BIS Amends Country Group Designations for Ukraine, Mexico, Cyprus

The Bureau of Industry and Security reduced licensing restrictions for certain exports to Ukraine, Mexico and Cyprus by revising their Country Group designations in the Export Administration Regulations (see 2011230010), according to a final rule released Dec. 23. The rule moves Ukraine from Country Group D to County Group B and adds Mexico and Cyprus in Country Group A:6, making more license exceptions available for each country. The changes take effect Dec. 28.

With the change, Ukraine is now eligible for license exceptions Shipments of limited value (LVS), Temporary imports, exports, reexports, and transfers (TMP), Servicing and replacement of parts and equipment (RPL), Gift parcels and humanitarian donations (GFT), Baggage (BAG), Aircraft and vessels (AVS), Additional permissive reexports (APR), and Encryption, commodities, software, and technology (ENC).

Exports to Ukraine will also benefit from a range of other loosened restrictions. License applications to export items to Ukraine that are listed on the Commerce Control List and controlled for national security reasons will no longer be subject to a case-by-case review policy and will now be subject to a licensing policy of approval, BIS said. And by removing Ukraine from Country Group D:1, the country will no longer be subject to “licensing requirements for reexports of the foreign-produced direct product of U.S.-origin technology and software,” BIS said. However, BIS said the license exception for shipments to Country Group B countries (GBS) and the license exception Technology and software under restriction (TSR) will not be available for exports to Ukraine.

BIS said it wanted to “allow a less restrictive licensing policy” for Ukraine. The country works with the U.S. on a “variety of export control matters,” BIS said, and is a member of several multilateral export control regimes, including the Australia Group, the Missile Technology Control Regime, the Nuclear Suppliers Group and the Wassenaar Arrangement.

The changes also make license exception Strategic Trade Authorization (STA) available for certain exports to Mexico, BIS said. The exception can be used for certain “lesser sensitivity items” controlled for national security reasons. BIS also pointed to Mexico’s participation in several multilateral export control groups -- including the Australia Group, the Nuclear Suppliers Group and Wassenaar -- and said Mexico has national security interests and policies “compatible” with the U.S.

Cyprus' addition to Country Group A:6 also makes exports to the country eligible for license exception STA for certain ‘lesser sensitivity items” controlled for national security reasons, BIS said. But the agency stressed that Cyprus remains in Country Group D:5 as a “U.S. Arms Embargoed” country and said “consideration of license exceptions” will still be subject to certain reviews and restrictions. BIS said it wanted to reduce restrictions on exports to Cyprus because it is a member of the European Union and implements the EU’s export control regulations. The agency also pointed to the State Department’s September decision to temporarily remove export restrictions on nonlethal defense goods and services to Cyprus (see 2009250005).