President
White House Issues Fact Sheet on the Export Control Reform Initiative
04/20/10 11:32 PM
On
April 20, 2010, the White House issued a fact sheet
on President Obama’s Export Control Reform
initiative. The initiative started in August 2009
with a comprehensive assessment of the U.S. export
control system to identify possible reforms.
The assessment, created at the direction of the President, was conducted by an interagency task force that included all departments and agencies with roles in export controls. The assessment found that the current U.S. export control system does not sufficiently reduce national security risk based on the fact that its structure is “overly complicated, contains too many redundancies, and tries to protect too much.”
Based on the review, the Administration has determined that fundamental reform of the U.S. export control system is needed in each of its four component areas, with transformation to a:
For the implementation of the proposed reforms, the Administration has prepared a comprehensive, three-phase approach and is currently moving forward to make specific reforms which can be initiated immediately and implemented without legislation:
Phase I makes significant and immediate improvements to the existing system and establishes the framework necessary to create the new system, including making preparations for any legislative proposals. This phase includes implementing specific reform actions already in process and initiating review of new ones.
Phase II results in a fundamentally new U.S. export control system based on the current structure later this year. This phase completes deployment of specific Phase I reforms and initiates new actions contingent upon completion of Phase I items. Congressional notification will be required to remove munitions list controls or transfer items from the munitions list to the dual-use list, and additional funding will be required both for enhanced enforcement and the IT infrastructure.
Phase III completes the transition to the new U.S. export control system. Legislation would be required for this phase:
The assessment, created at the direction of the President, was conducted by an interagency task force that included all departments and agencies with roles in export controls. The assessment found that the current U.S. export control system does not sufficiently reduce national security risk based on the fact that its structure is “overly complicated, contains too many redundancies, and tries to protect too much.”
Based on the review, the Administration has determined that fundamental reform of the U.S. export control system is needed in each of its four component areas, with transformation to a:
- Single Control
List,
• Single Primary Enforcement Coordination Agency,
• Single IT System, and
• Single Licensing Agency.
For the implementation of the proposed reforms, the Administration has prepared a comprehensive, three-phase approach and is currently moving forward to make specific reforms which can be initiated immediately and implemented without legislation:
Phase I makes significant and immediate improvements to the existing system and establishes the framework necessary to create the new system, including making preparations for any legislative proposals. This phase includes implementing specific reform actions already in process and initiating review of new ones.
-
Control List – refine,
understand, and harmonize definitions to end
jurisdiction confusion between the two lists;
establish new independent control criteria to be
used to screen items for control into new tiered
control list structure.
• Licensing – implement regulatory-based improvements to streamline licensing processes and standardize policy and processes to increase efficiencies.
• Enforcement – synchronize and de-conflict enforcement by creation of an Enforcement Fusion Center.
• IT – determine enterprise-wide needs and begin the process to reduce confusion by creating a single U.S. Government (USG) point of entry for exporters.
Phase II results in a fundamentally new U.S. export control system based on the current structure later this year. This phase completes deployment of specific Phase I reforms and initiates new actions contingent upon completion of Phase I items. Congressional notification will be required to remove munitions list controls or transfer items from the munitions list to the dual-use list, and additional funding will be required both for enhanced enforcement and the IT infrastructure.
-
Control List – restructure
the two lists into identical tiered structures,
apply criteria, remove unilateral controls as
appropriate, and submit proposals multilaterally
to add or remove controls.
• Licensing – complete transition to mirrored control list system and fully implement licensing harmonization to allow export authorizations within each control tier to achieve a significant license requirement reduction which is compatible with national security equities.
• Enforcement – expand outreach and compliance.
• IT – transition toward a single electronic licensing system.
Phase III completes the transition to the new U.S. export control system. Legislation would be required for this phase:
-
Control List – merge the two
lists into a single list, and implement
systematic process to keep current.
• Licensing – implement single licensing agency.
• Enforcement – consolidate certain enforcement activities into a Primary Enforcement Coordination Agency.
• IT – implement a single, enterprise-wide IT system (both licensing and enforcement).
President Obama Signs Executive Order on National Export Initiative
03/11/10 05:38 PM
On
March 11, 2010, President Obama signed an
executive order
launching a
single, comprehensive strategy to promote
American exports called National Export
Initiative (NEI). That same day, President
Obama spoke about NEI at
the Export-Import Bank’s (Ex-Im) Annual
Conference in Washington, DC.
In the executive order, Obama states that the NEI will help meet his Administration’s goal of doubling exports over the next 5 years by working to remove trade barriers abroad, by helping firms to overcome obstacles to enter new export markets, by increasing trade financing, and by pursuing a general, Government-wide approach to promote U.S. exports abroad.
Particular focus of NEI will fall on the following areas:
a) Exports by small and medium-sized corporations (SMEs). EPC members will develop programs designed to enhance export assistance to SMEs, including developing programs to improve technical assistance to first-time exporters and assisting current exporters in identifying new export opportunities in international markets;
b) Federal Export Assistance. Members of the EPC will promote Federal resources currently available to assist U.S. exports;
c) Trade Missions and Commercial Advocacy. U.S. Government-led trade missions will effectively promote exports by U.S. companies;
d) Increasing Trade Financing. The President of Ex-Im will work on increasing the availability of credits to SMEs. In his speech, the President noted that in 2009, Ex-Im authorized $21 billion in loans in support of U.S. exports, almost a 50% increase from the previous year. Under the NEI, the amount of trade financing available to SMEs is expected to increase further;
e) Macroeconomic Rebalancing. A balanced and strong growth in the global economy will be promoted through the G20 or other appropriate mechanisms;
f) Reducing Barriers to Trade. The U.S. Trade Representative together with members of EPC will take steps to improve market access overseas for U.S. manufacturers, farmers, and service providers. To ensure that that U.S. companies have free and fair access to the overseas markets, in his speech at Ex-Im President Obama called for enforcement of trade agreements that U.S. already has on books; and
g) Export Promotion of Services. Pursuant to NEI, a framework for promoting services trade, including the necessary policy and export promotion tools, will be developed.
President Obama also stated that one of the major goals of NEI is aggressive protection of intellectual property in the U.S., achieved by negotiating proper protections with foreign countries and enforcing existing U.S. agreements overseas.
With regard to export controls, President Obama stated:
Finally, we’re working to reform our Export Control System for our strategic, high-tech industries, which will strengthen our national security. What we want to do is concentrate our efforts on enforcing controls on the export of our most critical technologies, making America safer while enhancing the competitiveness of key American industries. We’ve conducted a broad review of the Export Control System, and Secretary Gates will outline our reform proposal within the next couple of weeks. But today, I’d like to announce two steps that we’re prepared to take.
First, we’re going to streamline the process certain companies need to go through to get their products to market -– products with encryption capabilities like cell phone and network storage devices. Right now, they endure a technical review that can take between 30 and 60 days, and that puts that company at a distinct disadvantage to foreign competitors who don’t face those same delays. So a new one-time online process will shorten that review time from 30 days to 30 minutes, and that makes it quicker and easier for our businesses to compete while meeting our national security requirements.
And second, we’re going to eliminate unnecessary obstacles for exporting products to companies with dual-national and third-country-national employees. Currently, our exporters and foreign consumers of these goods have to comply with two different, conflicting set of standards. They’re running on two tracks, when they could be running just on one. So we’re moving towards harmonizing those standards and making it easier for American and foreign companies to comply with our requirements without diminishing our security. And I look forward to consulting with Congress on these reforms, as well as broader export control reform efforts.
In the executive order, Obama states that the NEI will help meet his Administration’s goal of doubling exports over the next 5 years by working to remove trade barriers abroad, by helping firms to overcome obstacles to enter new export markets, by increasing trade financing, and by pursuing a general, Government-wide approach to promote U.S. exports abroad.
Particular focus of NEI will fall on the following areas:
a) Exports by small and medium-sized corporations (SMEs). EPC members will develop programs designed to enhance export assistance to SMEs, including developing programs to improve technical assistance to first-time exporters and assisting current exporters in identifying new export opportunities in international markets;
b) Federal Export Assistance. Members of the EPC will promote Federal resources currently available to assist U.S. exports;
c) Trade Missions and Commercial Advocacy. U.S. Government-led trade missions will effectively promote exports by U.S. companies;
d) Increasing Trade Financing. The President of Ex-Im will work on increasing the availability of credits to SMEs. In his speech, the President noted that in 2009, Ex-Im authorized $21 billion in loans in support of U.S. exports, almost a 50% increase from the previous year. Under the NEI, the amount of trade financing available to SMEs is expected to increase further;
e) Macroeconomic Rebalancing. A balanced and strong growth in the global economy will be promoted through the G20 or other appropriate mechanisms;
f) Reducing Barriers to Trade. The U.S. Trade Representative together with members of EPC will take steps to improve market access overseas for U.S. manufacturers, farmers, and service providers. To ensure that that U.S. companies have free and fair access to the overseas markets, in his speech at Ex-Im President Obama called for enforcement of trade agreements that U.S. already has on books; and
g) Export Promotion of Services. Pursuant to NEI, a framework for promoting services trade, including the necessary policy and export promotion tools, will be developed.
President Obama also stated that one of the major goals of NEI is aggressive protection of intellectual property in the U.S., achieved by negotiating proper protections with foreign countries and enforcing existing U.S. agreements overseas.
With regard to export controls, President Obama stated:
Finally, we’re working to reform our Export Control System for our strategic, high-tech industries, which will strengthen our national security. What we want to do is concentrate our efforts on enforcing controls on the export of our most critical technologies, making America safer while enhancing the competitiveness of key American industries. We’ve conducted a broad review of the Export Control System, and Secretary Gates will outline our reform proposal within the next couple of weeks. But today, I’d like to announce two steps that we’re prepared to take.
First, we’re going to streamline the process certain companies need to go through to get their products to market -– products with encryption capabilities like cell phone and network storage devices. Right now, they endure a technical review that can take between 30 and 60 days, and that puts that company at a distinct disadvantage to foreign competitors who don’t face those same delays. So a new one-time online process will shorten that review time from 30 days to 30 minutes, and that makes it quicker and easier for our businesses to compete while meeting our national security requirements.
And second, we’re going to eliminate unnecessary obstacles for exporting products to companies with dual-national and third-country-national employees. Currently, our exporters and foreign consumers of these goods have to comply with two different, conflicting set of standards. They’re running on two tracks, when they could be running just on one. So we’re moving towards harmonizing those standards and making it easier for American and foreign companies to comply with our requirements without diminishing our security. And I look forward to consulting with Congress on these reforms, as well as broader export control reform efforts.
President Changes North Korea's Designations
07/02/08 03:11 PM
On
June 26, 2008, President Bush announced the lifting
of the application of the Trading with the Enemy
Act (TWEA) with respect to the Democratic People's
Republic of Korea (DPRK or North Korea), and
notified Congress of his intent to rescind North
Korea's designation as a State Sponsor of Terrorism
(SST), which triggers a 45-day congressional
notification period prior to formal rescission of
the designation. The Executive Order can be
found here and the State
Department's press release can be found
here.
This presidential action was taken following North Korea's submission of a declaration of its nuclear programs, which will now be subject to verification, by the Six Parties. The Six Party talks has been a series of meetings with six party states: the People's Republic of China, the Republic of Korea (South Korea), North Korea, the United States, the Russian Federation, and Japan, which were the result of North Korea's withdrawal from the Nuclear Non-Proliferation Treaty in 2003.
The Administration plans to carry out North Korea's rescission from the SST list only after the Six Parties reach agreement on acceptable verification principles and acceptable verification protocol regarding North Korea's nuclear activities; the Six Parties have established an acceptable monitoring mechanism; and verification activities have begun.
This presidential action was taken following North Korea's submission of a declaration of its nuclear programs, which will now be subject to verification, by the Six Parties. The Six Party talks has been a series of meetings with six party states: the People's Republic of China, the Republic of Korea (South Korea), North Korea, the United States, the Russian Federation, and Japan, which were the result of North Korea's withdrawal from the Nuclear Non-Proliferation Treaty in 2003.
The Administration plans to carry out North Korea's rescission from the SST list only after the Six Parties reach agreement on acceptable verification principles and acceptable verification protocol regarding North Korea's nuclear activities; the Six Parties have established an acceptable monitoring mechanism; and verification activities have begun.