The Obama Administration’s proposal to adopt export control reform is slowly moving ahead. Under the proposed reform, DDTC will adopt revisions to the U.S. Munitions List (USML) and transfer certain USML items to a newly established 600 Series on the Commerce Control List (“CCL”) under the Export Administration Regulations (“EAR”). Both DDTC and BIS have recently promulgated a series of proposed regulations that set forth amendments to ITAR and EAR that are required to implement the reform. These include further draft revisions to numerous categories of the USML, including Category X (Personal Protective Equipment and Shelters), Category V (Explosives and Energetic Materials), Category IX (Military Training Equipment) and Category XIII (Materials and Miscellaneous Articles). (See links to the proposed regulations below.) In addition, the agencies have issued a number of proposed regulations that would facilitate the implementation of the reform amendments, including a proposed definition of the term “Specially Designed” as used in the revised USML and CCL, and a draft transition rule. The agencies are currently seeking public comments on these proposals.

The next steps in the process are for DDTC and BIS to issue draft revisions for the remaining USML Categories and request public comments, provide notice to Congress under Section 38(f) of the Arms Export Control Act, obtain legislative authority for the transfer of satellite products from the USML to the CCL, and issue all of the implementing regulations in final form. In recent public announcements, BIS officials have stated that they intend to issue the remaining draft USML Categories in late summer/fall and submit the 38(f) notification to Congress later in the fall.

Administration officials originally were aiming for the reform effort to be completed prior to the end of the year. However, they have recently changed this estimate to some time during 2013. This date could slip even further based upon comments received from industry, reaction from Congress upon receipt of the 38(f) notification and the outcome of the presidential election. While significant progress has been made toward adopting the reforms, there is no certainty that the proposals will eventually be finalized, or adopted in a form similar to the terms in the current proposals. We will keep readers advised on the progress of the reform effort in the upcoming months. A list of recent proposed regulations related to the reform effort is set forth under “Other Export Control Developments”.