such personnel if they are assigned abroad for extended duty. These exemptions do not apply to dependents.

(a) Firearms. District directors of customs may permit nonautomatic firearms in Category I(a) § 121.1 and parts therefor to leave (but not be mailed from) the United States without a license if:

(1) They are consigned to servicemen's clubs abroad for uniformed members of the U.S. Armed Forces; or,

(2) In the case of a uniformed member of the U.S. Armed Forces or a civilian employee of the Department of Defense, they are consigned to the personnel for personal use and not for resale or other transfer of ownership, and if the firearms are accompanied by a written authorization from the commanding officer concerned; or,

(3) In the case of other U.S. Government employees, they are consigned to such personnel for personal use and not for resale or other transfer of ownership, and the Chief of the U.S. Diplomatic Mission or his designee in the country of destination has approved in writing to Department of State the bringing of the specific types and quantities of firearms into that country.

(b) Ammunition. District directors of customs may permit not more than 1,000 cartridges (or rounds) of ammunition for the firearms referred to in paragraph (a) of this section to be exported (but not mailed) from the United States without a license when the firearms are on the person of the owner or with his baggage or effects, whether accompanied or unaccompanied (but not mailed).

§ 123.19 Minor components.

Except as provided in § 126.1, district directors of customs are authorized to permit the export without a license of components and parts for Category I(a) firearms, except barrels, cylinders, receivers (frames), or complete breech mechanisms, when the total value does not exceed $500 wholesale in any single transaction.

§ 123.20 Canadian and Mexican border

shipments.

A shipment originating in Canada or Mexico which incidentally transits the

(a) The provisions of this subchapter do not apply to equipment in Category VI(e) and Category XVI of § 121.1 to the extent such equipment is under the export control of the Department of Energy or the Nuclear Regulatory Commission pursuant to the Atomic Energy Act of 1954, as amended, and the Nuclear Non-Proliferation Act of 1978.

(b) A license for the export of any machinery, device, component, equipment, or technical data relating to equipment referred to in Category VI(e) will not be granted unless the proposed export comes within the scope of an existing Agreement for Cooperation for Mutual Defense Purposes concluded pursuant to the Atomic Energy Act of 1954, as amended, with the government of the country to which the article is to be exported. Licenses may be granted in the absence of such an agreement only (1) if the proposed export involves an article which is identical to that in use in an unclassified civilian nuclear powerplant, (2) if the proposed export has no relationship to naval nuclear propulsion, and (3) if it is not for use in a naval propulsion plant.

nical data must be made on Form DSP-85.

(e) The following specific procedures apply to the preparation and submission of applications:

(1) Applications for Department of State export licenses must be confined to proposed exports of defense articles and related technical data. Applications for licenses to export commodities under the regulatory jurisdiction of the Department of Commerce must be made directly to that Department.

(2) Form DSP-5, DSP-61, DSP-73, and DSP-85 applications must have an entry in each block where space is provided for an entry. Any supporting documentation concerning commodity, end-use, and specific purpose should be submitted in seven copies. Samples of properly executed applications are available from the Office of Munitions Control.

(3) Form DSP-83, duly executed, must accompany all license applications for the permanent export of significant military equipment except in the

circumstances described in

§ 123.10(b).

(4) Applications for permanent export licenses should not be submitted until the applicant has a firm order, letter of intent or other appropriate documentation from the purchaser or consignee except in the circumstances described in § 123.1(c).

(5) A request under the provisions of section 38(e) of the Arms Export Control Act (22 U.S.C. 2778(e)) for confidential treatment of information provided to the Department of State must be made by letter to the Office of Munitions Control.

§ 123.23 Renewal and disposition of li

censes.

(a) A license is valid for a period of two years. The license expires if the defense articles described in the license are not shipped within the twoyear period. Defense articles to be shipped thereafter require a new application and license. The new application should refer to the expired license. It should not include references to any defense articles other than those of the unshipped balance of the expired license.

(b) Unused, expired, expended, suspended, or revoked licenses must be returned immediately to the Department of State.

§ 123.24 Port of exit or entry.

An application for a license must state the proposed port of exit from the United States. If applicable, the port of entry must also be stated. After a license is issued, the person to whom the license was issued must notify the Office of Munitions Control in writing of any proposed change of the port prior to export. A copy of such written notification must be sent to the district director of customs at the new port.

§ 123.25 Filing of export and intransit licenses and shipper's export declarations with district directors of customs. (a) The recipient of an export license must deposit the license with the district director of customs at the port of exit designated on the license before shipping the defense article in question. (For exports by mail, see § 123.26.) After a license has been so deposited, the export may be made through the designated port. If necessary, the export may be made through another port if the exporter complies with the procedures established by the U.S. Customs Service and § 123.24. Before shipping any defense article, the exporter must also file a shipper's export declaration (Department of Commerce Form 7525-V) with the district director of customs at the port of exit.

(b) Before any export occurs, the district director of customs at the port of exit must authenticate the shipper's export declaration, and endorse the license to show the shipments actually made. The district director of customs will return a copy of each authenticated shipper's export declaration to the Office of Munitions Control. Every license will also be returned upon the completion of the authorized export or upon the expiration date stated on the license, whichever occurs first.

(c) An exporter must also file a shipper's export declaration with district directors of customs or postmasters in

those cases in which no export license is required because of an exemption in this subchapter. The exporter must certify that the export is exempt from the licensing requirements of this subchapter. This is done by writing "22 CFR (identify section) applicable" on the shipper's export declaration, and by identifying the section under which an exemption is claimed. A copy of each such declaration must be mailed immediately by the exporter to the Office of Munitions Control. This paragraph does not create an obligation to file a shipper's export declaration if (1) the export is exempt from the licensing requirements of this subchapter pursuant to § 126.4 and (2) it is not otherwise required by law or by regulations other than those contained in this subchapter.

(d) District directors of customs are authorized to permit the shipment of defense articles identified on any license when the total value of the export does not exceed the aggregate monetary value (not quantity) stated on the license by more than ten percent.

§ 123.26 Shipments by mail.

An export license for defense articles being sent abroad by mail must be filed with the postmaster at the post office where the equipment is mailed. A shipper's export declaration (U.S. Department of Commerce Form 7525V) must be filed with and be authenticated by the postmaster before the article is actually sent. The postmaster will endorse each license to show the shipments made. Every license must be returned by the postmaster to the Office of Munitions Control upon completion of the mailings or the date that the license expires, whichever occurs first.

§ 123.27 Temporary exports.

(a) If defense articles are to be sent abroad for brief periods and returned to the United States in the same condition, a license for the temporary export of defense articles must be obtained from the Department of State (Form DSP-73).

(b) Defense articles authorized for temporary export under this section may be shipped only from a port in

the United States where a district director of customs is available. The license for temporary export must be presented to the district director of customs who, upon verification, will endorse the exit column on the reverse Iside of the license. The endorsed license for temporary export is to be retained by the licensee. In the case of a military aircraft or vessel, the endorsed license must be carried on board such vessel or aircraft as evidence that it has been duly authorized by the Department of State to leave the United States temporarily.

124.10 Additional clauses required only in manufacturing license agreements.

124.11 Non-transfer and use assurances. 124.12 Required information in letters of transmittal.

OFFSHORE PROCUREMENT AND WAREHOUSING

AGREEMENTS

124.13 Procurement by United States persons in foreign countries (offshore procurement).

124.14. Exports to warehouses or distribution points outside the United States.

AUTHORITY: Sec. 38, Arms Export Control Act, 90 Stat. 744 (22 U.S.C. 2778); E.O. 11958, 42 FR 4311; 22 U.S.C. 2658.

SOURCE: 49 FR 47695, Dec. 6, 1984, unless otherwise noted.

§ 124.1 Manufacturing license agreements and technical assistance agreements. (a) General. The approval of the Office of Munitions Control must be obtained before the defense services described in § 120.8(a) of this subchapter may be furnished. In order to obtain such approval, the U.S. person must submit a proposed agreement with the foreign person concerned to the Office of Munitions Control. Such agreements are generally characterized as either "Manufacturing license agreements" or "technical assistance agreements" as defined in § 120.14 and § 120.20, and may not enter into force without the prior written approval of the Office of Munitions Control. Once approved, the defense services described in the agreements may generally be provided without further licensing in accordance with § 124.3 and § 125.4(b)(2). The requirements of this section apply whether or not technical data is to be disclosed or used in the performance of the defense services described in § 120.8(a) (e.g., all the information relied upon by the U.S. person in performing the defense service is in the public domain or is otherwise exempt from the licensing requirements of this subchapter pursuant to § 125.4). This requirement also applies to the training of foreign military forces, both regular and irregular, in the use of defense articles. Technical assistance agreements must be submitted in such cases. (In exceptional cases, the Office of Munitions Control, upon written request, will consider approving the provision of defense serv

ices described in § 120.8(a) by granting a license under Part 125. Also, see § 126.8 for the requirements for prior approval of proposals relating to significant military equipment.)

(b) Amendments. Proposed amendments, including extensions, to agreements subject to the requirements of this part must also be submitted for approval. The amendments may also not enter into force until approved by the Office of Munitions Control. Amendments which only alter delivery or performance schedules, or other minor administrative amendments which do not affect in any manner the duration of the agreement or the clauses or information which must be included in such agreements because of the requirements of this part, do not have to be submitted for approval. One copy of all such minor amendments must be submitted to the Office of Munitions Control within thirty days after they are concluded.

§ 124.2 Exemptions for training and military service.

(a) Technical assistance agreements are not required for the provision of training only in the basic operation and maintenance of defense articles lawfully exported or authorized for export to the same recipient.

(b) Services performed as a member of the regular military forces of a foreign nation by U.S. persons who have been drafted into such forces are not deemed to be defense services for purposes of § 120.8.

§ 124.3 Exports of technical data in furtherance of an agreement.

(a) Unclassified technical data. District directors of customs or postal authorities may permit the export without a license of unclassified technical data if the export is in furtherance of a manufacturing license or technical assistance agreement which has been approved in writing by the Office of Munitions Control. The export is not authorized without a license if it exceeds the scope or limitations of the relevant agreement. The U.S. party to the agreement must certify that the export does not exceed the scope of the agreement and any limitations im

posed pursuant to this part. The approval of the Office of Munitions Control must be obtained for the export of any unclassified technical data which may exceed the terms of the agreement.

(b) Classified technical data. The export of classified information in furthernance of an approved manufacturing license or technical assistance agreement which provides for the transmittal of classified information does not require further approval from the Office of Munitions Control when:

(1) The United States party certifies to the Department of Defense transmittal authority that the classified information does not exceed the technical or product limitations in the agreement; and

(2) The United States party complies with the requirements of the Department of Defense Industrial Security Manual concerning the transmission of classified information, and any other requirements of cognizant U.S. departments or agencies.

[49 FR 47695, Dec. 6, 1984; 49 FR 48536, Dec. 13, 1984]

§ 124.4 Deposit of signed agreements with the Office of Munitions Control.

The United States party to a manufacturing license or a technical assistance agreement must file one copy of the concluded agreement with the Office of Munitions Control not later than 30 days after it enters into force.

§ 124.5 Proposed agreements which are not concluded.

The United States party to any proposed manufacturing license agreement or technical assistant agreement must inform the Office of Munitions Control if a decision is made not to conclude the agreement. The information must be provided within 60 days of the date of the decision. These requirements apply only if the approval of the Office of Munitions Control was obtained for the agreement to be concluded (with or without any provisos).

§ 124.6 Termination of manufacturing license agreements and technical assistance agreements.

The United States party to a manufacturing license or a technical assistance agreement must inform the Office of Munitions Control in writing of the impending termination of the agreement not less than 30 days prior to the expiration date of such agreement.

PROCEDURES

§ 124.7 Required information and clauses in proposed agreements.

In order to be approved, all proposed manufacturing license agreements and technical assistance agreements must contain certain information and clauses. The information required is specified in § 124.8. The information required should be provided in terms which are as precise as possible. The clauses which must be included in both manufacturing license agreements and technical assistance agreements are stated in § 124.9. The additional clauses which must be stated in manufacturing license agreements

only are specified in § 124.10. If the United States party believes that a clause or some required information is not relevant or necessary in a particular agreement, the Office of Munitions Control may authorize the omission of the information or clause. The transmittal letter accompanying the agreement (see § 124.12) must state the reasons for any proposed variation in the required information or statements.

§ 124.8 Information required in all agreements.

The following information must be included in all manufacturing license agreements and technical assistance agreements:

(a) The agreement must describe the equipment and technology involved. They should be described by military nomenclature, contract number, Federal stock number, nameplate data, or other specific information;

(b) The agreement must describe the assistance and information to be furnished and the manufacturing rights to be granted, if any;