International Trade Law News

Published by Jacobson Burton Kelley PLLC

The Commerce Department's Bureau of Industry and Security (BIS) today published in the Federal Register a proposed rule that would amend section 742.5 the Export Administration Regulations (EAR) by imposing a license requirement for exports and reexports of items controlled for missile technology (MT) reasons to Canada. To date, the EAR have required a license for MT-controlled items to all destinations except Canada.

Today's proposed rule comes more than three years after BIS published an advanced notice of proposed rulemaking (ANPR) seeking comments on the removal of the Canadian exemption for MT items. BIS received seventeen comments in response to its 2001 ANPR from Canadian and U.S.-based trade associations, Canadian and U.S.-based companies, a foreign airline and the Government of Canada. Not surprisingly, all of the comments were opposed to the implementation of a licensing requirement for MT items to Canada. Most of the comments stated that imposing a license requirement on MT-controlled items would have an adverse impact on U.S.-Canada trade by forcing Canadian companies to seek business relationships and equipment sources outside of the U.S.

Although the comments received in response to the ANPR were opposed to the license requirement, BIS is now requesting more specific comments as to the effect that the rule will have in terms of numbers of license applications that the industry and/or individual companies would expect to submit under such a requirement. BIS is also seeking specific information on the estimated additional costs of complying with the licensing requirement for exports and reexports of MT-controlled items to Canada.. The deadline for submitting comments to BIS on the proposed rule is June 23, 2005.

The proposed rule can be found at the following link:
a257.g.akamaitech.net/7/257/2422/01jan20051800/
edocket.access.gpo.gov/2005/05-10356.htm