The European Union (“EU”) has adopted a Recast of Regulation (EC) 1334/2000 (“EU Dual Use Regulation”) by adoption Regulation (EC) No 428/2009. The Recast provides for new legislation on controlling exports, transfers, brokering and transit of dual-use items for, within or through the EU. Furthermore, Annex I of the EU Dual Use Regulation which provides for the common EU control list of dual-use items has been amended. Regulation (EC) 428/2009 comes into force on the 27th August 2009.
New Controls on brokering services
The Recast provides for authorisations for persons providing brokering services in relation to dual-use items listed in Annex I of the EU Dual Use Regulation. An authorisation shall be required for brokering services of dual-use items listed in Annex I if the broker has been informed by the competent authorities of the EU Member States in which the broker is established or resident that the items are or may be intended for Weapons of Mass Destruction (“WMD”) end-use. Furthermore, when the broker is aware that such items are intended for WMD end-use he must notify the competent authorities who will decide whether an authorisation is needed.
The Recast provides for a model that is to be used for broker services authorisations.
EU Member States may adopt national provisions to impose an authorisation for brokering services of dual-use items that are not listed in Annex I and that are or may be intended for WMD or military end-use. Furthermore, EU Member States may adopt national provisions providing for an authorisation requirement if the broker has grounds that the dual-use items in question are or may be intended for WMD end-use. EU Member States have to notify the European Commission of these measures.
Controls on transit
The Recast imposes controls on transit of dual-use items. Transit is being defined as “transport of a non-Community dual-use items entering and passing through the customs territory of the Community with a destination outside the Community”.
The EU Dual Use Regulation provided only for an authorisation on export of items listed in Annex I of the EU Dual-Use Regulation. Export was defined as “export within the meaning of Article 161 of Regulation (EEC) No 2913/92 (the Community Customs Code, “CCC”), a “re-export within the meaning of Article 182 CCC” and “transmission of software or technology by electronic media, including by fax, telephone, electronic mail or any other electronic means to a destination outside the European Community”. The definition for “export” will be the same with the exception that export is also re-export within the meaning of Article 182 CCC but not including items in transit”.
The transit controls include that EU Member States may prohibit a transit of dual-use items if the items are or may be intended for WMD end-use. Furthermore, EU Member State may impose an authorisation requirement during the period that the competent authorities need to decide whether they will prohibit the transit. This will enable the entity or person involved to show that the items are intended for civil end-use rather than WMD end-use.
Finally, EU Member States may adopt national provisions to extend the prohibition and authorisation requirement to transit of dual-use items that are not listed in Annex I of the EU Dual Use Regulations that are or may be intended for WMD or military end-use. EU Member States have to notify the European Commission of these provisions.
Amendment of Annex I
Annex I has been amended. Amendments include export control classification numbers (“ECCNs”) in all categories. Certain amendments include new or old definitions, but also new controls have been added. The European Commission has made a summary of changes listing all amendments. In order to review this summary, please visit the following link. (http://trade.ec.europa.eu/doclib/docs/2009/june/tradoc_143396.en09%20CN07_03.pdf).
Annex IV that lists dual-use items that are subject to an intra-Community license has not been amended.
Consequences Recast for the Netherlands
The Dutch Decision on strategic goods, which is based on the General Custom Law, will have to be amended to include amendments in relation to the movement of dual-use items. However, amendments in relation to dual-use services require the adoption of a new law in the Netherlands, because the Dutch General Customs law is limited to export controls of dual-use items and does not include strategic services.
For that purpose, the Law on Strategic Services (in Dutch: Wet strategische diensten) will be adopted. This law will include the already existing legislation on strategic services, but will also include new controls.
The law on strategic services will make a difference between services for dual-use items and military items. The proposal distinguishes three forms of strategic services: non-physical transfer of software and technology, technical assistance and brokering.
With respect to dual-use items, the non-physical transfer of software and technology was already included in the EU Dual Use Regulation. The provisions related to brokering have been added in the Recast. The controls related to technical assistance are laid down in Council Joint Action of 22 June 2000 concerning the control of technical assistance related to certain military end-uses (2000/0401/CFSP).
The State Secretary of the Dutch Ministry of Economic Affairs aims to finalise the proposal to adopt the Law on Strategic Services in 2010. Within that context, the State Secretary will verify to what extent this law will have to include extra-territorial elements.