Commerce provides opportunity for business input to export controls - Department of Commerce's Office of Foreign Availability

Business America, Jan 20, 1986 by Teresa J. Taylor

Through the newly created Office of Foreign Availability within the Department of Commer, U.S. exporters now have a direct avenue for submitting evidence of foreign availability, which if proven positive, could lead to decontrol of a commodity or technical data. Foreign availability exists for a national security controlled item when a non-U.S. origin item of comparable quality is available to proscribed countries. The availability must be in quantities sufficient to satisfy the proscribed countries' military needs so that U.S. exports of the item would not significantly contribute to their military potential. To determine comparability, OFA considers the similarity of the non-U.S. technical item or data to their U.S. counterparts in function, end use, end product, technological approach, performance thresholds, maintainability, and service life.

Mandated by Congress in the 1979 Export Administration Act to create a foreign availability program, the Commerce Department established the Foreign Availability Division in 1983, which was recently upgraded to the Office of Foreign Availability (OFA). The program is designed to directly involve the business community in determining appropriate control levels and to reduce the Commerce Department's licensing caseload in low-end, high-volume products through selective decontrol.

Claim Processing

Although the majority of foreign availability studies are initiated by requests of U.S. firms or Department of Commerce Technical Advisory Committees (TACs), OFA also launches studies in areas where national security and foreign policy export controls may no longer be effective because of foreign availability. The 1985 Amendments require OFA to initiate studies regarding proposed controls. These efforts, which could lead to decontrol, are coordinated with the Departments of State and Defense and the intelligence community.

The 1985 Amendments increased the role the TACs play in supporting the foreign availability program. Members are appointed from industry and government to advise the Commerce Department on technical issues relating to export control. The nine existing TACs, each covering a major technical area, have statutory authority to certify foreign availability. Under the Amendments, OFA has 90 days to process a foreign availability assessment submitted by a TAC. This is the only statutory deadline imposed on assessing foreign availability.

Any person or organization can submit a foreign availability claim for either a validated license approval or decontrol of a commodity. Proposed regulations for conducting assessments for national security controls were published in March 1985. Based on 22 comments received from interested industry and congressional parties, some modifications were made to the regulations, which were published in final form on Dec. 27, 1985.

A claim may be submitted when a license application or a request for re-export authorization is filed, or up to 90 days after denial of a license application. After denial of a license, an assessment is initiated upon receipt of the submission, provided the commodity or technical data fall under the jurisdiction of the Export Administration Act. If a complete foreign availability claim has been submitted prior to denial of the license, the applicant will be notified at the time of the license denial that an assessment of foreign availability has been initiated.

Supporting data submitted with a license application are treated confidentially, and when specifically requested, the same holds true for data submitted with a decontrol initiative.

Although there is no mandatory deadline for completing a study initiated as part of a license application, IFA has set a goal of 90 days. If a positive determination is made, either the validated license will be forwarded to the applicant or the license will be denied if license approval would threaten national security. If a negative determination is made, a notice will be sent to the applicant with the reasons for its denial. The applicant has the right to appeal the determination within 45 days. For claims requesting decontrol of an item based on foreign availability, an assessment will be initiated after OFA determines that the submission meets the regulatory requirements for the submission data. Results of a positive or negative determination are published in the Federal Register within 30 days of completion of an assessment.

Neither license approval nor decontrol may occur immediately, despite the proven existence of foreign availability, if it is determined that such actions would harm national security. In the case of decontrol actions, however, the government must take steps to eliminate the foreign availability thrugh negotiations. If such negotiations are unsuccessful, decontrol will occur not more than 18 months after the original finding. This 18-month negotiation period must commence with a "National Security Override," which is imposed by the President when foreign availability is evident but immediate decontrol might harm national security. The law provides for an initial six-month period for negotiations with the source of foreign-availability. In the event that this six-month period expires and the President certifies to Congress that negotiations are progressing but there is continued threat to national security, an additional 12 months is available for continued negotiations. After 18 months, however, if the negotiations are unsuccessful, decontrol is effected by law.