Export Administration Act Reauthorization Update
 
March 21, 2002
 

The House Armed Services Committee has passed its version of the bill to reauthorize the Export Administration Act, (EAA) (H.R. 2581), and in doing so, reiterated that the primary purpose of the legislation is to protect the national security interests of the United States. The Committee’s version includes amendments that strengthen controls over the export of high performance computers and military-grade technologies. This approach is in sharp contrast to the bill passed by the Senate (S. 149) and supported by the Bush Administration, which favors liberalization of controls over the export of technologies already widely available overseas. The EAA, which controls the export of dual-use items, expired in 1994 but has been kept alive by annual executive orders (and a one-year legislative extension last Congressional session) while Congress struggles to reach a long-term solution.

On a strong bipartisan vote, the House Committee accepted the following amendments to the bill:

Restore and strengthen the role of the Secretary of Defense in creating export control lists and making export license decisions in two major areas:

• The Secretary of Defense would have sole authority to establish and maintain the Militarily Critical Technologies List (MCTL), which lists dual-use technologies that are critical to the United States maintaining its military superiority and qualitative advantage (e.g., stealth and jet engine "hot section" technologies). Items listed on the MCTL could not be licensed for export without the approval of the Secretary of Defense, and only the Secretary of Defense could add or remove items from the MCTL. Only the President could overrule a decision of the Secretary of Defense regarding this list. The Senate bill does not retain the MCTL.

• Increase the input of the Secretary of Defense’s role in the dispute resolution process by requiring a unanimous decision in the interagency dispute resolution process. Under this change, an agency that disagrees with a licensing decision may appeal the decision to higher levels, up to the President, and no license would be approved until participating departments and agencies reached a unanimous decision. This requirement for consensus in the licensing process was a key recommendation of the Cox Committee, which investigated technology transfers to China. The Senate bill retains the current approach.

Create National Security Control Lists (NSCL): Items that could contribute to proliferation, terrorism or the military potential of other countries would be placed on a NSCL, which would be maintained by the Secretary of Commerce. However, items could be added or deleted only with the concurrence of the Secretary of State and the Secretary of Defense. The amendment provides for the continued use of the MCTL as a part of the NSCL. The Senate bill retains the NSCL but discards the MCTL.

Impose additional safeguards on dual-use items:

• Limit the scope and use of “foreign availability” and “mass market” designations. Under this change, the Secretary of Defense and the Secretary of State would be required to concur with any determination that an item should be exempted from export restrictions due to foreign availability or mass-market status. The terms also would be redefined. “Foreign availability” would mean that the items are available to controlled countries from sources outside the United States, including countries participating with the United States in multilateral export controls, and that are available in significant quantity and comparable quality to make controlling the item ineffective. “Mass market items” would be redefined as those that meet a list of requirements determined by the Secretary of Commerce including volume of sales, scope of distribution, ease of shipment, and ease of use without specialized services. The Senate bill retains the current approach toward mass exemptions of technologies widely available overseas.

• Replace the existing measure of computer performance – millions of theoretical operations per second (MTOPS) with a new system of high-performance computer export controls. The amendments would require the Secretaries of Commerce, Defense, State, and Energy to jointly develop and implement the new process, which would include a new definition and metrics for high-performance computing; an ability to assess proposed exports of such items in advance; and the establishment of post-shipment verification procedures. The Senate bill moves in the other direction to ease restrictions on the export of high-performance computers.

• Retain the current provisions that place primary control over the export of satellites and related items within the State Department. This provision rejects an amendment passed earlier by the House International Relations Committee to return authority for the export licensing of satellites to the Commerce Department.

Strengthen National Security Controls: Broaden the items available for control to encompass those that could contribute to the military capabilities, proliferation activities or terrorism potential of a country, and require the President to impose export controls on items controlled by multilateral regime or international obligation.

Strengthen congressional oversight of the export control system: Enhance congressional oversight of the export control system by requiring the Secretary of Commerce to notify Congress at least 30 days prior to a change being made to the export status of an item on the National Security Control List. In addition, the Secretary of Defense would be required to conduct an assessment of the national security impact of making such a change to the control list.

In a press statement, Congressman Robert Stump, the Chairman of the Committee, rejected assertions that the changes would result in lost sales opportunities. The Chairman stated that a 1995 Congressional Research Service study indicated that export controls resulted in lost sales that totaled less than one-fifth of one percent of the U.S. Gross Domestic Product, and that those costs pale in comparison to the extraordinary importance of protecting our nation's security. A copy of the statement is available at http://www.house.gov/hasc. The Bush Administration has committed to work toward passage of a law this year that resolves the differences between the Senate and House bills.