Where Industry and Security Intersect
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The U.S. Government exercises export controls over certain microorganisms, toxins, biological equipment, and related technology to further U.S. foreign policy interests in opposing the proliferation and use of biological weapons. The U.S. Government implements these export controls multilaterally in coordination with the Australia Group (AG), a forum of 38 nations cooperating to halt the proliferation of chemical and biological weapons. The U.S. Government also supports international efforts to effect a total ban on biological weapons in compliance with the Convention on the Prohibition of the Development, Production and Stockpiling of Bacteriological (Biological) and Toxin Weapons and on Their Destruction (BWC).15
The licensing requirements for biological agents, related equipment, and technology, as specified on the Commerce Control List (CCL), are as follows:
A. The U.S. Government requires a license for the export to all destinations of certain human pathogens, zoonoses, toxins, animal pathogens, genetically modified microorganisms, and plant pathogens, and the technology for their production and/or disposal.
The U.S. Government requires a license for the export to specified countries of certain dual-use equipment and materials that can be used in the production of biological agents, and related production technology. The countries for which this licensing requirement applies are those indicated in Column CB:3 of the Commerce Country Chart, Supplement No. 1 to Part 738 of the EAR, as well as the embargoed destinations identified in EAR Part 746.
On March 18, 2004, the Department of Commerce published a rule reflecting AG intersessional agreements and June 2003 AG Plenary agreements. At the urging of the United States, 12 new viruses and two new bacteria were added to the list of AG-controlled human and zoonotic pathogens and toxins described on the CCL (69 FR 12789).
On May 6, 2004, the Department of Commerce published a rule that revised the Commerce Control List to conform the description of certain protection and detection equipment to those that are found in the Wassenaar Arrangement List of Dual Use Goods and Technologies (the Dual Use List). This rule imposed national security and anti-terrorism license requirements on those items, and imposed antiterrorism controls on certain items that are excluded from the Dual Use List. This rule also revised Export Control Classification Number (ECCN) 1A004, which had previously referred exporters to the U.S. State Department Directorate of Defense Trade Controls for “protective and detection equipment and components, not specially designed for military use.” ECCN 1A004 now places Department of Commerce national security and antiterrorism controls on gas masks and filter canisters, protective suits, gloves, and shoes specially designed or modified for defense against biological agents or radioactive materials adapted for use in war, or chemical warfare agents, and on certain nuclear, chemical, and biological detection systems in a manner that emulates entry 1.A.4 on the Dual Use List. The rule also created ECCN 1A995, and imposed antiterrorism controls on radiation monitoring dosimeters and equipment limited by design or function to protect against hazards specific to civil industries that are excluded from ECCN 1A004. ECCN 1A995 excludes protection materials used in or for consumer goods packaged for retail sale and medical products; these commodities are EAR99 (69 FR 25312).
On December 29, 2004, the Department of Commerce published a rule in the Federal Register implementing the AG decisions from the June 2004 AG Plenary and subsequent AG intersessional agreements (69 FR 77890). Beyond the addition of five new pathogens (three new bacteria and two new viruses) to the AG control list and the CCL, as well as the decontrol of medical products containing conotoxins, this rule amended the EAR adding the five new member countries to the AG – Estonia, Latvia, Lithuania, Malta, and Slovenia – and removed Bulgaria from the EAR list of countries of concern for chemical and biological reasons. This rule also revised the AG-related licensing policies in the EAR to add the AG Guideline that requires participating countries to take into consideration the extent and effectiveness of the export control system of the importing, and any intermediary country, when evaluating export license applications.
The U.S. Government also controls items subject to the EAR because of biological end-use or end-user concerns. These controls are part of the Enhanced Proliferation Control Initiative (EPCI), announced by President George H. W. Bush on December 13, 1990.
The U.S. Government requires a license for the export of any commodity, technology, or software when the exporter knows that it will be used in the design, development, production, stockpiling, or use of biological weapons in, or by, specific countries (Country Group D:3, EAR, Part 740, Supplement No. 1).16 In addition, the U.S. Government may inform an exporter or reexporter that a license is required due to an unacceptable risk that the items will be used in, or diverted to, biological weapons proliferation activities anywhere in the world.
No U.S. person may knowingly support such an export, reexport, or transfer without a license. “Support” is defined as any action, including financing, transportation, or freight forwarding, that facilitates the export, reexport, or transfer of these items.
In addition, no U.S. person may, without a license, perform any contract, service, or employment knowing that it will directly assist in the design, development, production, stockpiling, or use of biological weapons in, or by, a country listed in Country Group D:3.
B. The Department of Commerce will review applications for licenses on a case-by-case basis to determine whether the export would make a material contribution to the design, development, production, stockpiling, or use of biological weapons. When the Department of Commerce determines that an export will make such a contribution, we will deny the application.
The controls described above are intended to prevent a U.S. contribution to the proliferation and illegal use of biological weapons, and to support multilaterally coordinated control efforts. The controls also provide the regulatory authority to stop the export of any item from the United States when there is a significant risk that it will be used for biological weapons purposes. The controls implement certain measures directed in Executive Order 12735 of November 16, 1990, its successor, Executive Order 12938 of November 14, 1994, and the Enhanced Proliferation Control Initiative (EPCI) announced on December 13, 1990.
The U.S. Government implements these controls in coordination with the AG. The AG works to accomplish this objective through the harmonization of export controls, the exchange of information, and other diplomatic means. In addition, these EAR controls demonstrate the commitment of the United States to its obligation under the BWC not to develop, produce, stockpile, acquire, or retain biological agents, weapons, equipment, or the means of delivery for warfare purposes, or to assist others in such activities. The controls also advance the goals of the 1925 Geneva Protocol for the Prohibition of the Use in War of Asphyxiating, Poisonous or other Gases and of Bacteriological Methods of Warfare (Geneva Protocol), prohibiting the use in war of chemical or biological weapons.
B. Considerations and/or Determinations of the Secretary of Commerce
1. Probability of Achieving the Intended Foreign Policy Purpose. The Secretary has determined that these controls are likely to achieve the intended foreign policy purpose, in light of other factors, including the U.S. Government’s negotiations with its partners in the AG and in the BWC. The Secretary has made this determination despite the existence of certain factors, including availability of these items from other sources, that challenge that achievement. These controls affirm U.S. opposition to the development, proliferation, and use of biological weapons and serve to distance the United States from such activities.
2. Compatibility with Foreign Policy Objectives. The Secretary has determined that these controls are compatible with U.S. foreign policy objectives; and that the extension of these controls will not have any significant adverse foreign policy consequences. The U.S. Government has a strong interest in remaining at the forefront of international efforts to stem the proliferation of biological weapons. Also, these controls are compatible with the multilateral export controls for biological materials agreed to by the AG.
3. Reaction of Other Countries. The Secretary has determined that any adverse reaction to these controls is not likely to render the controls ineffective, nor will any adverse reaction by other countries be counterproductive to U.S. foreign policy interests. The U.S. Government continues to discuss biological export controls with countries outside of the AG to advance the goals of nonproliferation.
4. Economic Impact on U.S. Industry. The Secretary has determined that any adverse effect of these controls on the economy of the United States, including on the competitive position of the United States in the international economy, does not exceed the benefit to United States foreign policy objectives.
In FY 2004, the Department of Commerce approved 1,412 license applications, valued at $42 million, for the export or reexport of biological agents and equipment. The vast majority of the licenses approved were for toxins in ECCN 1C351. The Department of Commerce denied 6 license applications for biological agents/equipment valued at $256,000, and returned without action 54 license applications valued at $153,000. The primary reason cited for returning applications was for insufficient information about the transaction.
5. Effective Enforcement of Controls. The Secretary has determined the United States has the ability to effectively enforce these controls. Enforcing controls on biological weapons-related materials poses problems similar to the enforcement of chemical controls, but with additional difficulties. Biological materials are microscopic organisms that require technical expertise and specialized facilities to identify and to handle them. Because of their size, biological agents can often be concealed and transported with ease.
To meet the challenge of effective enforcement of these proliferation controls, the Department of Commerce has redirected resources toward preventive enforcement. Enforcement personnel conduct an extensive, ongoing outreach program to educate industry about export controls. The program also is designed to increase industry’s awareness of suspect orders for products or equipment that could be used for biological weapons proliferation. In cases where unlicensed shipments of biological materials have already taken place, the Department of Commerce has found that, as in other export control enforcement cases, commercial shipping documentation can form the basis for successful investigations and prosecutions.
Exporters of biological products include commercial firms as well as academic and government entities. The Department of Commerce maintains ongoing interaction with individual exporters, Technical Advisory Committees (TACs), and trade associations to discuss proposed export transactions and marketing plans to facilitate the thorough, yet prompt, review of export license applications. Through the TACs, the Department of Commerce keeps industry representatives abreast of licensing proposals for items on the control list and gives them the opportunity to provide technical input. During the reporting period, the Department of Commerce representatives participated in briefings on chemical/biological export control issues for associations such as the American Biological Safety Association.
In a September 28, 2004, Federal Register notice, the Department of Commerce solicited comments from industry on the effectiveness of U.S. foreign policy-based export controls. Comments were solicited from all six of the Department’s TACs, which advise the Department, as well as from the President’s Export Council Subcommittee on Export Administration. Comments also were solicited from the public via the BIS Web page. The comment period closed on November 19, 2003, and 12 comments were received.
One comment addressed multilateral control regimes including the AG. The commentator asserted that the language in the EAR differs significantly from that in the multilateral texts; and, therefore, the controls are properly considered unilateral controls rather than multilateral ones. He suggested numerous changes to bring the EAR into compliance with the various multilateral texts to eliminate these unilateral controls and make sure that the U.S. controls conform with commitments made to multilateral organizations. The commentator also argued that greater compliance by members of multilateral regimes could be achieved if the United States were to demonstrate a greater commitment to work cooperatively with other countries to reduce WMD. The Department of Commerce will review the assertions made by the commentator. A detailed review of all comments received can be found in Appendix I.
Recognizing that multilateral coordination of export controls and enforcement actions is the most effective means of restricting proliferation activities, the U.S. Government coordinates its controls on biological items with other countries in the AG.
The U.S. Government continues to address the problem of biological weapons proliferation through a variety of international fora and urges other AG members to pursue export control cooperation with non-members on a bilateral or regional basis.
The U.S. Government continues to address the problem of biological weapons proliferation on a number of fronts. Direct negotiations with countries intent on acquiring biological weapons are not likely to prevent the use of U.S.-origin materials for such activities; neither are such negotiations likely to affect the behavior of these countries.
Alternative means to curtail the acquisition and development of biological warfare capabilities, such as diplomatic negotiations, do not obviate the need for controls. The following examples demonstrate additional means that have been, and will continue to be, used in an attempt to curb the use and spread of biological weapons:
Regulations issued by the Public Health Service (42 CFR Part 72) pursuant to “The Antiterrorism and Effective Death Penalty Act of 1996” (Sec. 511 of Pub. L.104-132, April 24, 1996, 110 Stat. 1214) place additional shipping and handling requirements on laboratory facilities that transfer or receive select infectious agents capable of causing substantial harm to human health.
The Chemical and Biological Weapons Control and Warfare Elimination Act of 1991 (Pub. L.102-182, Title III, December 4, 1991, 105 Stat. 1245) provides for the imposition of sanctions on foreign persons or countries for certain kinds of chemical and biological weapons-related activity. To date, no sanctions have been imposed for biological weapons-related activities.
The negotiations and alternative means undertaken by the U.S. Government demonstrate that we have made reasonable efforts to achieve the purposes of the controls, but these actions have not had the results that are as effective as the maintenance and renewal of the controls.
Most of the AG-controlled biological agents, and related equipment to produce them, are available from many sources. (Biological agents are, in fact, endemic.) Notwithstanding the difficulties related to the effective control of these items, the United States and its AG partners consider it necessary to maintain controls in order to stem shipments to potential proliferators. Foreign availability is a factor considered by the AG member countries in their coordination of controls.
14 Chapter 6 of this report addresses U.S. chemical controls.
15 The Convention on the Prohibition of the Development, Production and Stockpiling of Bacteriological (Biological) and Toxin Weapons and on Their Destruction (BWC) was signed in 1972 and ratified by the United States in 1975.
16 As of December 2004, the countries in Country Group D:3 included Afghanistan, Armenia, Azerbaijan, Bahrain, Belarus, Burma, China (PRC), Cuba, Egypt, Georgia, India, Iran, Iraq, Israel, Jordan, Kazakhstan, North Korea, Kuwait, Kyrgyzstan, Lebanon, Libya, Macau, Moldova, Mongolia, Oman, Pakistan, Qatar, Russia, Saudi Arabia, Syria, Taiwan, Tajikistan, Turkmenistan, Ukraine, the United Arab Emirates, Uzbekistan, Vietnam, and Yemen.
