On March 2, 2022, the Department of Commerce's Bureau of Industry and Security (BIS) issued a Final Rule that has added new license requirements and review policies for Belarus to the Export Administration Regulations (EAR) which now subject Belarus to the same sanctions that were imposed on Russia under the EAR effective February 24, 2022. See Update of February 25, 2022. The Department of Commerce indicated that application of these controls on Belarus "will help to prevent the diversion of items, including technology and software, in the defense, aerospace, and maritime sectors to Russia through Belarus, and degrade both nations' ability to sustain military aggression." In summary, these sanctions include:
- Commerce Control List
Requirements – The final rule adds new license
requirements for Belarus. These license requirements apply to
export, reexport or transfer (in-country) to or within Belarus of
any item subject to the EAR and specified in an Export Control
Classification Number (ECCN) in Categories 3-9 of the CCL,
excluding deemed exports and deemed reexports. This includes items,
equipment, software and technology for microelectronics,
telecommunications, sensors, navigation, avionics, marine, and
aircraft.
- Foreign Direct Product (FDP)
Rules – The final rule adds two FDP rules
specific to Belarus and Belarusian military end-users. Under the
FDP rules, the U.S asserts jurisdiction over the export, re-export
and in-country transfer of certain foreign-produced items located
outside the United States that are produced using U.S.-origin
technology. The rule also adds Belarus to the Russia military
end-users FDP rule and the applicability of Footnote 3 of the
Entity List for Belarusian military end-users.
- New License Review Policy of
Denial – The final rule adjusts BIS'
licensing review policy for Belarus to a general "policy of
denial." The following types of license applications will be
reviewed on a case-by-case basis to determine whether the
transaction in question would benefit the Belarus government or
defense sector: applications related to safety of flight, maritime
safety, humanitarian needs, government space cooperation, civil
telecommunication infrastructure, government-to-government
activities, items destined to wholly owned U.S. subsidiaries,
foreign subsidiaries of U.S. companies that are joint ventures with
other U.S. companies, or wholly owned subsidiaries and joint
ventures of companies from partner countries identified in Country
Groups A:5 and A:6 in supplement no. 1 to part 740.
- Additional Restrictions on License
Exceptions – The final rule adds significant
restrictions on license exceptions available for exports, reexports
and transfers (in-country) for Russia.
- Expansion of the Scope of Military End-Use and Military
End-User Restrictions – The final rule expands
the scope of military end-use and military end-user restrictions to
Russia to encompass all items subject to EAR except for food or
medicine designated as EAR99. The rule also adds Belarus to the
countries subject to the "military-intelligence end use"
and "military-intelligence end user" (MIEU)
restrictions.
- Entity List Additions – The final rule adds JSC Integral and The Ministry of Defence of the Republic of Belarus (including the Armed Forces of Belarus and all operating units wherever located) to the Entity List.
In addition, this final rule makes revisions to the licensing scope for telecommunications/information security to note that "commodities and software classified under ECCNs 5A992 or 5D992 do not require a license to or within Russia or Belarus for civil end-users that are wholly-owned U.S. subsidiaries, foreign subsidiaries of U.S. companies that are joint ventures with other U.S. companies, joint ventures of U.S. companies with companies headquartered in countries from Country Group A:5 and A:6 [see Supplement No.1 to Part 740 of the EAR], the wholly-owned subsidiaries of companies headquartered in countries from Country Group A:5 and A:6, or joint ventures of companies headquartered in Country Group A:5 and A:6 with other companies headquartered in Country Groups A:5 and A:6."
This Final Rule will become effective on March 8, 2022. BIS, however, has stated that exports of items impacted by this rule that were en route aboard a carrier to a port of export, reexport, or transfer (in-country) on March 26, 2022, pursuant to actual orders for reexport, or transfer (in-country) to or within a foreign destination, may proceed to that destination under any previous eligibility for a License Exception or reexport or transfer (in-country) without a license (NLR).
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.