February 1, 2000


                              THE WHITE HOUSE

                       Office of the Press Secretary

For Immediate Release                                  February 1, 2000

                                FACT SHEET

                       Export Controls on Computers

The President today announced an update of U.S. export controls on
computers that will promote our national security, enhance the
effectiveness of our export control system, and ease unnecessary regulatory
burdens on both government and industry.

Today?s announcement is President Clinton?s fourth revision to U.S. export
control parameters since 1993.  This action reflects the Clinton
Administration?s efforts to ensure effective controls on militarily
sensitive technology while taking into account the increased availability
of commodity products, such as servers and workstations, of which millions
are manufactured and sold worldwide every year.

The Administration?s computer export controls are designed to permit the
government to calibrate control levels and licensing conditions depending
upon the national security or proliferation risk posed at a specific
destination, to enhance U.S. national security by ensuring controls on
computer exports are effective, and to minimize impediments to legitimate
computer exports, which will help preserve the technological lead of the
U.S. computer industrial base.

As directed by the President in July 1999, the Administration has conducted
a review of our computer export controls that took into account (1)
advancements in computing technology since mid-1999, (2) our security,
nonproliferation and other national security interests, and (3) the need
for a policy that would remain effective for at least six months.

This review found that advancements continue in the power and capabilities
of widely available computing systems, reflecting the exponential growth in
individual microprocessor speeds that has occurred since 1995.  The speed
of the general purpose microprocessor used in standard personal computers
and business applications today has increased by a factor of eight since
the Administration?s 1995 decision took effect.  This growth will continue
? U.S. companies plan commercial sales of individual ?chips? rated over
5000 MTOPS by late 2000.   Moreover, while there are military The term
"military" encompasses nuclear, chemical, biological, missile or
conventional military end-users/uses. applications across a range of MTOPS
levels, the national security agencies have reaffirmed their previous
conclusion that there is no definitive line that separates levels of
computing power on the basis of their usefulness for military applications.
In light of this finding, the advances in basic computing technologies, and
the problems inherent in trying to control commodity level items, the
Administration has determined that widespread commercial availability of
computers with performance capabilities up to 12,500 MTOPS makes that a
realistic and enforceable control level.

The Revised Controls

The revised controls announced today maintain the four country groups
announced in 1995, but amends the countries in, and control levels for,
Tier 2 and Tier 3 as follows:

Tier I (Western Europe, Japan, Canada, Mexico, Australia, New Zealand,
Hungary, Poland, the Czech Republic and Brazil): Exports without an
individual license are permitted for all computers (i.e. there is no prior
government review).

Tier II (South and Central America, South Korea, ASEAN, Slovenia, most of
Africa): Exports without an individual license are permitted up to 20,000
MTOPS with record-keeping and reporting as directed; individual licenses
(requiring prior government review) are needed above 20,000 MTOPS.

?    Today?s decision will raise the individual licensing level from 20,000
MTOPS to 33,000 MTOPS immediately.

?    The President?s decision today will move Romania from Tier 3 to Tier
2.  As required by the National Defense Authorization Act of 1998, this
decision requires a 120-day congressional notification before it becomes

Tier III (India, Pakistan, all Middle East/Maghreb, the former Soviet
Union, China, Vietnam, Central Europe): Based on President Clinton?s July
1999 decision, exports are permitted without an individual license up to
6,500 MTOPS, and require individual licenses for military end-uses and
end-users above that figure.  Exports without an individual license are
permitted for civil end-users between 6,500 MTOPS and 12,300 MTOPS, with
exporter record keeping and reporting as directed.  Individual licenses are
required for all end-users above 12,300 MTOPS.

?    The President?s decision today will maintain the current two-level
system for civilian and military/proliferation end-users.  The decision
will raise the individual licensing levels from 6,500 to 12,500 MTOPS for
military end-users and from 12,300 to 20,000 MTOPS for civilian end-users.

?    The Commerce Department will immediately raise the licensing level for
civilian end-users and will raise the licensing level for military
end-users in six months, at the same time as it adjusts the level that
triggers the NDAA notification requirement, which is discussed below.

The 1998 National Defense Authorization Act (NDAA), P.L. 105-85, imposed a
requirement for companies to provide the Commerce Department with prior
notice of exports for systems above 2,000 MTOPS to all Tier 3 end-users.
U.S. export control agencies have 10 days to inform the company if it must
apply for a license.   The President?s July 1999 decision raised the NDAA
notification level to 6,500 MTOPS; that decision became effective on
January 23, 2000 (the end of the 180-day Congressional notification

?    The President?s decision today will raise the NDAA notification level
from 6,500 MTOPS to 12,500 MTOPS.  The President will advise the
appropriate Congressional committees of his decision to raise the NDAA
notification level.  By law, Congress has six months to review this
decision, after which the change to NDAA notification level will go into

?    The Administration will continue to review the licensing levels and
the NDAA notification level to determine if further adjustments are
warranted.   Given anticipated  significant increases in individual
microprocessor performance in the near term, the Administration will review
these levels by April 2000 to determine if further adjustments are

Tier IV (Iraq, Iran, Libya, North Korea, Cuba, Sudan, and Syria).  There
are no planned changes for Tier IV, current policies continue to apply
(i.e. the United States will maintain a virtual embargo on computer

For all these groups, reexport and retransfer provisions continue to apply.
The revised controls will become effective when they are implemented in
formal Commerce Department regulations.  We will continue to implement the
Enhanced Proliferation Control Initiative (EPCI), which provides authority
for the government to block exports of computers of any level in cases
involving exports to end-uses or end-users of proliferation concern or
risks of diversion to proliferation activities.  Criminal and civil
penalties apply to EPCI violators.

In addition, the Department of Commerce will continue to add to its list of
published entities of concern as a means of informing exporters of
potential proliferation and other security risks.  The Department will
remind exporters of their duty to check suspicious circumstances and
inquire about end-uses and end-users.  Exporters are advised to contact the
Department of Commerce if they have any concern with the identity or
activities of the end-users.   The Commerce Department also will work to
expand its efforts  --  through public seminars and consultations with
companies -- to keep industry regularly informed regarding problem
end-users and programs of proliferation concern.

Microprocessor Controls.  In addition to revising computer export controls,
the Administration revised controls on general-purpose microprocessors on
November 26, 1999  by raising the control level  from 1900 MTOPS to 3500
MTOPS.  Export control agencies agree that general purpose or ?mass market?
microprocessors are not controllable because they are used in virtually all
consumer and business personal computers, are highly portable, and are sold
in very large quantities through multiple distribution channels worldwide.
The November 26, 1999 change was made given the continuing increases in
microprocessor technology.  We will continue to review microprocessor
technology and will adjust controls as necessary.   We also will continue
to maintain controls on higher performance, general-purpose microprocessors
that are sold in small quantities for high-end computer and other
applications, and those application-specific microprocessors that have
military applications and are sold in relatively small quantities.

Legislative Proposal.  The National Defense Authorization Act of 1998
requires a six-month Congressional notice period if the President decides
to raise the level that triggers the 10-day pre-export notification
requirement for Tier 3 countries, and a four-month notice if the President
decides to move a country out of  Tier 3.  The six-month notice period in
particular limits our ability to respond quickly to rapid changes in
technology.  We will continue to work with Congress to change both waiting
periods to one month.

On a longer-term basis, we will work with Congress to adopt an approach
that permits us to adjust our export controls in a predictable and timely
manner when we are faced with the practical impossibility of controlling
items so widely available that they amount to commodity items, like
computers and microprocessors, which are sold by the hundreds of thousands
and even millions.

Multilateral Coordination: The Administration is consulting with other
nations in the context of our common controls on high performance
computers, and with the members of the Wassenaar Arrangement -- the
multilateral successor to COCOM, to ensure that they understand the basis
for the changes in controls.  We are committed to working closely with them
to adjust multilateral controls to reflect technological advances and
collective security concerns.  Our controls are consistent with the
purposes of the Wassenaar Arrangement -- to deny arms and sensitive
dual-use technologies to countries of  concern, and to develop mechanisms
for information sharing among the partners as a way to harmonize our export
control practices and policies.

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