Commerce Tidies Up the Russia/Belarus Export Controls and Adds Aircraft and Drones (HTS Ch 88) to Its License Requirements

The purported purpose of the Rule is to expand the scope of existing Russia, Belarus, and Iran sanctions in order to further weaken the Russian and Belarusian industrial bases, and to align controls with those imposed by US allies and partners. It does that, but also performs a welcome clean up to the various odds and ends, namely Part 746 provisions and supplements that impose license requirements on exports and reexports to Russia and Belarus.

What does the Rule do?

1. Addition of 94 additional Harmonized Tariff Schedule (HTS)-6 Code entries – including many in HTS Chapter 88 such as helicopters, airplanes, and unmanned aircraft of various sizes — to Supplement No. 4 to Part 746 that require a license for export, reexport to, or transfer within Russia or Belarus. This affects only EAR99 items, as ECCN 9A991 aircraft subject to the EAR already require a license for export/reexport/transfer to/within Russia and Belarus.
2. Addition of new EAR99 HTS-6 Code entry, 852910 Antennas and antenna reflectors, and parts thereof, to Supplement No. 7 to Part 746, which will now require a license for export or reexport to Russia, Belarus, or Iran, and be subject to the Iran Foreign Direct Product Rule.
3. Prohibition of the use of de minimis for .y “600 series” and 9x515 items for Russia and Belarus.
4. Corrections and clarifications to existing controls on Russia and Belarus.

New HTS Entries Requiring Licenses for Russia, Belarus, and Iran – Think Aircraft and UAVs in Chapter 88

The Rule adds 94 new entries in HTS Chapter 88 (aircraft, spacecraft, and parts thereof) to Supplement No. 4 that now require a license to Russia and Belarus. These entries include various industrial materials, items for manufacturing, and certain aircraft-related items. Previously, in May 2023, BIS had imposed controls on entire HTS Chapters 84, 85, and 90, and with the addition of 88, BIS is aiming to better align with allies’ aviation controls on Russia. While many of these items fell into export control classification numbers (ECCNs) on the Commerce Control List (CCL) and already required a license, some, such as certain UAVs, are classified as EAR99 and did not require a license previously. 

Additionally, the Rule adds HTS entry 852910 (certain antennas and antenna reflectors and parts thereof) to Supplement No. 7 that will now require a license for export or reexport to Iran under 15 CFR § 746.7(a)(1)(ii) and to Russia and Belarus under § 746.8(a)(2). This action is intended to further undermine Iran’s ability to support Russia’s military aggression in Ukraine. These antennas will also be subject to the Iran FDPR in Part 734.9.

The list of Chapter 88 entries which now require a license to Russia and Belarus can be found here.

Removing De minimis US Content for Certain “600 series” and 9x515 Items Destined to Belarus and Russia

The Rule modifies de minimis US content calculations in § 734.4 by eliminating de minimis levels for US-origin 9x515 or “600 series” .y items destined for Russia and Belarus. The aim is to extend control over foreign made low-level military and spacecraft items, increase pressure on Russia’s military and defense industrial base, and make it challenging for foreign suppliers to provide such items to Belarus and Russia.

Corrections and Clarifications to Existing Russia/Belarus Regulations

In addition to the above changes, the Rule makes corrections and provides clarifications to the existing Russia and Belarus controls under the EAR. The revisions include:

• Exclusion from license requirements for exports, reexports, and transfers (in-country) related to deployments by the Armed Forces of Ukraine to or within the temporarily occupied Crimea region and covered regions of Ukraine under § 746.6.
• Clarification that U.S.-origin luxury goods items listed in Supplement No. 5 are excluded from de minimis calculations for exports from Supplement No. 3 allied countries, aligning with similar exclusions found in §§ 746.5 and 746.8. This is a particularly welcome change as it means those of us conducting de minimis calculations no longer have to check and double-check for Supplement 5 luxury goods – equal treatment for all the supplements!
• Revisions to introductory text in §§ 746.5, 746.8, and 746.10 to establish an order of review for Russia and Belarus license requirements, license exceptions, and review policies for items controlled both under the CCL and identified in one of the supplements to part 746. This one is truly for the export control nerds!
• Confirmation of the exclusion of fasteners (e.g., screws, bolts, nuts, nut plates, studs, inserts, clips, rivets, pins, washers, spacers, insulators, grommets, bushings, springs, wires, and solders) from the scope of Supplements No. 2, 4, 5, and 7, for purposes of licensing to Russia and Belarus. Why? Because they apparently are not “modified or designed” for the listed HTS categories even though BIS did not use the magic words “specially designed,” which would have excluded fasteners from the get-go. However, restrictions under § 744.21 (military end-uses /end-users) and other restrictions in Part 744 that extend to all items subject to the EAR still apply.
• Harmonization of license exceptions under §§ 746.5, 746.8, and 746.10 to establish a common set of license exceptions for controls related to Russia and Belarus. Again, this is a welcome correction from BIS.
• Exclusion of “medicines” from the scope of Supplement No. 6.
• Adoption of a case-by-case license review policy for applications related to the safety of flight under §§ 746.5 and 746.10. 
• Clarification that restrictions on temporarily imported firearms from Ukraine do not apply to items previously exported, reexported, or transferred under a BIS license, temporarily returned to the United States for repair and servicing.