U.S. Export Control Reform: Permanent Import Controls and the DOJ

As part of the U.S. Government’s Export Control Reform Initiative, the Justice Department’s U.S. Munitions Import List (“USMIL”) has been “delinked” from the State Department’s U.S. Munitions List (“USML”). On April 22, 2013, the DOJ’s Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”) issued a final rule that distinguishes defense articles and services controlled by the Attorney General from those controlled by the Secretary of State. Before this rule, the USMIL adopted most of the items controlled under the ITAR. This means that items controlled by the USMIL will not be affected by the transfer of items from the USML to the Commerce Control List (“CCL”).

The ATF rule was effective on publication, and amends the USMIL to do the following:

1. Removes the language adopting the State Department’s USML;
2. Clarifies that the Attorney General has the authority (under the Arms Export Control Act or “AECA”) to designate defense articles and defense services for inclusion on the USML for purposes of permanent import controls, regardless of whether the State Department controls them for export or temporary import; and
3. Clarifies that items controlled by the Attorney General under the AECA authority appear on the USMIL, and that the USMIL is a subset of the USML.

This rule does not change the content of the USMIL, and any revisions to the USMIL will be addressed by the Attorney General in a separate rulemaking.

Companies seeking to permanently import defense articles and services should therefore be mindful that the move of items from the USML to the CCL may nevertheless be subject to USMIL controls. The USMIL currently controls firearms, artillery, ammunition, vessels of war, and aircraft, just to name a few broad areas of regulation. The reforms to aircraft and gas turbine engines become effective on October 15, 2013, so it raises a question about the degree to which these items are still governed by the USMIL. The same issue applies to vessels of war, tanks, auxiliary military equipment, and submersibles, which will move from the USML to the CCL on January 6, 2014.