Management of Export Control and Nonproliferation Property

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• Management of Export Control and Nonproliferation
  Property

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Why be Concerned?

• The threat to U.S. and global security is the
  proliferation or terrorist acquisition of
  nuclear, chemical, or biological weapons (weapons
  of mass destruction, or WMD).
• Numerous countries are capable of or openly
  striving to acquire WMD.

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Who Needs This?
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What is an Export?

• Any item that is sent from the United States to a
  foreign destination is an export. "Items" include
  commodities, software or technology, such as
  clothing, building materials, circuit boards,
  automotive parts, blue prints, design plans,
  retail software packages and technical
  information.
• How an item is transported outside of the United
  States does not matter in determining export
  license requirements. Regardless of the method
  used for the transfer, the transaction is
  considered an export for export control purposes.
  An item is also considered an export even if it
  is leaving the United States temporarily,

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Export CONTROLS

• Legal and Regulatory Controls
• Laws and regulations
• Control Lists
• Nuclear Suppliers Group
• Missile Technology Control Regime
• Australia Group
• Wassenaar Arrangement
• Legal authority to deny licenses
• Criminal and civil penalties

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Export CONTROLS (cont.)

• Licensing Procedures and Practices
• Licensing organizations
• Procedures, databases and watch lists
• Process to ensure government agencies have the
  knowledge and opportunity to evaluate license
  applications

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Export CONTROLS (cont.)

• Enforcement, Investigation and Prosecution
• Enforcement agencies prosecute violators of
  export control laws and regulations
• Authorities review details of manifest data to
  analyze for suspicious transfers
• Procedures to apply risk management and targeting
  strategies to detect suspect transfers and to
  minimize impediments to legitimate trade.
• Use of inspection techniques and equipment to
  identify potential transfers of proliferation
  concern.

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Export CONTROLS (cont.)

• Industry Outreach
• Effective outreach to raise the awareness of
  companies and commercial individuals,
  universities, and centers of research and
  development - including conventions and trade
  shows -- about their responsibilities under the
  economys export control system, including
  penalties for violations.
• Strong relationships with industry to identify
  suspect sales and deliveries.
• Efforts to encourage industry to develop internal
  compliance practices that incorporate checks on
  end-users and end-uses of concern.

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How Serious is This, Really?
Example Reprocessing Equipment
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How Do You Know If An Export License Is Required?

• A relatively small percentage of total U.S.
  exports and re-exports require a license from
  Bureau of Industry and Security (BIS) of the Dept
  of Commerce. License requirements are dependent
  upon an item's technical characteristics, the
  destination, the end-user, and the end-use. You,
  as the exporter, must determine whether your
  export requires a license. When making that
  determination consider
• What are you exporting?
• Where are you exporting?
• Who will receive your item?
• What will your item be used for?

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Agencies Involved In The United States Export
Control System

• Department of State
• Nuclear Regulatory Commission
• Department of Energy
• Department of Commerce
• Department of Defense (advisory role)
• Intelligence Community (advisory role)

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Transfer Mechanisms

• Publications
• Presentations
• Foreign visits
• Foreign travel

• Direct exports
• Sales, donations, loans, leases, transfers
• Patent assignments
• Communications

Whatever the transfer mechanism, an export
control review is a must.
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Export Control Classification Number Structure

• Controlled items are identified by an export
  control classification number, ECCN, e.g., 3A001

3 A 0 01
Category Group Reason for Control Item No.
0-Nuclear Materials, Facilities and Equipment 1-Materials, Chemicals, "Microorganisms," and Toxins 2-Materials Processing 3-Electronics 4-Computers 5-Telecomm and Information Security 6-Sensors and Lasers 7-Navigation and Avionics 8-Marine 9-Propulsion Systems, Space Vehicles and Related Equipment A - Equipment, Assemblies and Components B - Test, Inspection and Production Equipment C - Materials D - Software E - Technology 0 NS (Natl Security) and NP EDP items 1 MT 2 NP Dual-Use 3 CB Not mutually exclusive, assigned in order of precedence
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Export Restriction Notice

• The use, disposition, export and re-export of
  this property are subject to all applicable U.S.
  laws and regulations, includingwhich among other
  things, prohibit
• The making of false statements and concealment of
  any material information regarding the use or
  disposition, export or re-export of the property
  and
• Any use or disposition, export or re-export of
  the property which is not authorized in
  accordance with the provisions of this agreement,
• This statement must accompany any transfer of the
  commodities (see example).

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The Nuclear Suppliers Group (NSG)

• The NSG is a group of 45 nuclear supplier
  countries that seek to avert the proliferation of
  nuclear weapons by implementing Guidelines for
  nuclear exports and nuclear-related, dual-use
  exports.
• The NSG has developed two sets of export control
  Guidelines
• Guidelines for Nuclear Transfers
• Published by the International Atomic Energy
  Agency (IAEA) as INFCIRC/254/Part 1 (as
  amended)Part 1
• Includes the Trigger List in Annexes A and B
• Guidelines for Transfers of Nuclear-Related
  Dual-Use Equipment, Materials, Software and
  Related Technology
• INFCIRC/254/Part 2 (as amended)Part 2
• Includes the Dual-Use List in its Annex

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The Trigger List
What items are on the Trigger List?
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The NSG GuidelinesPart 1

• Guidelines for Nuclear Transfers (INFCIRC
  254/Part 1) is a 52-page document that includes
  the Trigger List, which is an illustrative list
  covering items that are especially designed or
  prepared (EDP) for nuclear use.
• The Trigger List (Annexes A and B to Part 1)
  includes
• A. Nuclear material e.g., uranium (U),
  plutonium (Pu)
• B. Materials and Equipment
• 1. Nuclear reactors and equipment EDP therefor
• 2. Non-nuclear materials for reactors (e.g.,
  heavy water)
• 3. Reprocessing plants and equipment EDP
  therefor
• 4. Nuclear fuel fabrication plants and equipment
  EDP therefor
• 5. Uranium enrichment plants and equipment EDP
  therefor
• 6. Heavy water production plants and equipment
  EDP therefor
• 7. U and Pu conversion plants and equipment EDP
  therefor
• Especially Designed or Prepared 146 occurrences
  in Part 1
• The Trigger List is firmly rooted in the
  Non-Proliferation Treaty (NPT)

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Non-Nuclear Materials for Reactors
Nuclear grade graphite
Stainless steel heavy water drums.
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Pumps EDP for Use in aNuclear Reactor
? Four pumps EDP for use in a nuclear reactor.
One of the motor nameplates, whichreads,
nuclear service motor. ?
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The Dual-Use List
What items are on the Dual-Use List?
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Categories of Dual-Use-List Items

• 1. Industrial equipment (e.g., machine tools)
• 2. Materials (e.g., carbon fiber)
• 3. Uranium isotope separation equipment and
  components (e.g., filament winding machines)
• 4. Heavy water production plant related
  equipment(e.g., special pumps)
• 5. Test and measurement equipment for the
  development of nuclear explosive devices(e.g.,
  photomultiplier tubes see next chart)
• 6. Components for nuclear explosive
  devices(e.g., detonators)

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Industrial Equipment and Materials
Crucibles made of various materials
High-accuracy milling machine
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Test Measurement Equipment
Pulse generators
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Chem/Bio Commodities
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Manufacturing Equipment for Chemicals

• Manufacturing Equipment
• Reaction Vessels, Reactors or Agitators
• Storage Tanks, Containers or Receivers
• Heat Exchangers or Condensers
• Distillation or Absorption Columns
• Filling Equipment
• Valves
• Multi-Walled Piping
• Pumps
• Incinerators
• Toxic Gas Monitoring Systems and Detectors

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Corrosion-Resistant Materials

• Nickel or alloys with more than 40 nickel by
  weight
• Alloys with more than 25 nickel and 20 chromium
  by weight
• Titanium or titanium alloys
• Tantalum or tantalum alloys
• Zirconium or zirconium alloys
• Niobium (columbium) or niobium alloys
• Fluoropolymers (e.g., PTFE, FEP, PFA, PVF)
• Glass or glass lined
• Graphite or carbon graphite
• Silicon carbide
• Titanium carbide
• Ceramics
• Ferrosilicon

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Manufacturing Equipment for Bio

• Fermenters
• Centrifugal Separators
• Laboratory
• Decanter
• Flow Filtration Equipment
• Freeze-Drying Equipment
• Aerosol Inhalation Chambers
• Containment Equipment
• Spraying and Fogging Systems
• Protective Suits

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U.S. Munitions List
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Categories of U.S. Munitions List

• Firearms, Close Assault Weapons and Combat
  Shotguns
• Guns and Armament
• Ammunition/Ordnance
• Launch Vehicles, Guided Missiles, Rockets,
  Torpedoes, Bombs, and Mines
• Explosives and Energetic Materials, Propellants,
  Incendiary Agents and Their Constituents
• Vessels of War and Special Naval Equipment
• Tanks and Military Vehicles
• Aircraft and Associated Equipment
• Military Training Equipment
• Protective Personnel Equipment
• Military Electronics

• Fire Control, Range Finder, Optical and Guidance,
  and Control Equipment
• Auxiliary Military Equipment
• Toxicological Agents, Including Chemical Agents,
  Biological Agents, and Associated Equipment
• Spacecraft Systems and Associated Equipment
• Nuclear Weapons, Design and Testing Related Items
• Classified Articles, Technical Data and Defense
  Services Not Otherwise Enumerated
• Directed Energy Weapons
• Reserved
• Submersible Vessels, Oceanographic and Associated
  Equipment
• Miscellaneous Articles

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Demilitarization

• DEMIL is the act of destroying the offensive or
  defensive advantages inherent in certain types of
  military equipment or material. The term can
  include mutilation, dumping at sea, cutting,
  crushing, scrapping, melting, burning or
  alteration design to prevent the further use of
  the equipment and material for its originally
  intended military or lethal purpose.

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Coding of Munitions List Items Demilitarization
Codes

• Demilitarization coding is a method used by DoD
  for the control of DoD personal property-
  Demilitarization Coding Management Office (DCMO).
• Every item in the Federal Stock System is
  required to have a DEMIL Code
• Any item turned in to a disposal activity must
  have a DEMIL code and/or clear text statement of
  DEMIL instructions.
• If MLI/SME, items requires DEMIL worldwide.
• There are eight Demilitarization (DEMIL) Codes
• DEMIL Code
• A single character alpha code identifying the
  degree of DEMIL necessary prior to accomplishing
  final disposition of a MLI

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DEMIL Codes (cont.)

• A Non-MLI/Non-CCLI DEMIL not required
• B MLI (Non-SME) DEMIL not required.
  TradeSecurity Controls required at disposition
• C MLI (SME) Remove and/or demilitarize
  installed key point(s), as prescribed in the
  manual, or lethal parts, components and
  accessories
• D MLI (SME) total destruction of item and
  components so as to preclude restoration or
  repair to a useable condition by melting,
  cutting, tearing, scratching, crushing,
  breaking, punching, neutralizing, etc.

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Transfer of Surplus Property

• There is a presumption of destruction for
• NSG Trigger List items (equipment or materials
  especially designed or prepared for nuclear use)
• Weapons components
• These items must be rendered useless for nuclear
  purposes before being offered to the public or a
  transfer agreement shouldrequire supervised
  disposalas scrap (see example)

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Change of Custody

• Although not technically disposal, it is still
  a vulnerable area regarding export control
• Loans, subcontracts, etc.
• Review with your site SMEs (Export Control,
  Legal, etc.)
• Transfer of Custody Form

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Property management and export control are
difficult!

• I want to express my utmost sympathy with the
  people who have to grapple with this problem the
  spread of nuclear weapons capabilities, and in
  the strongest terms urge you not to underestimate
  its difficulty.
• J. Robert Oppenheimer, Father of the atomic
  bomb,and first director of Los Alamos National
  Laboratory

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Nonproliferation and Property Management

• An effective property management system at your
  site is vital to the nonproliferation of these
  WMD technologies
• Use the Export Control Notice on all disposals!
• Resources are available to assist
• Training / Guidebooks / Handbooks
• Export Control Specialists
• Technical Experts

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CONTACT INFORMATION

• Cheri L. Cross, CPPM, CF
• 865.574.6046
• crosscl_at_ornl.gov
• Marcia D. Whitson, CPPM, CF
• 865.241.5120
• whitsonmd_at_ornl.gov