[Federal Register Volume 81, Number 233 (Monday, December 5, 2016)]
[Rules and Regulations]
[Pages 87426-87427]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-29057]
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
15 CFR Part 748
[Docket No. 161005927-6927-01]
RIN 0694-AH16
Amendment to the Export Administration Regulations: Removal of
Semiconductor Manufacturing International Corporation From the List of
Validated End-Users in the People's Republic of China
AGENCY: Bureau of Industry and Security, Commerce.
ACTION: Final rule.
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SUMMARY: In this rule, the Bureau of Industry and Security (BIS) amends
the Export Administration Regulations (EAR) to remove one end-user from
the list of validated end-users in the People's Republic of China
(PRC). Specifically, BIS amends Supplement Number 7 to part 748 of the
EAR to remove the Semiconductor Manufacturing International Corporation
(SMIC) as a validated end-user in the PRC. BIS makes this change at the
company's request, and not in response to activities of concern.
DATES: This rule is effective December 5, 2016.
FOR FURTHER INFORMATION CONTACT: Chair, End-User Review Committee,
Office of the Assistant Secretary, Export Administration, Bureau of
Industry and Security, U.S. Department of Commerce, Phone: 202-482-
5991; Email: [email protected].
SUPPLEMENTARY INFORMATION:
Background
Authorization Validated End-User
Validated end-users (VEUs) are designated entities located in
eligible destinations to which eligible items may be exported,
reexported, or transferred (in-country) under a general authorization
instead of a license. The names of the VEUs, as well as the dates they
were so designated, and their respective eligible destinations
(facilities) and items are identified in Supplement No. 7 to part 748
of the EAR (15 CFR part 748). Under the terms described in that
supplement, and in conformity with section 748.15 of the EAR, VEUs may
obtain eligible items without an export license from BIS. Eligible
items vary between VEUs, and may include commodities, software, and
technology, except items controlled for missile technology or crime
control reasons on the Commerce Control List (CCL) (part 774 of the
EAR).
VEUs are reviewed and approved by the U.S. Government in accordance
with the provisions of section 748.15 and Supplement Nos. 8 and 9 to
part 748 of the EAR. The End-User Review Committee (ERC), composed of
representatives from the Departments of State, Defense, Energy,
Commerce, and other agencies, as appropriate, is responsible for
administering the VEU program. BIS amended the EAR in a final rule
published on June 19, 2007 (72 FR 33646), to create Authorization VEU.
Amendment to the List of Validated End Users (VEU) in the People's
Republic of China (PRC)
Removal of the Semiconductor Manufacturing International Corporation
(SMIC) From the List of VEUs in the PRC
In this final rule, BIS amends Supplement No. 7 to part 748 of the
EAR (Supplement No. 7) to remove the VEU SMIC from the list of VEUs in
the PRC. Specifically, BIS removes information for SMIC from Supplement
No. 7. BIS takes this action at SMIC's request. BIS makes this change
to Supplement No. 7 at the company's request and not in response to
activities of concern.
Export Administration Act
Although the Export Administration Act expired on August 20, 2001,
the President, through Executive Order 13222 of August 17, 2001, 3 CFR,
2001 Comp., p. 783 (2002), as amended by Executive Order 13637 of March
8, 2013, 78 FR 16129 (March 13, 2013), and as extended by the Notice of
August 4, 2016, 81 FR 52587 (August 8, 2016), has continued the EAR in
effect under the International Emergency Economic Powers Act. BIS
continues to carry out the provisions of the Export Administration Act,
as appropriate and to the extent permitted by law, pursuant to
Executive Order 13222 as amended by Executive Order 13637.
Rulemaking Requirements
1. Executive Orders 13563 and 12866 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, reducing costs, harmonizing rules, and promoting flexibility.
This rule has been determined to be not significant for purposes of
Executive Order 12866.
2. This rule involves collections previously approved by the Office
of Management and Budget (OMB) under Control Number 0694-0088, ``Multi-
Purpose Application,'' which carries a burden hour estimate of 43.8
minutes to prepare and submit form BIS-748; and for recordkeeping,
reporting and review requirements in connection with Authorization VEU,
which carries an estimated burden of 30 minutes per submission. Total
burden hours associated with the Paperwork
[[Page 87427]]
Reduction Act of 1995 (44 U.S.C. 3501 et seq.) (PRA) and OMB Control
Number 0694-0088 are not expected to increase significantly as a result
of this rule. Notwithstanding any other provisions of law, no person is
required to respond to, nor be subject to a penalty for failure to
comply with a collection of information subject to the requirements of
the PRA, unless that collection of information displays a currently
valid OMB Control Number.
3. This rule does not contain policies with Federalism implications
as that term is defined under Executive Order 13132.
4. Pursuant to the Administrative Procedure Act (APA), 5 U.S.C.
553(b)(B), BIS finds good cause to waive requirements that this rule be
subject to notice and the opportunity for public comment because they
are unnecessary. In determining whether to grant or remove VEU
designations, a committee of U.S. Government agencies evaluates
information about and commitments made by candidate companies, the
nature and terms of which are set forth in 15 CFR part 748, Supplement
Nos. 8 and 9. The criteria for evaluation by the committee are set
forth in 15 CFR 748.15(a)(2) and the authority to remove VEU
designations is contained in 15 CFR 748.15(a)(3). The information,
commitments, and criteria for this extensive review were all
established through the notice of proposed rulemaking and public
comment process (71 FR 38313 (July 6, 2006) (proposed rule), and 72 FR
33646 (June 19, 2007) (final rule)). In publishing this final rule, BIS
removes a VEU from the list of VEUs in the PRC, at the request of the
VEU, similar to past requests by other VEUs, approved by the End-User
Review Committee. This change has been made within the established
regulatory framework of the VEU program. Further, this rule does not
abridge the rights of the public or eliminate the public's option to
export under any of the forms of authorization set forth in the EAR.
Publication of this rule in other than final form is unnecessary
because the procedure for revocation of a VEU or facility from the
Authorized VEU list is similar to the license revocation procedure,
which does not undergo public review. During the VEU revocation
procedure, the U.S. Government analyzes confidential business
information according to set criteria to determine whether a given
authorized VEU entity remains eligible for VEU status. Revocation may
be the result of a material change in circumstance at the VEU or the
VEU's authorized facility. Such changes may be the result of a VEU or
VEU facility no longer meeting the eligibility criteria for
Authorization VEU, and may thus lead the U.S. Government to modify or
revoke VEU authorization. VEUs or VEU facilities that undergo material
changes that result in their no longer meeting the criteria to be
eligible VEUs must, according to the VEU program, have their VEU status
revoked. Here, however, SMIC requested removal from the VEU program.
Consequently, BIS is removing SMIC from the list of VEUs. Public
comment on whether to make the removal is unnecessary.
Section 553(d) of the APA generally provides that rules may not
take effect earlier than thirty (30) days after they are published in
the Federal Register. However, BIS finds good cause to waive the 30-day
delay in effectiveness for this rule pursuant to 5 U.S.C. 553(d)(3)
because the delay would be contrary to the public interest. BIS is
simply removing SMIC as a VEU. In this rule, BIS amends the EAR
consistent with established objectives and parameters administered and
enforced by the responsible designated departmental representatives to
the End-User Review Committee. Delaying this action's effectiveness
would likely cause confusion regarding which items are authorized by
the U.S. government, and in turn stifle the purpose of the VEU program.
Accordingly, it would be contrary to the public interest to delay this
rule's effectiveness.
No other law requires that a notice of proposed rulemaking and an
opportunity for public comment be given for this final rule. Because a
notice of proposed rulemaking and an opportunity for public comment are
not required under the APA or by any other law, the analytical
requirements of the Regulatory Flexibility Act (5 U.S.C. 601et seq.)
are not applicable. As a result, no final regulatory flexibility
analysis is required and none has been prepared.
List of Subjects in 15 CFR Part 748
Administrative practice and procedure, Exports, Reporting and
recordkeeping requirements.
Accordingly, part 748 of the EAR (15 CFR parts 730-774) is amended
as follows:
PART 748--[AMENDED]
0
1. The authority citation for part 748 continues to read as follows:
Authority: 50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; E.O.
13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR
44025, 3 CFR, 2001 Comp., p. 783; Notice of August 4, 2016, 81 FR
52587 (August 8, 2016).
Supplement No. 7 to Part 748--[AMENDED]
0
2. Amend Supplement No. 7 to Part 748 by removing the entire entry for
``Semiconductor Manufacturing International Corporation,'' in ``China
(People's Republic of)''.
Dated: November 23, 2016.
Kevin J. Wolf,
Assistant Secretary for Export Administration.
[FR Doc. 2016-29057 Filed 12-2-16; 8:45 am]
BILLING CODE 3510-33-P