What are the US Revised Export Controls with Russia, Belarus, and Iran?
Analyzing the Details of the US Government's Revised Export Controls Law on Trade with Russia, Belarus, and Iran
A new rule, dated January 23, 2024, has been published by the US Department of Commerce's Bureau of Industry and Security (BIS). It accomplishes the following: (i) expand the scope of the Export Administration Regulations (EAR)-based Russian and Belarusian Industry Sector Sanctions; (ii) update the prohibitions intended to prevent Iran from supplying drones, or unmanned aerial vehicles, to Russia; (iii) increase the list of items for which there is no de minimis level of certain US-origin items incorporated into non-US made items when destined for Russia or Belarus; and (iv) make various adjustments and clarifications to the export controls currently in place on Russia and Belarus.
All things considered, these changes strengthen previous rules and more closely align the EAR with the legal frameworks of the United Kingdom, the European Union, and other partners. Additionally, they provide internal coherence within the EAR about legislation concerning Belarus and Russia.
Sanctions on the growing industries of Belarus and Russia
The new rule adds 94 more Harmonised Tariff Schedule ("HTS")-6 codes to the list of items subject to the industrial sector restrictions against Belarus and Russia, as stated in § 746.5(a)(1)(ii) of the EAR and Supplement No. 4 to Part 746. These laws impose licencing requirements on specific EAR99 items bound for Russia or Belarus but would not ordinarily need a licence for export, reexport, or in-country transfer to civilian end users there, in an attempt to weaken Belarusian and Russian industrial capacity.
Interestingly, BIS has included the following categories for items:
every HTS-6 code under HTS chapter 88 (spacecraft, aircraft, and related components); specific petroleum products (like petroleum jelly) and mineral fuels (like coal) under HTS Chapter 27; numerous additional materials (like chemical elements like arsenic, chlorine, hydrogen, nitrogen, and sodium) covered under HTS chapter 28;
Certain kinds of vulcanised rubber are covered by HTS chapter 40; particular industrial textile articles are covered by HTS chapter 59; gallium and other base metals are covered by HTS chapter 81; and specified tools are covered by HTS chapter 82.
Revised rules concerning items connected to UAVs
In an extra effort to prevent Iran, Russia, and Belarus from getting components used in UAVs, BIS added HTS-6 code 852910 (antennas and antenna reflectors and parts thereof) to the list of items that require a permit for export or reexport to Iran under EAR 746.7 and to Russia and Belarus under 746.8. You may read our blog posts here and here about the February 2023 regulation that established these limitations and the May 2023 rule that modified them.
Adjustments to the de minimis examination
The new regulation also expands the scope of the de minimis rule by mandating that non-US-made goods, such as the lowest level military and spacecraft-related items of US origin (i.e., products from the "600 series" or 9×515), be automatically subject to the EAR when they are sent to Belarus or Russia. Previous versions of the de minimis criterion only applied to trips to North Korea, China, Cuba, Iran, and Syria.
Several elucidations and modifications to the export limitations concerning Belarus and Russia
BIS also adopted other clarifications and amendments to increase the internal coherence of different EAR prohibitions on exports, reexports, and in-country transfers to or within Belarus and Russia. The following are a few of the more important ones:
exclusion from licence requirements for military activities by the Ukrainian Armed Forces in Crimea and other regions under its control. Which provision applies to objects classified in an ECCN designated in supplements no. 2, 4, or 5 to Part 746? clarification that when a non-US-made item is going to be exported from a nation included in Supplement No. 3 to Part 746, the US-origin content restricted under Section 746.10 (the "luxury goods" regulations) is not included in the de minimis computation;
The EAR Part 746 Licence Exceptions about Russia and Belarus should be harmonised. Additionally, the exclusion of Supplement No. 6 controls from products that meet the EAR's definition of "medicine" should be clarified. Finally, applications of flight safety should be reviewed on a case-by-case basis.
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