State Dept. Regulatory Agenda Mentions Defense Services Update, Other ITAR Changes

One proposed rule would revise the ITAR by updating the “definition of defense service and the scope of related controls,” and would also request public comments on those changes. A government official in April said the update will be “a major change for service providers” (see 2404010041). The State Department’s Directorate of Defense Trade Controls completed an interagency review for the rule on July 12, and the agency is hoping to publish the proposed updates this month.

The agenda also mentioned several new rules, including one expected in September that would update ITAR controls for the Democratic Republic of Congo to align U.S. restrictions with those adopted by the U.N. Security Council. Another previews an upcoming rule, expected in August, to finalize a new defense trade exemption for certain exports to Australia and the U.K. as part of the AUKUS partnership (see 2404300050), while another would make corrections to a March final rule that imposed new export controls against Nicaragua by adding it to the agency's Proscribed Countries list (see 2403140031). That rule is expected this month.

The State Department continued to mention a proposed rule that would update certain controls around “circuit boards and semiconductors.” That change would revise “paragraphs (c)(1) through (4) of” Category XI of the U.S. Munitions List to “describe more precisely the articles warranting control on the USML.” The agency previously said it expected to issue the rule in August (see 2312280016), but the rule is now set for January.

The agenda also continued to mention rules to update and reorganize the ITAR (see 2302240048), including one proposed rule that would help with the “modernization” of the USML. The rule, due in January, would propose changes to the USML and to Supplement No. 1 to Part 126 of the ITAR to “standardize language and structure across Categories and entries for purposes of consistency, clarity, and improved ease of use.”

Another rule could revise specific controls for certain defense exports by making “targeted revisions” to the USML. This interim final rule would remove entries that shouldn’t be subject to license requirements and add entries for “critical and emerging technologies that warrant inclusion.” It would also “limit the items categorized in USML Category XXI by updating the appropriate USML paragraph.” The agency had expected to issue the rule in January 2024 but is now hoping to publish it this month.

Highlights of the State Department's trade-related rulemakings that are at the pre-rule, proposed, final or completed stages are below. New items are marked with an asterisk (*).