New Pakistan-Related Export Controls to Address Entity List Diversion, BIS Says
The Bureau of Industry and Security soon will place new export controls over certain scientific testing and industrial processing equipment destined to Pakistan that had not previously faced license requirements, saying the items have been diverted through Pakistan to companies on the Entity List.
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A final rule, largely effective Dec. 26, will place new licensing requirements on exports, reexports and in-country transfers to and within Pakistan for shipments involving particle accelerators; certain pipes, valves, pumps and welders; oscilloscopes, chromatographs and spectrometers; and magnetometers, BIS said. Exporters will need a license for “regional stability reasons” to move those items and others to or within Pakistan, and those items fall under Export Control Classification Numbers 1B999, 2A992, 2B999, 3A992, 3A999 and 6A996.
Export license exceptions for these ECCNs when destined to Pakistan “will be limited,” BIS said, and license applications will be reviewed case by case as BIS and other government agencies decide whether the proposed shipment “presents an unacceptable risk of use in, or diversion to, an end use or end user of concern.” If the U.S. decides there’s an unacceptable risk, the application will be denied, BIS said.
BIS Undersecretary Alan Estevez said the controls will “strengthen our national security by making it harder for entities of concern in Pakistan to procure these items from the United States,” while Thea Kendler, the assistant secretary for export administration, said the controls target “key dual-use items” that can be used in ways “that are contrary to U.S. national security or foreign policy.”
The new controls mostly address “diversion concerns” BIS said it has with Pakistan, adding that the items are sought by entities on the Entity List as well as their front companies. It said there are currently 162 Entity Listed parties in Pakistan.
“Controlling such items on a countrywide basis will allow the U.S. government to review proposed transactions to mitigate the risk of diversion to an end use or end user of concern, while facilitating trade for legitimate commercial and civil end uses,” the agency said.
Although the items are already subject to some licensing rules, BIS said its changes will address that some items are controlled only for antiterrorism-reasons, and so they’re not currently subject to a license requirement for export, reexport or transfer within Pakistan. BIS said entities on the Entity List have used Pakistan to buy specific processing equipment, stainless steel or alloy pipes and valves, certain electronic equipment, superconductive electromagnetic sensors and their specially designed components, and more items captured by the ECCNs listed in the rule.
The agency also said some of the items have also been controlled for nuclear nonproliferation reasons, but it said more BIS scrutiny on those exports to Pakistan will “advance U.S. national security and foreign policy interests by reducing the risk of diversion to unauthorized end uses and/or end users.” It encouraged exporters and other companies shipping these items to review its Pakistan-related best practices guidance for conducting due diligence.
All exports that now require a license as a result of this rule, or that now are subject to electronic export filing requirements, but were aboard a carrier to a port as of Dec. 26, may proceed to their destinations under the previous eligibility, unless an export filing “is otherwise required by law or regulation independent of this action.”