Libya Licensing

1
Libya Licensing
Presented By Bureau of Industry and Security U.
S. Department of Commerce
2
Overview

• Background
• August 31, 2006 Regulation
• Moving Forward

3
Libya Background

• In August 2003, Libya satisfied the United
  Nations Security Council (UNSC) requirements
  related to the 1988 bombing of Pan Am Flight 103
  over Scotland.
• In September 2003, the UNSC issued Resolution
  1506 which lifted the already suspended UN
  embargo on Libya.
  
• In December 2003, Libya announced that it would
  end its WMD programs.
  
• In recognition of the steps Libya had taken with
  regard to its weapons program and support of
  terrorism, in April 2004, the President
  terminated the application of the Iran-Libya
  Sanctions Act with respect to Libya.
• The Presidents action allowed the resumption of
  most commercial activities with Libya.
  

4
Libya Background 2

• On April 29, 2004, BIS published a regulation
  returning licensing jurisdiction for Libya to
  BIS.
  
• On March 22, 2005, BIS published a second
  regulation on Libya that dealt with the
  installed base issue (General Prohibition 10 in
  736.2 of the EAR).
• The March 2005 regulation allows exporters to
  overcome the prohibition against dealing with
  installed base.

5
Libya Background 3

• On May 15, 2006 the Secretary of State announced
  the Administrations intent to rescind Libyas
  designation as a state sponsor of terrorism.
  
• This decision became effective on June 30, 2006
  following a mandated 45-day Congressional
  notification period.
  
• Following the May announcement, all relevant
  agencies engaged in discussions on what the new
  export control regime for Libya should be in
  light of the Secretary of States action. The
  new regulation is a result of those negotiations.

6
Libya The August 31, 2006 Regulation

• The regulation removes the licensing requirement
  for all items controlled for AT reasons only.
  
• Libya is removed from Country Group E1 and moved
  into Country Group D1. It remains in Country
  Groups D2, D3, and D4.
  
• This makes Libya eligible, in whole or in part,
  for these License Exceptions CIV, APP, TMP,
  RPL, GOV, TSU, BAG, AVS, APR, ENC and KMI.

7
New Licensing Requirements Review Policy

• Items controlled for multilateral reasons
  chemical/biological (CB), nuclear
  non-proliferation (NP), national security (NS),
  and missile technology (MT), still require a
  license for export or reexport to Libya.
• Items controlled unilaterally for regional
  stability (RS) and crime control (CC) reasons
  also still require licenses for export or
  reexport to Libya.
• Applications for these items are reviewed on a
  case-by-case basis consistent with the relevant
  sections in Part 742.

8
Treatment of Installed Base

• Although installed base is a universal issue,
  there are procedures that are unique to Libya.
  
• Libya was under a comprehensive embargo from
  January 1986 through April 2004. During that
  time many U.S.-origin items were illegally
  shipped to Libya and are considered installed
  base.
• Restrictions on exports of dual-use items to
  Libya began in 1979, so it is possible that there
  are items shipped prior to January 1986 which
  would also be installed base.

9
Treatment of Installed Base

• It is a violation of the EAR under Section
  764.2(e) and General Prohibition 10 to interact
  with installed base items.
  
• In March 2005, BIS published a regulation that
  allows exporters to overcome this prohibition in
  Libya. This was added as Section 764.7 in the
  EAR.
• This procedure remains in the regulations and the
  August 31, 2006 regulation does not affect it.

10
Treatment of Installed Base

• Per Section 764.7 of the EAR, exporters can
  overcome the prohibition on interacting with
  installed base items through
  
• A report (for items controlled on the Wassenaar
  Basic List or below) or
  
• A license (for items controlled on the Wassenaar
  Sensitive or Very Sensitive Lists or other
  control regimes).

11
Treatment of Installed Base

• The reports are submitted to the Office of Export
  Enforcement.
  
• Section 764.7 only applies to installed base
  items exported illegally prior to April 29, 2004.
  Any item exported illegally after that date must
  be handled like an illegal export to any other
  destination.

12
Moving Forward

• What will BIS licensing volume be for Libya?
• The answer is that it is difficult to say.
• From January 2005-July 2006, 98 of all licenses
  granted for Libya were for AT-only items (4.51
  of 4.6 billion). Applications for these items
  will all go away.
• In addition, some of the regime-controlled items
  exported to Libya will now be eligible for
  License Exceptions.
  
• However, it is possible that more U.S. companies
  will seek to do business in Libya now that it is
  no longer terrorist-designated resulting in more
  licenses for regime-controlled items.

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Contact Information http//www.bis.doc.gov

• U.S. Embassy Tripoli Commercial Section
• http//tripoli.usmission.gov
• tripoliecon_at_state.gov
• 218-21-335-1846
• BIS Office of Exporter Services
• [phone]
• For general information and assistance
• http//www.bis.doc.gov/seminarsandtraining/index.h
  tm
  
• BIS/NPTC/FP
• [phone]
• For information on BISs foreign policy controls