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( $ Figure  1  $TahomaZ[\]^_`xCEIMQUY]aAutoList7!!!!!!!!1)a)http://www.bis.doc.gov/SNAP/index.htm !  _f @ g 8f@XXdd8  &   `     h (#(#K(#@(#(#K(#  pp4(#BillingCode:351033P     `     h   (#(#K(#f  f  g ԈDEPARTMENTOFCOMMERCE L  BureauofIndustryandSecurity $ t 15CFRparts740and774   h     L  DocketNo.041018284428401   RIN:0694AD04   MicroprocessorTechnologyEligibleforExportunderLicenseException 4 AGENCY:BureauofIndustryandSecurity,Commerce. 4      ACTION:FinalRule  SUMMARY:TheBureauofIndustryandSecurity(BIS)isexpandingtheavailabilityofLicense D! ExceptionCIVforcertaindeemedexportsofmicroprocessortechnologyontheCommerce #l! ControlList(CCL)oftheExportAdministrationRegulations(EAR)underExportClassification $D # ControlNumbers(ECCN)3E001and3E002.TheseECCNscontroltechnologythatcanbeused &"% forthedevelopmentandproductionofmicroprocessors.Thisfinalrulepartiallyimplementsa (#' proposedrulepublishedonOctober24,2003.Theproposedruleincludedtheexportand |*%) reexportofgeneralpurposemicroprocessortechnologyunderLicenseExceptionCIV,whilethis d finalrulelimitsLicenseExceptionCIVeligibilitytodeemedexportsforcertainmicroprocessor < technology.BIShasdeterminedthatfurtherliberalizationofcontrolsonexportsof   microprocessortechnologymustawaitagreementintheWassenaarArrangement.Thisrulealso   establishesa ForeignNationalReview(FNR)requirementunderLicenseExceptionCIVfor  ` deemedexportsofmicroprocessortechnologyg tocertaineligibleforeignnationals. 8  DATES:ThisruleiseffectiveonNovember5,2004. L  FORFURTHERINFORMATIONCONTACT:SharronCook,SeniorExportPolicyAnalyst,  OfficeofExporterServices,RegulatoryPolicyDivision,BureauofIndustryandSecurity, p Telephone:(202)4822440. H SUPPLEMENTARYINFORMATION \ Background 4  OnOctober24,2003,BISpublishedaproposedrulewithrequestforcomments(68FR60891) #  fromindustrytoassistBISinevaluatingmicroprocessortechnologycontrolledunderECCN %X" 3E002,aswellascomputertechnologyandsoftwarecontrols.BISreceivedelevencommentsin '0!$ responsetothisrequest.Whiletheproposedrulecoveredbothmicroprocessortechnologyand l)#& computertechnologyandsoftware,BIShasdecidedtoaddresscomputertechnologyand D+$( softwareandmicroprocessortechnologyintwodifferentrules.Thisfinalruleimplementsthe -&* & ,/,   licenseexceptionexpansionformicroprocessortechnology.Thecorrespondingruleonlicense  exceptioneligibilityforcomputertechnologyispublishedelsewhereinthisissueoftheFederal ` Register. 8  f  g CurrentControlsonMicroprocessorTechnology  `   TechnologyforthedevelopmentandproductionofmicroprocessorsthathaveaCTP 8  exceeding530MTOPSandanarithmeticlogicunitwithanaccesswidthof32bitsormoreare   controlledbyECCN3E002,pursuanttoagreementbymembersoftheWassenaarArrangement p  (WA).LicenseExceptionTSRisavailablefortheexportandreexportoftechnologyfor H microprocessorsofunlimitedCTPtoallCountryGroupBcountries(seeSupplementNo.1to   part740oftheEAR),ifallthecriteriaofLicenseExceptionTSRaremet(seesection740.6of p theEARforLicenseExceptionTSRrequirements). H   Inaddition,technologyforthedevelopmentorproductionofmicroprocessorsthathave  morethanonedataorinstructionbusorserialcommunicationportthatprovidesadirectexternal X  interconnectionbetweenparallel microprocessormicrocircuitswithatransferrateexceeding 0" 150MegabytespersecondarecontrolledbyECCN3E001,because microprocessor $  microcircuits, microcomputermicrocircuitsandmicrocontrollermicrocircuitshavingthis %X" characteristicarecontrolledunderECCN3A001.a.3.c.LicenseExceptionTSRisavailablefor '0!$ theexportandreexportoftechnologyformicroprocessorsofunlimitedtransferratetoall )#& CountryGroupBcountries(seeSupplementNo.1topart740oftheEAR),ifallthecriteriaof h+$( LicenseExceptionTSRaremet(seesection740.6oftheEARforLicenseExceptionTSR @-&* requirements).   f  g f  g DeemedExportRevisions 8    WhiletheoriginalFederalRegisternoticeproposedexpandingLicenseException   availabilityforactualexportsandreexportsofmicroprocessortechnology,thisfinalruleexpands  ` LicenseExceptionCIVavailabilityfordeemedexportsonly.Generally,Wassenaarcountriesdo 8  nothaveincountrytransfercontrols(deemedexportcontrols),withtheexceptionofclassified   material. p    MicroprocessortechnologyislistedbytheWassenaarArrangementontheBasicList   (530MTOPS).Accordinglyadjustmentsincontrollimitsforactualexportsandreexportof p microprocessortechnologyshouldbeimplementedbasedonagreementwiththeUnitedStates H Wassenaarpartners.Therefore,theUnitedStatesmaydiscussraisingthelevelofcontrolsfor   actualexportandreexportofmicroprocessortechnologyintheWassenaarArrangement.    TheEARdefines exporttoinclude,amongotherthings,thereleaseoftechnologyor 0" sourcecodesubjecttotheEARtoaforeignnationalwithintheUnitedStates.Suchreleaseis $   deemedtobeanexporttothehomecountryorcountriesoftheforeignnational.Thedeemed %X" exportruledoesnotapplytopersonslawfullyadmittedforpermanentresidenceintheUnited '0!$ StatesanddoesnotapplytopersonswhoareprotectedindividualsundertheImmigrationand )#& NaturalizationAct(8U.S.C.1324b(a)(3)).Deemedexportlicenseapplicationsforforeign h+$( nationalswithdualcitizenshipshouldbebasedonthemostrecentlyobtainedcountrycitizenship. @-&* Applicationsforforeignnationalswithtemporaryorpermanentresidencestatusofathird  country(f  g f  g i.e.f  g f  g ,nonU.S.andatemporaryorpermanentresidencestatusotherthanaforeign ` nationalscountryoforigin)shouldbebasedontheforeignnationalscountryofcitizenship. 8    BecausetheUnitedStatesisoneoftheonlyWAcountrymemberstoimplementdeemed  ` exportcontrols,U.S.industryhasbeenrequiredtoobtainlicenseauthorizationforthesedeemed 8  exportswhenotherWAmembercountrieshavenotimposedsuchcontrolsontheirindustries.   ExpandingtheavailabilityofaLicenseExceptionforgeneralpurposemicroprocessortechnology p  providesrelieffromlicensingburdensforU.S.industryandlevelstheplayingfieldinglobal H competition.BIShasfoundthattheexpansionoflicenseexceptionavailabilityunderthe   technologyparameterssetforthbelowwillnothaveanadverseimpactontheU.S.national p security. H f  g ExpansionofLicenseExceptionCIVforCertainDeemedExportsofMicroprocessor  TechnologyControlledunderECCNs3E001and3E002 X    ThisruleauthorizesunderLicenseExceptionCIVdeemedexportsoftechnology 0" controlledunderECCN3E001forthedevelopmentandproductionofmicroprocessors $  controlledunderECCN3A001.a.3.f  g c.withaCTPlessthanorequalto40,000MTOPS(regardless %X" ofwordlengthoraccesswidth)toCountryGroupD:1nationals.LicenseExceptionCIVdoes '0!$ notapplytoECCN3E001technologyforECCN3A001.a.3.crequiredforthedevelopmentor )#& productionofotheritemscontrolledunderECCNsbeginningwith3A,3B,or3C,ortoECCN h+$( 3E001technologyalsocontrolledunderECCN3E003. @-&* Ї  Inaddition,thisruleauthorizesunderLicenseExceptionCIVdeemedexportsof  technologycontrolledunderECCN3E002forthedevelopmentandproductionof ` microprocessorsg havingf  g ԀaCTPlessthanorequaltof  g Ԁ40,000MTOPS(regardlessofwordlengthor 8  accesswidth)toCountryGroupD:1nationals.LicenseExceptionCIVdoesnotapplytoECCN   3E002technologyalsorequiredforthedevelopmentorproductionofitemscontrolledunder  ` ECCNsbeginningwith3A,3B,or3C,ortoECCN3E002technologyalsocontrolledunder 8  ECCN3E003.   f  g RequirementsforUseofLicenseExceptionCIVforDeemedExportsofEligibleMicroprocessor H Technologyf       LicenseExceptionCIVmaynotbeusedformilitaryendusersortoknownmilitaryuses. H Inadditiontoconventionalmilitaryactivities,militaryusesincludeanyproliferationactivities   describedinpart744oftheEAR.DeemedexportsunderLicenseExceptionCIVarenot  authorizedtoforeignnationalsinanexpiredvisastatus.Itistheresponsibilityoftheexporterto X  ensurethat,inthecaseofdeemedexports,theforeignnationalmaintainsavalidU.S.visa,if 0" requiredtoholdavisafromtheUnitedStates. $     ThisrulemakesLicenseExceptionCIVavailablefordeemedexportsofeligible '0!$ microprocessortechnologytoanyCountryGroupD:1foreignnationalonceaForeignNational )#& Review(FNR)requesthasbeensubmittedtoBISandconfirmationofeligibilityhasbeen h+$( obtainedfromtheSystemforTrackingExportLicenseApplications(STELA)ortheSimplified @-&* NetworkApplicationProcedure(SNAP).FNRrequestsmustbesubmittedusingFormBIS  748P(MultipurposeApplication),oritselectronicequivalent,andmustincludeinformation ` abouttheforeignnationalwhoistoreceivethemicroprocessortechnology.Theinformation 8  requiredfortheFNRrequestissetforthinparagraphs(s)and(t)ofSupplementNo2topart748   oftheEAR.BISwillrefertheFNRrequestforinteragencyreviewwithinninebusinessdaysor,  ` ifnecessary,returntheFNRrequestwithoutactiontotheapplicant,f  g f  g e.g.f  g f  g ,ifmoreinformationis 8  necessary.Theagencieshave30daysinwhichtoreturnarecommendationtoBIS.     ExporterswhohavecurrentlicensesfordeemedexportsofsuchtechnologytoCountry H GroupD:1foreignnationalsthatbecomeeligibleforLicenseExceptionCIVarenolongerbound   byconditionsontheirlicenses,asprovidedundersection750.7oftheEAR.Terminationof p licenseconditionsdoesnotrelieveanexporterofitsresponsibilityforviolationsthatoccurred H priortotheavailabilityoftheLicenseException.       Althoughmostlicensesformicroprocessortechnologyf  g f  g havebeenissuedtocompanies X  whoemployCountryGroupD:1foreignnationalsintheirU.S.facilitiesandwhoholdwork 8" visasissuedbytheU.S.Government,theavailabilityofLicenseExceptionCIVfordeemed $  exportsisnotconfinedtoemployerreleasesoftechnologyf  Ԁg toemployees.Itisalsoavailablefor %`" deemedexportsoftechnologyf  g g ԀtoCountryGroupD:1foreignnationalvisitorsandcustomers, '8!$ providedthattheirbackgroundshavebeencheckedundertheproceduressetforthinLicense )#& ExceptionCIV. p+$(  H-&*   AlthoughtheExportAdministrationActexpiredonAugust20,2001,ExecutiveOrder  13222ofAugust17,2001(3CFR,2001Comp.,p.783(2002)),asextendedbytheNoticeof ` August6,2004,69FR48763(August10,2004)continuestheRegulationsineffectunderthe 8  InternationalEmergencyEconomicPowersAct.     f  g Comments 8  ThecommentsthatwerereceivedbyBISmaybefoundat   http://efoia.bis.doc.gov/pubcomm/Computer%20Tech%20and%20Software/Final.pdf.Setforth p  belowarethequestionsthatwereposedtoindustryintheproposedruleandasummaryofthe H commentsBISreceivedand,whereapplicable,BISsresponsetothosecomments.   f  1.Whatimpactwouldtheproposedrevisionofcomputertechnologyandsoftwarecontrolshave H onyourcompany?f  g f  g    Commentsinresponsetothisquestionareaddressedinthefinalruleforcomputertechnology X  exportcontrols. 0" f  g f  g f  g 2.Isthereanotherproposalregardingcomputertechnologyandsoftware,andmicroprocessor %X" technologycontrolsthatyouwouldlikeCommercetoconsider?Ifso,describeyourproposalin '0!$ detailandpleasegivetechnicalandotherjustificationsforyourproposal.f  g f  g  )#& BISreceivedmanycommentsfromindustrysuggestingthatBISeliminateMTOPScontrolsfor @-&* _microprocessortechnologyandinsteaduseenduserandendusebasedcontrolstoharmonize  withtheexportcontrolsofmicroprocessorchipsimplementedbyBIS. ` Technologyandsoftwareforthedevelopmentandproductionofmicroprocessorchipsislisted   ontheSensitiveList(Annex1)oftheWassenaarArrangement,i.e.,33membercountrieshave  ` agreedthatthistechnologymustnotonlybeontheListofDualuseGoodandTechnologies,but 8  mustbecarefullymonitoredbecauseoftheusefulnessofthistechnologyandsoftwarein   producinganddevelopingconventionalarms.Thecontrollingparametersthathavebeen p  approvedbytheWassenaarmembercountriesareCompositeTheoreticalPerformance(CTP)in H MillionsofOperationsperSecond(MTOPS),compositionmaterial(compoundsemiconductor),   clockfrequencyinMHz,andnumberofdataorinstructionbusorserialcommunicationports p andrelateddatatransferrateinMbyte/s.Ontheotherhand,theCTPparameterhasbeen H removedfromtheWassenaarListformicroprocessorchips,whichiswhyBISdecidedto   implementanenduser/usecontrolformicroprocessorchips,i.e.,alicenseisrequiredonlywhen  senttomilitaryorweaponsofmassdestruction(proliferation)endusesorendusers.Therefore, X  themicroprocessortechnologyandhardwarearecontrolledintwodifferentways,andBISwill 0" notchangethecontrolparametersformicroprocessortechnologyabsentachangetothe $  WassenaarList. %X" OtherssuggestedthatBISimplementalicenseexceptionformicroprocessortechnologyalong )#& thesamelinesasLicenseExceptionENC:YXf@XXXԀi.e.,to(a)permitU.S.informationtechnology(IT) h+$( companiestotransfercontrolledknowledgetotheirforeignsubsidiaries;and(b)permitU.S.IT @-&* companiestotransfercontrolledknowledgetotheirlawfullyadmittedforeignnationalemployees  workingwithintheUnitedStates.Inreturn,companieswouldcommittoimplement ` fundamentalsafeguardsontheinternalmovementoftechnology.#Xf@XXYXf@F#Ԁ 8  ThistechnologyisalreadyeligibleforexportorreexportunderLicenseExceptionTSRto  ` countrieslistedinCountryGroupB.However,becauseoftheusefulnessofthistechnologyin 8  producinganddevelopingconventionalarmsandthesensitivityplacedonitbytheWassenaar   Arrangement,BIShasdecidedthatitwouldnotbeprudenttomakesuchtechnologyeligiblefor p  exportorreexportunderalicenseexceptiontoenduserslocatedincountriesthattheUnited H Stateshasdeterminedposeanationalsecurityconcern,i.e.,CountryGroupD:1countries.   Nonetheless,becauseotherWassenaarmembercountriesdonotrequirelicensesfordeemed p exportsofthistechnology,thisrulewillmakecertainmicroprocessortechnologyeligiblefor H LicenseExceptionCIVaftertheforeignnationalhasbeenapprovedviaaForeignNational   ReviewbyBIS.  WhileBIShasdecidedtoonlyallowdeemedexportsofthistechnologyunderlicenseexception 0" atthistime,BISrecognizesthatcertainlicensingrequirementsformicroprocessortechnology $  maybelimiting.Therefore,BIShasdiscussedwithotheragenciesapossibilityofallowingthe %X" export,reexport,ortransferofthistechnologythrougha SpecialIntracompanyLicense(SIL). '0!$ Thegoalistocreatealicensethatwilleasetheflowofcertainauthorizedtechnologyandsource )#& codewithintheglobalcorporatestructure,basedonanapprovedTechnologyControlPlan,i.e., h+$( aninternalcontrolprogram. @-&* Їf  g f  g f  g 3.WhatisthehighestCTPlevelformicroprocessorscurrentlybeingmanufacturedbyyour  company?f  g f  g  ` Manyrespondentseithersaidthatthisinformationwasproprietaryorthattheyhadalready   submittedthisinformationtoBIS.SomerespondentsprovidedCTPsintherangeof2,700  ` 24,170MTOPS. 8  f  g f  g f  g 4.WhatshouldbetheCTPMTOPSlimitationformicroprocessortechnologyunderthe p  proposedLicenseExceptionCIV?Pleaseprovidedetailedtechnicalandotherjustificationfor H yourproposal.f  g f  g    Ѐ p MostrespondentssaidLicenseExceptionCIVshouldhaveaCTPwithunlimitedMTOPS.This H rulemakesdeemedexportsofmicroprocessortechnologyatacertain_MTOPs_Ԁleveleligiblefor   LicenseExceptionCIV.WhileBISbelievesthatdeemedexportsaremoreeasilyenforced,  becausetheytakeplaceintheUnitedStates,BISisnotnaiveabouteffortsofothercountriesto X  obtainthisintegratedcircuittechnology,see69F.R.263605/12/04regarding_Suntek_ 0" Microwave,Inc.Therefore,BIShassetalimitontheMTOPSleveleligibleunderLicense $  ExceptionCIV. %X" Inaddition,atleasttworespondentsrequestedthatifwedonoteliminatetheCTPparameter )#& altogether,thentheCTPshouldbesetattwicetheMTOPSofwhatisincurrentproduction. h+$( TheyestimatedthatthiswouldresultinaCTPthresholdof50,000MTOPS.Thisfinalrule @-&* adoptsthe40,000MTOPSthresholdforeligibilityofdeemedexportsunderLicenseException  CIV,becausetheprojectedfuturetrendsoftechnologythresholds,whichwereprovidedby ` industry,didnotjustifyadoptingahigherMTOPSlevelatthistime. 8  Respondentssaidinsupportoftheproposedrulethattheexportcontrollevelformicroprocessor  ` technologyshouldmatchthatofmicroprocessorhardware.Oneofthecontrollingparametersfor 8  microprocessorchips,CTP,wasremovedfromtheWassenaarListin2003,whichiswhyBIS   decidedtoimplementanenduser/usecontrolformicroprocessorchips,i.e.,alicenseisrequired p  onlywhensenttomilitaryorweaponsofmassdestruction(proliferation)endusesorendusers. H Ontheotherhand,technologyandsoftwareforthedevelopmentandproductionof   microprocessorchipsislistedontheSensitiveList(Annex1)oftheWassenaarArrangement, p i.e.,33membercountrieshaveagreedthatthistechnologymustnotonlybeontheListofDual H useGoodandTechnologies,butmustbecarefullymonitoredbecauseoftheusefulnessofthis   technologyandsoftwareinproducinganddevelopingconventionalarms.Thecontrolling  parameterformicroprocessortechnologythathasbeenapprovedbytheWassenaarmember X  countriesunderECCN3E002is530MTOPS.Therefore,BIS,inkeepingwithitsagreementsto 0" theWassenaarArrangement,willnotbeeliminatingtheCTPparameterfortechnologytomatch $  thenolongerexistentCTPparameterformicroprocessorhardware. %X" AfewrespondentsclaimedthatmicroprocessortechnologycontrolledundertheEARisalready )#& availableabroad,becausemicroprocessorsandlikecommodities(graphicschips,IDE h+$( controllers,andnetworkrouters) requireabroadsetofdesignelements(Arithmeticlogicunit @-&* (ALU),memory,clockfrequency,andcontrolunit).Onerespondentwrote, Alloftheelements  arepresentandrequiredinallofthetechnologiesandeachrequiresapplicationofknowledgein ` eachoralloftheelements.Forexample,acurrentgenerationgraphicsprocessorchipcontains 8  ALU'scapableof100Gfof32BitFPperformance.Thislevelofperformancewouldbe   approximately50KCTPifthegraphicschipweretobesubjectedtoCTPanalysis.Export  ` controlsforalloftheexampleproducts,exceptforthemicroprocessor,arelimitedtoanti 8  terrorism(AT)controls.Therearenomulti-nationalcontrolsonthoseotherproducts.Thus,   countriesofconcerninComputerTier3CountryGroupcaneasilyobtaintheneededcomponent p  technologyandthensimplyre-packageitasamicroprocessor. H Ifthiswerefeasibleandsimpletodo,thencountriesaroundtheworldwouldbeproducing p microprocessorchipsandnotbuyingU.S.microprocessors.However,wehavefoundthatthisis H notthecase,andcountriesaroundtheworldgreatlyseeknotonlyU.S.manufactured   microprocessors,butthetechnologytoproduceanddevelopthem.Inaddition,gatheringbits  andpiecesoftechnologyfromdifferentsources,whilenoteasyinitself,doesnotprovideenough X  comprehensiveknowledgetoproduceahighqualitymicroprocessorchip. 0" f  g f  g f  g 5.Howdoothercountrieslicensethetransferofcomputertechnologyandsoftware,and '0!$ microprocessortechnology?Havetherebeeninstanceswhereyourcompanyhasbeenplacedat )#& acompetitivedisadvantagebasedoncurrentU.S.licenserequirements?f  g f  g  h+$(  @-&* eXf@XXXf@Themajorityofrespondentsstatedthattheydidnothaveaccesstospecificproceduresor  regulationsofothercountries'exportpolicieswithregardtocomputertechnologyandsoftware, ` andmicroprocessortechnology.Somecommentedthatthetechnologywaswidelyavailable 8  fromnonU.S.sourcesandthatthemajorityofothercountriesimposeminimalexport   restrictionsonthistypeoftechnology.#Xf@XXeXf@1i#pXXXXf@p]XpX  ` #pXXp]tk##Xf@XXpXUk#f  g f  g f  g 6.WhatareyourpredictionsfortheCTPlevelofmicroprocessorsthatwillbeinproduction3   and5yearsfromnow?Onwhatbasisdidyoumakeyourpredictions?f  g f  g  p  SomerespondentssaidtheyhadalreadyprovidedsuchinformationtoBIS.Somerespondents   providedtherequestedpredictions,basedonMooresLawandhistoricCTPinformation,as p follows: H 3yearpredictions:160,000MTOPS,250,000MTOPS,and400,000MTOPS   5yearpredictions:600,000MTOPSand640,000MTOPS  7yearprediction:1,000,000MTOPS X  f  g f  g f  g 7.Whatpercentageofyourresearchanddevelopmentisaccomplished:1)outsideoftheUnited $  States;and2)withtheassistanceofforeignnationalswithintheUnitedStates?f  g f  g  %X" SomerespondentssaidtheyhadalreadyprovidedsuchinformationtoBIS.Noneofthe )#& respondentsaddressedthisspecifically,butonerespondentnotedthatinthephysicalsciences h+$( andengineering,nearly50percentofallMastersandPhDdegreesawardedbyU.S.schoolsare @-&* earnedbyforeignnationals.  f  g f  g f  g 8.Isthereanalternativemethodorparameterforcontrollingexportsofcomputersand 8  microprocessorsandthetechnologyandsoftwarethereforethatindustrybelieveswouldbemore   inlinewiththewayindustryproduces,develops,ormeasurestheseitems?f  g f  g   ` Manyoftherespondentspointedoutthatperformancebasedcontrolsare unsuitedforgeneral   purposeandrapidlyadvancingtechnologiessuchassemiconductorsandcomputers.Many p  respondentswouldliketoseeenduseandenduserbasedcontrols.However,ithasbeen H determinedbyWassenaarArrangementmembersthattechnologyandsoftwareforthe   developmentandproductionofmicroprocessorsandcomputerswarrantextracareandhave p placedsuchtechnologyandsoftwareontheWassenaarSensitiveList(Annex1).These H technologyandsoftwarecontrolsarebasedontheirperformancecapabilities,andatthistimethe   onlymetricthattheregimemembershaveagreeduponisCTP.InkeepingwiththeWassenaar  Arrangementagreements,BISwillnotadoptaunilateralenduse/userbasedcontrolfor X  microprocessortechnology. 0" Inadditiontotheaboveresponsestothequestionsthatwereincludedintheproposedrule,BIS %X" receivedsomerecommendationsaboutECCN3A001.a.3.c,datatransferrate,anotherparameter '0!$ thatcontrolsmicroprocessors.SomerespondentsrecommendedthatBISsubmitaproposalto )#& Wassenaartohavethisparameterremoved,becauseitisoutdated.BIShasinthepastsubmitted h+$( proposalstoWassenaartoremovethisparameter,buthasnotbeensuccessfulingaining @-&* unanimousagreement.BISalsoreceivedcommentsfromindustryexplainingthat  microprocessortechnologyisalsocontrolledunderECCN3E001,becauseoftheECCN ` 3A001.a.3.ccontrols.IndustryadvisedthatthisefforttoexpandCIVunderECCN3E002would 8  beincompletewithoutasimilarexpansionofCIVunderECCN3E001.BISagreeswith   industrysassessmentofECCN3E001,asitcontrolsinterconnecttechnologyfor  ` microprocessorsunderECCN3A001.a.3.c.Therefore,thisfinalruleadoptsthis 8  recommendationbymakingdeemedexportsofcertainmicroprocessortechnologycontrolled   underECCNs3E001and3E002eligibleforLicenseExceptionCIV. p   RulemakingRequirements      1.ThisfinalrulehasbeendeterminedtobenotsignificantforpurposesofE.O.12866. p   2.Notwithstandinganyotherprovisionoflaw,nopersonisrequiredtorespondto,nor H shallanypersonbesubjecttoapenaltyforfailuretocomplywithacollectionofinformation,   subjecttotherequirementsofthePaperworkReductionAct(44U.S.C.3501etseq.)(PRA),  unlessthatcollectionofinformationdisplaysacurrentlyvalidOfficeofManagementandBudget X  (OMB)ControlNumber.Thisrulecontainsacollectionofinformationsubjecttothe 0" requirementsofthePRA.ThiscollectionhasbeenapprovedbyOMBunderControlNumber $  06940088(MultiPurposeApplication),whichcarriesaburdenhourestimateof58minutesto %X" prepareandsubmitformBIS748.Sendcommentsregardingthisburdenestimateoranyother '0!$ aspectofthiscollectionofinformation,includingsuggestionsforreducingtheburden,toDavid )#& Rostker,OfficeofManagementandBudget(OMB),byemailtoDavid_Rostker@omb.eop.gov, h+$( orbyfaxto(202)3957285;andtotheRegulatoryPolicyDivision,BureauofIndustryand @-&* Security,DepartmentofCommerce,P.O.Box273,Washington,DC20044. x     3.ThisruledoesnotcontainpolicieswithFederalismimplicationsasthattermisdefined ` underE.O.13132. 8    4.TheprovisionsoftheAdministrativeProcedureAct(5U.S.C.553)requiringnoticeof   proposed_rulemaking_,theopportunityforpublicparticipation,andadelayineffectivedate,are  ` inapplicablebecausethisregulationinvolvesamilitaryandforeignaffairsfunctionoftheUnited 8  States(5U.S.C.553(a)(1)).Further,nootherlawrequiresthatanoticeofproposed_rulemaking_   andanopportunityforpubliccommentbegivenforthisfinalrule.Becauseanoticeofproposed p  _rulemaking_Ԁandanopportunityforpubliccommentarenotrequiredtobegivenforthisrule H undertheAdministrativeProcedureActorbyanyotherlaw,theanalyticalrequirements   oftheRegulatoryFlexibilityAct(5U.S.C.601etseq.)arenotapplicable.Therefore,this p regulationisissuedinfinalform.Althoughthereisnoformalcommentperiod,publiccomments H onthisregulationarewelcomeonacontinuingbasis.CommentsshouldbesubmittedtoSharron   Cook,OfficeofExporterServices,BureauofIndustryandSecurity,DepartmentofCommerce,  P.O.Box273,Washington,D.C.20044.eXf@XXXf@ X  #Xf@XXeXf@u#ListofSubjects $  YXf@XXXf@15CFRPart740 '0!$   Administrativepracticeandprocedure,Exports,Reportingandrecordkeeping )#& requirements.#Xf@XXYXf@# h+$(  @-&* ЀYXf@XXXf@15CFRPart774    Exports,Reportingandrecordkeepingrequirements.#Xf@XXYXf@# `   Accordingly,parts740and774oftheExportAdministrationRegulations(15CFRparts   730799)are_amended_Ԁasfollows:  `   PART740[AMENDED]    "3"    32#  1  .3  0 `   Theauthoritycitationforpart740isrevisedtoreadasfollows:3݌p ` (#` (# Ќ  Authority:50U.S.C.app.2401etseq.;50U.S.C.1701etseq.;Sec.901911,Pub.L.106387; H E.O.13026,61FR58767,3CFR,1996Comp.,p.228;E.O.13222,66FR44025,3CFR,2001   Comp.,p.783;NoticeofAugust6,2004,69FR48763(August10,2004). p "3"    3"2#  2  .3  0 `   Section740.5isrevisedtoreadasfollows:3"[݌ ` (#` (# Ќ     f  g f  g 740.5f  g CivilEndusers(CIV). X  f  g (a)Scope.f  g f  g Ԁ LicenseExceptionCIVauthorizesexportsandreexportsofitemsontheCommerce $  ControlList(CCL)(SupplementNo.1topart774oftheEAR)thathavealicenserequirementto %`" theultimatedestinationpursuanttotheCommerceCountryChart(SupplementNo.1topart738 '8!$ oftheEAR)forNSreasonsonly;andidentifiedby"CIVYes"intheLicenseExceptionsection )#& oftheExportControlClassificationNumber(ECCN),providedtheitemsaredestinedtocivil p+$( endusersforcivilendusesinCountryGroupD:1,exceptNorthKorea(SupplementNo.1to H-&* part740ofthispart).  f  g (b)Restrictions.f  g f  g Ԁf  g f  g (1)Restrictedendusersandenduses.YoumaynotuseCIVifyou knowthe 8  itemwillbeorisintendedtobeexported,reexported,ortransferredwithincountrytomilitary   usesormilitaryendusers.Suchexports,reexports,andtransferswillcontinuetorequirea  h license.Inadditiontoconventionalmilitaryactivities,militaryusesincludeanyproliferation @  activitiesdescribedandprohibitedbypart744oftheEAR.   (2)VisaStatus.DeemedexportsunderLicenseExceptionCIVarenotauthorizedtoforeign P nationalsinanexpiredvisastatus.Itistheresponsibilityoftheexportertoensurethat,inthe ( caseofdeemedexports,theforeignnationalmaintainsavalidU.S.visa,ifrequiredtoholdavisa x fromtheUnitedStates. P f  g (c)ReportingRequirementf  g f  g . See743.1oftheEARforreportingrequirementsforexportsof  certainitemsunderf  thisf  g LicenseExceptionf  g .  h  f  g f  g (d)ForeignNationalReview(FNR)requirementfordeemedexports.(1)Submission $  requirement.PriortodisclosingeligibletechnologytoaforeignnationalunderthisLicense %`" Exception,youmustsubmitaForeignNationalReview(FNR)requesttoBIS,asrequiredunder '8!$ 748.8(s)oftheEAR.YourFNRrequestmustincludeinformationabouttheforeignnational )#& requiredunder748.8(t)oftheEARandsetforthinSupplementNo.2ofpart748oftheEAR. p+$(  H-&* (2)Confirmationofeligibility.YoumaynotuseLicenseExceptionCIVuntilyouhaveobtained  confirmationofeligibilitybycallingtheSystemforTrackingExportLicenseApplications ` (STELA),see750.5forhowtouseSTELA,orelectronicallyfromtheSimplifiedNetwork 8  ApplicationProcedure(SNAP),see4s O  5  http://www.bis.doc.gov/SNAP/index.htm6˝Oߝ   7#& Ԁformore   informationaboutSNAP.  `  (3)ActionbyBIS. WithinninebusinessdaysoftheregistrationoftheFNRrequest,BISwill   refertheFNRrequestg electronically,alongwithallnecessarydocumentationforinteragency x  review,orifnecessaryreturntheFNRrequestwithoutaction(f  g f  g e.g.f  g f  g ,iftheinformationprovidedis P incomplete).ProcessingtimestartsatthepointatwhichthenotificationisregisteredintoBIS's ( electronicsystem.    x  (4)Reviewbyotherdepartmentsoragencies.TheDepartmentsofDefense,State,Energy,and ( otheragencies,asappropriate,mayreviewtheFNRrequest.Within30calendardaysofreceipt  oftheBISreferral,thereviewingagencywillprovideBISwitharecommendationeitherto `  approveordenytheFNRrequest.f  Areviewingagencythatfailstoprovidearecommendation 8" within30daysf  Ԁg shallbedeemedtohavenoobjectiontothefinaldecisionofBIS. $  Ѐ(5)ActionontheFNRRequest.Aftertheinteragencyreviewperiod,BISwillpromptlynotify '8!$ theapplicantregardingtheFNRrequest,i.e.,whethertheFNRrequestisapproved,denied,or )#& moretimeisneededtoconsidertherequest. p+$( Ѐ H-&* Ї PART774[AMENDED]   "3"  3=2#  3  .3  0    ݀Theauthoritycitationforpart774continuestoreadasfollows:3=j݌8 (#(# Ќ  YXf@XXXf@  #Xf@XXYXf@H#Authority: X4XXXf@50U.S.C.app.2401etseq.;#Xf@XXX4#X4XXXf@Ԁ50U.S.C.1701etseq.;10U.S.C.7420;10  ` U.S.C.7430(e);18U.S.C.2510etseq.;22U.S.C.287c,22U.S.C.3201etseq.,22U.S.C.6004; @  30U.S.C.185(s),185(u);42U.S.C.2139a;42U.S.C.6212;43U.S.C.1354;46U.S.C.app.   466c;50U.S.C.app.5#Xf@XXX4 #;Sec.901911,Pub.L.106387;Sec.221,Pub.L.10756X4XXXf@;E.O.13026,61 x  FR58767,3CFR,1996Comp.,p.228;#Xf@XXX4ƨ#X4XXXf@ԀE.O.13222,66FR44025,#Xf@XXX4Q#Ԁ3CFR,2001Comp.,p.783; P NoticeofAugust6,2004,69FR48763(August10,2004).XXXXf@ ( #Xf@XXX#"3"  3m2#  4  .3  0    InSupplementNo.1topart774(theCommerceControlList),Category3Electronics, L ExportControlClassificationNumber(ECCN)3E001isamendedby_revising_Ԁthe CIV $ paragraphintheLicenseExceptionssection,toreadasfollows:3m݌(#(# Ќ  3E001"Technology"accordingtotheGeneralTechnologyNoteforthe"development"or 4" "production"ofequipmentormaterialscontrolledby3A(except3A292,3A980,3A981,  $  3A991or3A992),3B(except3B991or3B992)or3C.  %\"    `    ***** '4!$  LicenseExceptions  ) #&   CIV:0 ` Yesfordeemedexports,asdescribedin734.2(b)(2)(ii)oftheEAR,of t+$( technologyforthedevelopmentorproductionofmicroprocessormicrocircuits, L-&* micro-computermicrocircuits,andmicrocontrollermicrocircuitshavingf  Ԁthe  characteristicsdescribedin3A001.f  g a.3.cwithaCTPlessthanorequalto40,000 ` MTOPS(regardlessofwordlengthoraccesswidth).Deemedexportsunder 8  LicenseExceptionCIVaresubjecttoaForeignNationalReview(FNR)   requirement,see740.5oftheEARformoreinformationabouttheFNR.  ` LicenseExceptionCIVdoesnotapplytoECCN3E001technologyfor 8  3A001.a.3.crequiredforthedevelopmentorproductionofotheritemscontrolled   underECCNsbeginningwith3A,3B,or3C,ortoECCN3E001technologyalso p  controlledunderECCN3E003.H` (#` (# 0  TSR:0` (#(#*0 ` (#` (#*0 (# (#*p(#(#    `    *****   "3"  32#  5  .3  0    InSupplementNo.1topart774(theCommerceControlList),Category3Electronics,  ExportControlClassificationNumber(ECCN)3E002isamendedrevisingthe CIV X  paragraphintheLicenseExceptionssection,toreadasfollows:3$݌0"(#(# Ќ   X  3E002 TechnologyaccordingtotheGeneralTechnologyNoteotherthanthatcontrolled %X" in3E001forthe developmentor productionof microprocessormicrocircuits, '0!$  microcomputermicrocircuitsandmicrocontrollermicrocircuitshavinga composite )#& theoreticalperformance( CTP)of530milliontheoreticaloperationspersecond h+$(  @-&* (MTOPS)ormoreandanarithmeticlogicunitwithanaccesswidthof32bitsormore.            *0 *0 (# (#*0 (# (#*0 (# (#* ` (# (#  LicenseExceptions  @    CIV:0  Yes,fordeemedexports,asdescribedin734.2(b)(2XXf@XXXf@)(ii)oftheEAR,#Xf@XXXXf@#Ԁof technology   forthe developmentor productionofgeneralpurposemicroprocessorswithaCTP  p lessthanorequalto40,000MTOPS(regardlessofwordlengthoraccesswidth)f  . H  DeemedexportsunderLicenseExceptionCIVaresubjecttoaForeignNational   Review(FNR)requirement,see740.5oftheEARformoreinformationaboutthe   FNR.LicenseExceptionCIVdoesnotapplytoECCN3E002technologyalsorequired X forthedevelopmentorproductionofitemscontrolledunderECCNsbeginningwith 0 3A,3B,or3C,ortoECCN3E002technologyalsocontrolledunderECCN3E003.(#(#   TSR:  YXf@XXXf@*  * *#Xf@XXYXf@#Ԁ  X            * * * *  *         0 DATED:    PeterLichtenbaum    $  AssistantSecretary %h" forExportAdministration