Military-intelligence end users and sanctioned parties

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1. The military-intelligence rule

The Export Administration Regulations (EAR) require a license from the Bureau of Industry and Security (BIS) for any item subject to the EAR in certain military-intelligence cases (15 CFR 744.22(a)). The requirement applies in addition to the license requirements in the Commerce Control List (CCL). It is triggered when the exporter, reexporter or transferor has knowledge that the item is intended, entirely or in part, for a military-intelligence end use or end user in a covered country.

The covered countries are Belarus, Burma, Cambodia, the People’s Republic of China, Russia and Venezuela, and countries in Country Groups E:1 or E:2 (15 CFR 744.22(a)). The rule also reaches military-intelligence end users of those countries wherever located. Military-intelligence end users located outside those countries are limited to the organizations the rule names.

2. Notice from BIS

BIS may inform a party that a license is required for specific transactions, because of an unacceptable risk of use in, or diversion to, a covered military-intelligence end use or end user (15 CFR 744.22(b)). It may do so by specific notice, by amending the EAR in the Federal Register, or by a separate notification in the Federal Register. The rule applies to any item subject to the EAR, not only listed items.

3. Exception, application and review

Items may still be exported, reexported or transferred under License Exception GOV as set out in section 740.11(b)(2)(ii) (15 CFR 744.22(c)). That provision covers items made by or consigned to a U.S. Government department or agency solely for its official use (15 CFR 740.11(b)(2)(ii)). It also covers items for a government program with foreign governments or international organizations that is authorized by law and subject to control by the President by other means.

Contractor support personnel are eligible when performing their contract duties within a U.S. Government owned or operated facility, or under the direct supervision of a U.S. Government employee (15 CFR 740.11(b)(2)(ii)). The rule states that private security contractors are not contractor support personnel for this purpose, because they do not provide administrative, managerial, scientific or technical support under contract.

An application under the rule must state in the additional information block that it is submitted because of the license requirement in section 744.22 (15 CFR 744.22(d)). It must also include all known information about the military-intelligence end uses or end users, in that block or in an attachment referenced there. Applications are reviewed with a presumption of denial (15 CFR 744.22(e)).

4. What counts as a military-intelligence end use

A military-intelligence end use is defined by activity on certain military items (15 CFR 744.22(f)(1)). It includes development, production, operation, installation, including on-site installation, maintenance (checking), repair, overhaul, refurbishing or incorporation. The items are those on the U.S. Munitions List (USML), or classified under Export Control Classification Numbers (ECCNs) ending in A018 or in the 600 series. They must be intended to support the actions or functions of a military-intelligence end user.

5. Who is a military-intelligence end user

A military-intelligence end user means any intelligence or reconnaissance organization of the armed services, namely the army, navy, marine, air force or coast guard, or of the national guard (15 CFR 744.22(f)(2)). Other government intelligence or reconnaissance organizations of these countries are addressed in section 744.21. For the covered countries, the organizations the rule names are examples and the category is wider. For all other countries, the named list is exhaustive.

The named organizations include Burma’s Office of Chief of Military Security Affairs and Directorate of Signal, and Cambodia’s General Department of Research and Intelligence (15 CFR 744.22(f)(2)(i), 15 CFR 744.22(f)(2)(ii)). They include Cuba’s Directorate of Military Intelligence and Directorate of Military Counterintelligence, and China’s Intelligence Bureau of the Joint Staff Department (15 CFR 744.22(f)(2)(iii), 15 CFR 744.22(f)(2)(iv)).

Also named are Iran’s Islamic Revolutionary Guard Corps Intelligence Organization and Artesh Directorate for Intelligence, and North Korea’s Reconnaissance General Bureau (15 CFR 744.22(f)(2)(v), 15 CFR 744.22(f)(2)(vi)). The list adds Russia’s Main Intelligence Directorate, Syria’s Military Intelligence Service, Venezuela’s General Directorate of Military Counterintelligence and Belarus’s Main Intelligence Directorate of the General Staff (15 CFR 744.22(f)(2)(vii)-(x)).

6. Parties under statutory sanctions

A separate rule sets the licensing policy where a party is under certain statutory sanctions (15 CFR 744.19). It applies notwithstanding any other licensing policy in the EAR. BIS will deny any export or reexport license application if any party to the transaction is subject to one or more of four listed sanctions. The parties covered are the applicant, any other party authorized to receive a license, the purchaser, the intermediate consignee, the ultimate consignee and the end user.

The first is a sanction under the Iran-Iraq Arms Nonproliferation Act of 1992 that prohibits any license to or by the sanctioned person (15 CFR 744.19(a)). The second is a sanction under the Iran, North Korea, and Syria Nonproliferation Act that bars licenses, and requires suspension of existing ones, for transfers of controlled items to foreign persons (15 CFR 744.19(b)).

The third is a sanction under section 11B(b)(1)(B)(ii) of the Export Administration Act of 1979 barring new licenses for exports of controlled items to the sanctioned person (15 CFR 744.19(c)). The fourth is a sanction under the Iran Sanctions Act of 1996 barring any specific license or other specific permission to export goods or technology to the sanctioned person (15 CFR 744.19(e)).

7. The missile technology case

One further sanction is narrower (15 CFR 744.19). Under section 11B(b)(1)(B)(i) of the Export Administration Act of 1979, a sanction may bar new licenses for exports to the sanctioned person of Missile Technology Control Regime (MTCR) Annex equipment or technology (15 CFR 744.19(d)). Where a party is subject to that sanction, BIS will deny applications for CCL items controlled for missile technology (MT) reasons. The general structure of these controls is covered in how EAR end-use and end-user controls work.

Key terms

Military-intelligence end use	Support activity on USML, A018 or 600 series items for a military-intelligence end user.
Military-intelligence end user	An intelligence or reconnaissance organization of the armed services or national guard.
Presumption of denial	The review standard for applications under section 744.22.
Statutory sanction	A sanction under a listed statute that requires denial of certain licenses.
MTCR Annex	The equipment and technology named in the sanction under section 11B(b)(1)(B)(i).

Every statement above links to the document behind it. The full source list for this piece is on the sources page.

This page describes public United States government programs for general information. It is not legal, regulatory or procurement advice, and it does not address the facts of any particular case.

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