BIS Takes Action in Response to Public Comments on Libya Regulations

When BIS first issued its interim rule covering newly-unembargoed Libya on April 29, 2004 the agency requested public comments.  The government response to those comments (pdf) and other perceived shortcomings of the Libya regulations are captured in the final rule promulgated March 22.  The new regulation makes a number of adjustments, but its overall impact is not major for most exporters.  Virtually everything listed on the Commerce Control List (CCL) will continue to require a license for export or reexport to Libya, but there are some significant changes.

The major changes:

• Installed base: The regulation recognizes the “installed base” of items illegally exported to Libya before the end of the embargo, declares a “general amnesty” for previously proscribed activities and creates a reporting mechanism for some installed base transactions going forward.  The EAR prohibits ordering, buying, removing, concealing, storing, using, selling, loaning, disposing of, transferring, financing, forwarding, or otherwise servicing, in whole or part, any items that may have been originally illegally exported or reexported to Libya.  For transactions involving installed base items already in Libya, exporters now only need to report (rather than seek a license) the shipment of EAR99 items, items listed on the CCL now eligible for shipment under a license exception, and items controlled only for NS and AT or AT reasons only which are also not on the Wassenaar Arrangement’s Sensitive List (doc) or Very Sensitive List.  All other activities related to installed base items require a license to overcome the prohibition.  Although it might not go as far as some would have hoped, this is a sensible provision that will provide relief to many US exporters.  It is probably the most important provision of this regulation to most exporters.
• Commercial explosive charges (ECCN 1C992): Licensing policy for oil well perforators changed to from a presumption of denial to case-by-case consideration.
• Civil aircraft: License applications will be reviewed on a case-by-case basis rather than under a policy of denial.
• Portable electric power generators and related software and technology (ECCNs 2A994, 2D994, and 2E994): Clarifies that a license is required to export or reexport items controlled under these ECCNs to Libya.  Applications to non-military end-users or for non-military end-uses will be reviewed case-by-case.
• Temporary sojourn of vessels: License Exception AVS revised to permit the temporary export of vessels departing US waters and the reexport of vessels subject to the EAR on temporary sojourn to Libya.  ECCN 8A992.f is also clarified by explicitly adding the word “vessels”.
• License Exception TMP: Clarifies that software controlled under ECCN 5D992 is eligible to be exported to any destination normally eligible under TMP.
• Commerce Country Chart: BIS mistakenly left off an “X” in the NP:2 column for Libya and has now corrected their error.

Commerce was not convinced by all of the proposals made by those contributing public comments.  BIS declined to eliminate anti-terrorism controls on Libya or liberalize the licensing policy for software classified 5D002 from one of general denial.