.com.
[27] Efforts to support the latter can be found in Part 760 (Restrictive Trade Practices and Boycotts) of the U.S. Export Administration Regulations; see also “Antiboycott Compliance,” U.S. Department of Commerce, Bureau of Industry and Security, www.bis.doc.gov.
[28] “BIS Puttlng Focus on Iran’s Expected Increase in Aircraft Acquisitions,” The Export Practitioner, May 2010, Vol. 24, No. 5, www.exportprac.com
[29] Peter Quinter, “New Export Enforcement Priorities Come with New Names at the Bureau of Industry and Security,” Customs and International Trade Law blog, April 17, 2011, www.customsandinternationaltradelaw.com
[30] Peter Quinter, “New Export Enforcement Priorities Come with New Names at the Bureau of Industry and Security,” Customs and International Trade Law blog, April 17, 2011, www.customsandinternationaltradelaw.com.
[31] “Justice Department and Partner Agencies Launch National Counter-Proliferation Initiative,” Press Release, U.S. Department of Justice, October 11, 2007, www.justice.gov.
[32] “Executive Order – Export Coordination Enforcement Center,” The White House, Office of the Press Secretary, November 9, 2010, www.whitehouse.gov.
[33] For a description of this confusion, see Cecil Hunt, “Export Enforcement: Focused or Blurred?” The Export Practitioner, December 2010, Vol. 24, No. 12, www.exportprac.gov
[34] “Executive Order – Export Coordination Enforcement Center,” The White House, Office of the Press Secretary, November 9, 2010, www.whitehouse.gov;“ Update 2011 Conference: Remarks of David W. Mills, Assistant Secretary for Export Enforcement,” U.S. Department of Commerce, Bureau of Industry and Security, July 20, 2011 www.bis.doc.gov; “Statement of John P. Woods, Deputy Director, Homeland Security Investigations, U.S. Immigration and Customs Enforcement, Department of Homeland Security, Regarding a Hearing on ‘Jamming the IED Assembly Line: Impeding the Flow of Ammonium Nitrate in South and Central Asia, before the United States Senate Committee on Foreign Relations, Subcommittee on Near Eastern and South and Central Asian Affairs,” U.S. Immigration and Customs Enforcement, November 18, 2010, https://foreign.senate.gov
[35] “Executive Order – Export Coordination Enforcement Center,” The White House, Office of the Press Secretary, November 9, 2010, www.whitehouse.gov; “Consolidation of Export Enforcement Begins with New Fusion Center,” The Export Practitioner, June 2010, Vol. 24, No. 6., www.exportprac.gov.
[36] The author had direct experience with this while implementing and managing an internal export compliance program for a U.S. subsidiary division of a multinational electronics manufacturer.
[37] Discussions with industry consultants, legal and governmental practitioners and related experts across 2010-2011.