Fact Sheet: Changes to U.S. Dual-Use Export Controls

President Bush today announced changes to U.S. export controls on computers and microprocessors. This action advances the President's goal of reforming the U.S. export control system so that it avoids ineffective controls, and focuses on truly sensitive goods and technologies. The President's decision will promote national security, enhance the effectiveness of our export control system and ease unnecessary regulatory burdens on both government and industry. The Administration will make the following changes:

The President has decided to raise the level above which U.S. exporters are required to notify the Department of Commerce of proposed exports of computers to Tier 3 countries from 85,000 Millions of Theoretical Operations Per Second (MTOPS, a measure of computer performance) to 190,000 MTOPS. The Tier 3 countries include India, Pakistan, all of the Middle East/Maghreb, the former Soviet Union, China, Vietnam and parts of South Eastern Europe. This action requires a 60-day Congressional notification period before it can become effective. The Administration also will raise the individual licensing level for Tier 3 to 190,000 MTOPS.

The President has decided to move Latvia from Tier 3 to Tier 1. Tier 1 countries are Western Europe, Japan, Canada, Mexico, Australia, New Zealand, Hungary, Poland, the Czech Republic and Brazil, South and Central America, South Korea, most of the Association of Southeast Asian Nations, Slovenia and most of Africa. Currently, U.S. companies may export computers to Tier 1 under license exception (i.e., there is no prior government review). This action requires a 120-day Congressional notification period before it can become effective.

The United States will continue to maintain a virtual embargo on computer hardware and technology exports to Iraq, Iran, Libya, North Korea, Cuba, Sudan and Syria.

For all countries, U.S. re-export and retransfer requirements, and provisions of the Enhanced Proliferation Control Initiative (EPCI) will continue to apply. EPCI provides authority for the government to block exports of computers (or any other item) in cases where there is an unacceptable risk of diversion to proliferation activities (e.g., foreign nuclear weapons design laboratories). Criminal and civil penalties apply to EPCI violators.

The Commerce Department will continue to review its published list of entities of concern as a means of informing exporters of potential proliferation and other security risks. The Department will remind exporters of their duty to check suspicious circumstances and inquire about end-uses and end-users. Exporters are advised to contact the Commerce Department if they have any concern with the identity or activities of the end-users, and the Department will work to expand its efforts -- through public seminars and consultations with companies -- to keep industry regularly informed regarding problem end-users and programs of proliferation concern.

Microprocessors Controls. The Administration will raise the license exception level for exports of general purpose microprocessors from 6,500 MTOPS to 12,000 MTOPS.

The changes to computer and microprocessor controls announced today will become effective when published in the Export Administration Regulations.

Multilateral Coordination. The Administration has consulted with other nations, including members of the Wassenaar Arrangement, to ensure that they understand the basis for these decisions. We are committed to working closely with them to adjust multilateral controls to reflect technological advances and collective security concerns. Our controls remain consistent with the purposes of the Wassenaar Arrangement -- to deny arms and sensitive dual-use technologies to countries of concern, and to develop mechanisms for information sharing among the partners as a way to harmonize our export control practices and policies. The United States will also continue to implement reporting requirements on computer exports as appropriate to fulfill U.S. obligations under the Wassenaar Arrangement.