Draft Export Control Reform Rule Will Close China Diversion Opportunities

摘要

The administration has tightened a proposed framework for controlling less-significant military items moved off the United States Munitions List (USML) to the less-stringent Commerce Control List (CCL) in two major ways meant to guard against diversion to China and other U.S. arms-embargoed countries, according to a June 20 proposed transition rule. First, the new proposed "transition rule" eliminates a de minimis provision that that would have allowed an item containing a certain amount of former USML components now on the CCL to be shipped from a foreign country to a country subject to a U.S. arms embargo without a U.S. reexport license. This change is meant to ensure that these countries cannot receive any items containing former USML components from companies in foreign countries.