A. U.S. EXPORT CONTROLS
The United States had a generally strict export control policy toward the Soviet Union. With the dissolution of that state, the United States is now liberalizing its controls toward Russia and the other emerging democracies among the countries of the former Soviet Union. The United States has a multi-agency export control organization devoted to the task.
1. Dual-Use Export Controls
The Department of Commerce administers export controls for items that can be used both for military and civilian dual-use purposes. Recent changes in the Department of Commerce export control regulations have significantly increased the potential for high technology trade with Russia. The Commerce Department's Section 799.1 of the Export Administration Regulations (EAR) contains the list of controlled commodities and technical data.
On September 1, 1991, a new Commerce Control List (CCL) went into effect. The CCL greatly reduced the number of items controlled for reasons of national security, provided more specific descriptions of the items controlled, aligned control parameters with current industry standards, decontrolled items which are readily available "off-the-shelf" in everyday commerce, and improved harmonization with the tariff system implemented by the U.S. Customs Service. In addition, U.S. export control policy has changed from a presumption of denial to a presumption of approval for an export to Russia as long as the export is destined for civilian end-uses or purposes, the end-use is not military or for defense purposes, or the end-user is not a military organization.
The United States and its partners in the now-defunct COCOM agree that the maintenance of some export controls on Russia remains strategically necessary. The more sophisticated the technology, the more likely it will require an export license. U.S. industry is advised that one-on-one visits, conversations, and training may involve exports of technical data if they include discussions concerning controlled commodities, and could require an export license. The visit, conversations, or training representing the export may be in the United States or Russia. U.S. companies should therefore consult the Bureau of Export Administration (BXA) before engaging in consultations and/or business transactions involving the export of controlled dual-use commodities and technical data.
All goods and technology on the CCL require an export license. If a firm, enterprise, or exporter is unsure of the type of export license required, the Export Administration Regulations (15 CFR §730 - 799) should be consulted, or a call placed to the Exporter Counselling staff at (202) 482-4811. To determine how a particular commodity or technical data is classified, follow the procedure listed below to obtain a commodity classification.
B. How to Obtain a Commodity Classification:
1. From the Manufacturer: The manufacturer should be able to provide the proper commodity classification (Export Control Commodity Number[s]).
2. Company Engineer: A company engineer who has technical expertise and knows the product well can review Section 799.1 of the Export Administration Regulations (CFR 15) against a product's technical parameters and try to categorize/classify the commodity.
3. Official Request to OExS: Submit an official request to the Office of Exporter Services (OExS). Follow the procedures below.
a. Submit the following information:
i. A cover letter including a technical analysis.
ii. Product brochures with detailed technical specifications.
iii. List specific commodities of concern (5 or less per request).
iv. Include model numbers if applicable.
b. Include the following information in your cover letter.
i. A recommended classification for the commodities.
ii. The reasons for the recommendations, including a technical analysis of the commodities in terms of the technical parameters specified in the regulations, and
iii. The reasons for providing a classification, if one does not provide a technical analysis, including, as appropriate, any/all ambiguities or deficiencies in the regulations that preclude making a technically accurate analysis or classification.
c. Once BXA has classified the commodity, the individual will receive in reply an official letter containing the classification. BXA provides commodity classifications only in writing. BXA does not consider any verbal advice received from the Exporter Counselling Division, or any other unit of BXA to be a formal agency determination or binding.
4. Send the information to the following address:
U.S. Department of Commerce
Office of Exporter Services
P.O. Box 273
Washington, D.C. 20044
Phone: (202) 482-4905
Fax: (202) 219-9179
2. Defense Export Controls
The United States controls the export of all defense items and the Department of State is responsible for these export controls. The State Department's International Traffic in Arms Regulations (ITAR) contains a list of defense articles which the Department of State controls.
Although it is the policy of the United States to deny exports of defense articles to proscribed destinations, including Russia, the Department of State anticipates that U.S. industry will receive requests for defense equipment or services. Prior to engaging in any consultations or transactions involving the export of defense articles, including technical data and technical assistance, companies should consult with the Department of State, Center for Defense Trade, Office of Defense Trade Controls or Office of Defense Trade Policy. They may be reached as follows:
PM/DTC, SA-6, Room 200
Office of Defense Trade Controls (DTC)
Bureau of Politico-Military Affairs
U.S. Department of State
Washington, D.C. 20522-0602
PM/DTP, Room 7815
Office of Defense Trade Policy
Bureau of Politico-Military Affairs
U.S. Department of State
Washington, D.C. 20520-7815
B. RUSSIAN EXPORT CONTROL POLICIES AND PRACTICES
The June 1992 Charter for American-Russian Partnership and Friendship announced that "the United States and Russia agree that the process of normalization of technology trade is based on Russian determination to adhere strictly to world standards of export controls in the area of the nonproliferation of weapons of mass destruction and related technologies, missiles and missile technology, destabilizing conventional armaments, and dual-use goods and technologies."
Since then, Russia and the other nations of the former Soviet Union have regularly voiced their commitment to deny weapons of mass destruction, chemical and biological weapons, and launch vehicles to countries of concern. In a state of the nation address in February 1994, for example, Russian President Yeltsin proclaimed, "We are coming out unequivocally in favor of strengthening the regime of non-proliferation of weapons of mass destruction and the latest military technologies."
2. Russian Export Controls
According to Russian export control officials, the Russian Federation export control system has the following objectives:
1) protection of Russian state economic interests;
2) control of the export of raw materials that are used in developing missiles and weapons of mass destruction; and
3) control of items which are used in developing weapons of mass destruction, thereby preventing their proliferation, and meeting Russian international obligations.
President Yeltsin has issued a series of decrees since 1992 that provide the legal basis for developing export controls in Russia. The decrees established an interagency Russian Export Control Commission (ECC) that ensures a unified policy on the export of special weapons and related technologies. The ECC makes decisions on controversial applications for most types of sensitive exports, including nuclear dual-use items and missile, chemical, and biological weapons-related items.
Besides creating the Export Control Commission, President Yeltsin also established in 1992 the Interagency Commission on Military-Technical Cooperation to review applications for conventional weapons exports. Both commissions include representatives of the Russian Ministries of Foreign Affairs, Foreign Economic Relations, Economics, and Defense.
Government decrees also establish lists of items subject to control.
One list corresponds to what was COCOM's Industrial List and includes items such as strategic raw materials and dual-use products. Other lists cover nuclear-, missile-, chemical-, and biological-related materials and are typically based on international lists such as those of the Missile Technology Control Regime and the Nuclear Suppliers Group. Although the Russia is not a member of the MTCR, it adheres to it and considers its rules to be more strict than those called for by the MTCR.
The Russians indicate they followed the recommendations of the Australia Group for their lists of both chemical- and biological-related items, although there are some discrepancies.
The Russian Government requires exporters seeking to ship controlled commodities to submit applications for an export license to the Ministry of Foreign Economic Relations (MFER). MFER forwards complicated cases to the Export Control Commission. If the Commission approves the export, then the Ministry issues the license. For non-industrial, non-dual use commodities, (e.g., military or nuclear items), the Russian Ministry overseeing the industry sector that produces the commodity (e.g., the Ministry of Defense or the Ministry of Atomic Energy) has to give written pre-clearance of the export before the MFER can grant the license.
MFER bases a positive decision on the availability of the item and the importer's agreement not to use the item, directly or indirectly, for purposes banned by the international regimes. The Russian government also prohibits the foreign importer from reexporting the item without written authorization of the Russian exporter. The recipient country is required to document these safeguards. The Russians also consider whether the importing country is a member of multilateral organizations in the area of nonproliferation; whether the importing country was ever denied the transfer of regulated technologies; whether the importing country ever used legal imports for purposes inconsistent with the obligations the Russians follow, etc.
The Russians are improving their criminal penalties. The legislature, early in 1993, added a law which provides for three to eight years imprisonment for the illegal export of items from the controlled lists. Additionally, the Ministry of Justice has been directed to prepare proposals to institutionalize legal and administrative liability for unlawful exports.
Notwithstanding some evident progress, Russia has more work to do--particularly in the enforcement area--to have an effective export control system. Although Russian customs officials routinely intercept contraband shipments of strategic metals and petroleum, regulated materials, including small arms and radioactive materials, are making their way out without proper licensing. Inadequate funding has constrained hiring of border guards and limited the training programs that would better qualify them to identify sensitive materials and administer export controls. Resource problems also limit Russia's ability to educate Russian industries on new export control regulations, although Russia has advertised new export control regulations in the press. Corruption has also complicated efforts to control weapons and technology transfers. For example, customs officials are notorious for their susceptibility to bribes. Russian export controls continue to suffer from a poorly defined legal system that does not provide a basis for control. Decrees--not Russian law--largely provide the current basis of Russia's export controls.
C. RUSSIAN MULTILATERAL CONTROL INITIATIVES
In June 1992, the COCOM member nations established a Cooperation Forum (CCF) and invited Russia and the other reforming nations in the former Soviet Union to participate. The CCF was intended to provide a forum to discuss international standards for export controls as well as a mechanism to coordinate technical assistance efforts.
Russian delegates to the inaugural meeting of the CCF in November 1992 in Paris enthusiastically endorsed COCOM's plans to liberalize trade with former Soviet bloc countries as they establish the export controls necessary to prevent unauthorized transfers of sensitive technologies. Russia is a signatory to the Nuclear Non-Proliferation Treaty, and a member of the Nuclear Suppliers Group. It has also signed the Chemical Weapons Convention that bans the transfer of chemicals with military applications. Russian officials claim that Russia's controls over missile-related transfers are based on the Missile Technology Control Regime, and the U.S. Government has classified Russia as an MTCR "adherent."