Impact of the Implementation of the Chemical Weapons Convention (CWC) on Legitimate Commercial Chemical, Biotechnology, and Pharmaceutical Activities Involving “Schedule 1” Chemicals (Including “Schedule 1” Chemicals Produced as Intermediates) During Calendar Year 2019

 
CONTENT
Federal Register, Volume 85 Issue 30 (Thursday, February 13, 2020)
[Federal Register Volume 85, Number 30 (Thursday, February 13, 2020)]
[Notices]
[Pages 8246-8247]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-02848]
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
[Docket No. 200113-0009]
RIN 0694-XC055
Impact of the Implementation of the Chemical Weapons Convention
(CWC) on Legitimate Commercial Chemical, Biotechnology, and
Pharmaceutical Activities Involving ``Schedule 1'' Chemicals (Including
``Schedule 1'' Chemicals Produced as Intermediates) During Calendar
Year 2019
AGENCY: Bureau of Industry and Security, Commerce.
ACTION: Notice of inquiry.
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SUMMARY: The Bureau of Industry and Security (BIS) is seeking public
comments on the impact that implementation of the Chemical Weapons
Convention (CWC), through the Chemical Weapons Convention
Implementation Act and the Chemical Weapons Convention Regulations
(CWCR), has had on commercial activities involving ``Schedule 1''
chemicals during calendar year 2019. The purpose of this notice of
inquiry is to collect information to assist BIS in its preparation of
the annual certification to the Congress on whether the legitimate
commercial activities and interests of chemical, biotechnology, and
pharmaceutical firms are harmed by such implementation. This
certification is required under Condition 9 of Senate Resolution 75
(April 24, 1997), in which the Senate gave its advice and consent to
the ratification of the CWC.
DATES: Comments must be received by March 16, 2020.
ADDRESSES: You may submit comments by any of the following methods
(please refer to RIN 0694-XC055 in all comments and in the subject line
of email comments):
     Federal rulemaking portal (http://www.regulations.gov)--
you can find this notice by searching on its regulations.gov docket
number, which is BIS-2019-0028;
     Email: [email protected]--include the phrase
``Schedule 1 Notice of Inquiry'' in the subject line;
     Fax: (202) 482-3355 (Attn: Willard Fisher);
     By mail or delivery to Regulatory Policy Division, Bureau
of Industry and Security, U.S. Department of Commerce, Room 2099B, 14th
Street and Pennsylvania Avenue NW, Washington, DC 20230.
FOR FURTHER INFORMATION CONTACT: For questions on the Chemical Weapons
Convention requirements for ``Schedule 1'' chemicals, contact Douglas
Brown, Treaty Compliance Division, Office of Nonproliferation and
Treaty Compliance, Bureau of Industry and Security, U.S. Department of
Commerce, Phone: (202) 482-2163. For questions on the submission of
comments, contact Willard Fisher, Regulatory Policy Division, Office of
Exporter Services, Bureau of Industry and Security, U.S. Department of
Commerce, Phone: (202) 482-2440.
SUPPLEMENTARY INFORMATION:
Background
    In providing its advice and consent to the ratification of the
Convention on the Prohibition of the Development, Production,
Stockpiling, and Use of Chemical Weapons and Their Destruction,
commonly called the Chemical Weapons Convention (CWC or ``the
Convention''), the Senate included, in Senate Resolution 75 (S. Res.
75, April 24, 1997), several conditions to its ratification. Condition
9, titled ``Protection of Advanced Biotechnology,'' calls for the
President to certify to Congress on an annual basis that ``the
legitimate commercial activities and interests of chemical,
biotechnology, and pharmaceutical firms in the United States are not
being significantly harmed by the limitations of the Convention on
access to, and production of, those chemicals and toxins listed in
Schedule 1.'' On July 8, 2004, President Bush, by Executive Order
13346, delegated his authority to make the annual certification to the
Secretary of Commerce.
    The CWC is an international arms control treaty that contains
certain verification provisions. In order to implement these
verification provisions, the CWC established the Organization for the
Prohibition of Chemical Weapons (OPCW). In order to achieve the object
and purpose of the Convention and the implementation of its provisions,
the CWC imposes certain obligations on countries that have ratified the
Convention (i.e., States Parties), among which are the enactment of
legislation to prohibit the production, storage, and use of chemical
weapons and the establishment of a National Authority to serve as the
national focal point for effective liaison with the OPCW and other
States Parties. The CWC also requires each State Party to implement a
comprehensive data declaration and inspection regime to provide
transparency and to verify that both the public and private sectors of
the State Party are not engaged in activities prohibited under the CWC.
    ``Schedule 1'' chemicals consist of those toxic chemicals and
precursors set
[[Page 8247]]
forth in the CWC ``Annex on Chemicals'' and in ``Supplement No. 1 to
part 712--SCHEDULE 1 CHEMICALS'' of the Chemical Weapons Convention
Regulations (CWCR) (15 CFR parts 710-722). The CWC identified these
toxic chemicals and precursors as posing a high risk to the object and
purpose of the Convention.
    The CWC (Part VI of the ``Verification Annex'') restricts the
production of ``Schedule 1'' chemicals for protective purposes to two
facilities per State Party: A single small-scale facility (SSSF) and a
facility for production in quantities not exceeding 10 kg per year. The
CWC Article-by-Article Analysis submitted to the Senate in Treaty Doc.
103-21 defined the term ``protective purposes'' to mean ``used for
determining the adequacy of defense equipment and measures.''
Consistent with this definition and as authorized by Presidential
Decision Directive (PDD) 70 (December 17, 1999), which specifies agency
and departmental responsibilities as part of the U.S. implementation of
the CWC, the Department of Defense (DOD) was assigned the
responsibility to operate these two facilities. DOD maintains strict
controls on ``Schedule 1'' chemicals produced at its facilities in
order to ensure accountability for such chemicals, as well as their
proper use, consistent with the object and purpose of the Convention.
Although this assignment of responsibility to DOD under PDD-70
effectively precluded commercial production of ``Schedule 1'' chemicals
for ``protective purposes'' in the United States, it did not establish
any limitations on ``Schedule 1'' chemical activities that are not
prohibited by the CWC.
    The provisions of the CWC that affect commercial activities
involving ``Schedule 1'' chemicals are implemented in the CWCR (see 15
CFR part 712) and in the Export Administration Regulations (EAR) (see
15 CFR 742.18 and 15 CFR part 745), both of which are administered by
the Bureau of Industry and Security (BIS). Pursuant to CWC
requirements, the CWCR restrict commercial production of ``Schedule 1''
chemicals to research, medical, or pharmaceutical purposes. The CWCR
prohibit commercial production of ``Schedule 1'' chemicals for
``protective purposes'' because such production is effectively
precluded per PDD-70, as described above. See 15 CFR 712.2(a).
    The CWCR also contain other requirements and prohibitions that
apply to ``Schedule 1'' chemicals and/or ``Schedule 1'' facilities.
Specifically, the CWCR:
    (1) Prohibit the import of ``Schedule 1'' chemicals from States not
Party to the Convention (15 CFR 712.2(b));
    (2) Require annual declarations by certain facilities engaged in
the production of ``Schedule 1'' chemicals in excess of 100 grams
aggregate per calendar year (i.e., declared ``Schedule 1'' facilities)
for purposes not prohibited by the Convention (15 CFR 712.5(a)(1) and
(a)(2));
    (3) Provide for government approval of ``declared Schedule 1''
facilities (15 CFR 712.5(f));
    (4) Provide that ``declared Schedule 1'' facilities are subject to
initial and routine inspection by the OPCW (15 CFR 712.5(e) and
716.1(b)(1));
    (5) Require 200 days advance notification of the establishment of
new ``Schedule 1'' production facilities producing greater than 100
grams aggregate of ``Schedule 1'' chemicals per calendar year (15 CFR
712.4);
    (6) Require advance notification and annual reporting of all
imports and exports of ``Schedule 1'' chemicals to, or from, other
States Parties to the Convention (15 CFR 712.6, 742.18(a)(1) and
745.1); and
    (7) Prohibit the export of ``Schedule 1'' chemicals to States not
Party to the Convention (15 CFR 742.18(a)(1) and (b)(1)(ii)).
    For purposes of the CWCR (see 15 CFR 710.1), ``production of a
Schedule 1 chemical'' means the formation of ``Schedule 1'' chemicals
through chemical synthesis, as well as processing to extract and
isolate ``Schedule 1'' chemicals. The phrase ``production of a schedule
1 chemical'' includes, in its meaning, the formation of a chemical
through chemical reaction, including by a biochemical or biologically
mediated reaction. ``Production of a Schedule 1 chemical'' is
understood, for CWCR declaration purposes, to include intermediates,
by-products, or waste products that are produced and consumed within a
defined chemical manufacturing sequence, where such intermediates, by-
products, or waste products are chemically stable and therefore exist
for a sufficient time to make isolation from the manufacturing stream
possible, but where, under normal or design operating conditions,
isolation does not occur.
Request for Comments
    In order to assist in determining whether the legitimate commercial
activities and interests of chemical, biotechnology, and pharmaceutical
firms in the United States are significantly harmed by the limitations
of the Convention on access to, and production of, ``Schedule 1''
chemicals as described in this notice, BIS is seeking public comments
on any effects that implementation of the CWC, through the Chemical
Weapons Convention Implementation Act and the CWCR, has had on
commercial activities involving ``Schedule 1'' chemicals during
calendar year 2019. To allow BIS to properly evaluate the significance
of any harm to commercial activities involving ``Schedule 1''
chemicals, public comments submitted in response to this notice of
inquiry should include both a quantitative and qualitative assessment
of the impact of the CWC on such activities.
Submission of Comments
    All comments must be submitted to one of the addresses indicated in
this notice. The Department requires that all comments be submitted in
written form. BIS will consider all comments received on or before
March 16, 2020. All comments, including those comments containing any
personally identifying information or information for which a claim of
confidentially is asserted either in the comments or their transmittal
emails, will be made available for public inspection and copying.
Parties who wish to comment anonymously may do so by submitting their
comments via Regulations.gov, leaving the fields that would identify
the commenter blank and including no identifying information in the
comment itself.
Richard E. Ashooh,
Assistant Secretary for Export Administration.
[FR Doc. 2020-02848 Filed 2-12-20; 8:45 am]
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