or carry as cargo any defense article, without a temporary export license (Form DSP-73) from the Department of State. (See § 123.4).

§ 123.12 Shipments between U.S. possessions.

An export license is not required for the shipment of defense articles between the United States, the Commonwealth of Puerto Rico, and U.S. possessions. A license is required, however, for the export of defense articles from these areas to foreign countries.

§ 123.13 Domestic aircraft shipments via a foreign country.

A license is not required for the shipment by air of a defense article from one location in the United States to another location in the United States via a foreign country. The pilot of the aircraft must, however, file a written statement with the district director of customs at the port of exit in the United States. The original statement must be filed at the time of exit with the district director of customs. A duplicate must be filed at the port of reentry with the district director of customs, who will duly endorse it and transmit it to the district director of customs at the port of exit. The statement will be as follows:

§ 123.14 Import certificate/delivery verification procedure.

The United States and a number of foreign countries have agreed on procedures designed to assure that a commodity imported into their territory will not be diverted, transshipped, or reexported to another destination except in accordance with export control regulations of the importing country. This is known as the Import Certificate/Delivery Verification Procedure (IC/DV) and may be invoked with respect to defense articles.

(a) Exports. The Department of State may require the IC/DV_procedure on proposed exports of defense articles to non-government entities in the following countries: Austria, Belgium, Denmark, France, Federal Republic of Germany, Greece, Hong Kong, Italy, Japan, Luxembourg, the Netherlands, Norway, Portugal, Turkey, and the United Kingdom. In such cases, U.S. exporters must submit both an export license application (the completed Form DSP-5) and the original Import Certificate, which must be provided and authenticated by the government of the importing country. This document verifies that the foreign importer complied with the import regulations of the government of the importing country and that the importer declared the intention not to divert, transship or reexport the material described therein without the prior approval of that government. After delivery of the commodities to the foreign consignee, the Department of State may also require U.S. exporters to furnish Delivery Verification documentation from the government of the importing country. This documentation verifies that the delivery was in accordance with the terms of the approved export license. Both the "Import Certificate" and the "Delivery Verification" must be furnished to the U.S. exporter by the foreign importer.

(b) Triangular transactions. When a transaction involves three or more countries which have adopted the IC/ DV procedure, the governments of these countries may stamp a triangular symbol on the Import Certificate. This symbol is usually placed on the

end-user and end-use prior to submitting an application to the Office of Munitions Control or claiming an exemption under this subchapter. Enduse must be confirmed and should not be assumed.

(b) The exporter shall incorporate the following statement as an integral part of the shipper's export declaration, the bill of lading, and the invoice whenever defense articles on the U.S. Munitions List are to be exported:

These commodities are authorized by the U.S. Government for export only to (country of ultimate destination). They may not be resold, diverted, transferred, transshipped, or otherwise be disposed of in any other country, either in their original form or after being incorporated through an intermediate process into other end-items, without the prior written approval of the U.S. Department of State.

§ 123.10 Non-transfer and use assurances and Congressional notification.

(a) An application for a license (Form DSP-5) to export significant military equipment defined in § 120.19 must be accompanied by a nontransfer and use certificate (Form DSP-83) at the time of submission to the Office of Munitions Control. This form is to be executed by the foreign consignee and foreign end-user. The certificate stipulates that, except as specifically authorized by prior written approval of the Department of State, the foreign consignee and foreign end-user will not reexport, resell or otherwise dispose of the significant military equipment enumerated in the application outside the country named as the location of the foreign end-use.

(b) The DSP-83 may be accepted at a time other than that specified in paragraph (a) of this section if there are special reasons for doing so. A statement of such reasons must accompany the application for a license.

(c) The Office of Munitions Control may also require a DSP-83 for the export of any other defense articles or defense services.

(d) When a DSP-83 is required for an export of any defense article or defense service to a non-governmental foreign end-user, the Office of Munitions Control may require as a condition of issuing the license that the appropriate authority of the government

of the country of ultimate destination also execute the certificate. This means that the foreign government undertakes not to authorize the reexport, resale, or other disposition of the defense articles or defense service enumerated in the application without ensuring that the prior written consent of the U.S. Government has been obtained.

(e) All exports of major defense equipment sold under a contract in the amount of $14,000,000 or more or of defense articles and defense services sold under a contract in the amount of $50,000,000 or more may take place only after the Office of Munitions Control notifies the exporter that thirty calendar days have elapsed since receipt by the Congress of the certification required by the Arms Export Control Act. The issuance of a license or other written approval shall serve as notification that this period has elapsed. Persons who intend to export defense articles and services pursuant to the exemption in § 126.5 under the circumstances described in the first sentence of this subsection must notify the Office of Munitions Control by letter of the intended export and provide a DSP-83 signed by the foreign consignee and end-user. Such exports may take place after the Office of Munitions Control notifies the exporter by letter that the thirty day period has elapsed.

[49 FR 47691, Dec. 6, 1984, as amended at 51 FR 47014, Dec. 30, 1986]

§ 123.11

Movements of aircraft and vessels of war outside the United States. (a) General. A license issued by the Office of Munitions Control is required whenever a privately-owned aircraft or vessel of war on the United States Munitions List makes a voyage outside the United States.

(b) Exemption. An export license is not required when a vessel or aircraft referred to in section (a) departs from the United States and does not enter the territorial waters or airspace of a foreign country if no defense articles are carried as cargo. Such a vessel or aircraft may not enter the territorial waters or airspace of a foreign country before returning to the United States,

or carry as cargo any defense article, without a temporary export license (Form DSP-73) from the Department of State. (See § 123.4).

§ 123.12 Shipments between U.S. possessions.

An export license is not required for the shipment of defense articles between the United States, the Commonwealth of Puerto Rico, and U.S. possessions. A license is required, however, for the export of defense articles from these areas to foreign countries.

§ 123.13 Domestic aircraft shipments via a foreign country.

A license is not required for the shipment by air of a defense article from one location in the United States to another location in the United States via a foreign country. The pilot of the aircraft must, however, file a written statement with the district director of customs at the port of exit in the United States. The original statement must be filed at the time of exit with the district director of customs. A duplicate must be filed at the port of reentry with the district director of customs, who will duly endorse it and transmit it to the district director of customs at the port of exit. The statement will be as follows:

§ 123.14 Import certificate/delivery verification procedure.

The United States and a number of foreign countries have agreed on procedures designed to assure that a commodity imported into their territory will not be diverted, transshipped, or reexported to another destination except in accordance with export control regulations of the importing country. This is known as the Import Certificate/Delivery Verification Procedure (IC/DV) and may be invoked with respect to defense articles.

(a) Exports. The Department of State may require the IC/DV procedure on proposed exports of defense articles to non-government entities in the following countries: Austria, Belgium, Denmark, France, Federal Republic of Germany, Greece, Hong Kong, Italy, Japan, Luxembourg, the Netherlands, Norway, Portugal, Turkey, and the United Kingdom. In such cases, U.S. exporters must submit both an export license application (the completed Form DSP-5) and the original Import Certificate, which must be provided and authenticated by the government of the importing country. This document verifies that the foreign importer complied with the import regulations of the government of the importing country and that the importer declared the intention not to divert, transship or reexport the material described therein without the prior approval of that government. After delivery of the commodities to the foreign consignee, the Department of State may also require U.S. exporters to furnish Delivery Verification documentation from the government of the importing country. This documentation verifies that the delivery was in accordance with the terms of the approved export license. Both the "Import Certificate" and the "Delivery Verification" must be furnished to the U.S. exporter by the foreign importer.

(b) Triangular transactions. When a transaction involves three or more countries which have adopted the IC/ DV procedure, the governments of these countries may stamp a triangular symbol on the Import Certificate. This symbol is usually placed on the

Import Certificate when the applicant for the Import Certificate (the importer) stated either (1) that there is uncertainty whether the items covered by the Import Certificate will be imported into the country issuing the Import Certificate; (2) that he or she knows that the items will not be imported into the country issuing the Import Certificate; or (3) that, if the items are to be imported into the country issuing the Import Certificate, they will subsequently be reexported to another destination. Thus, it is possible that the ultimate consignee and the country of ultimate destination will not coincide with that of the importer. All parties, including the ultimate consignee in the country of ultimate destination, must be shown on the completed Import Certificate.

§ 123.15 [Reserved]

EXEMPTIONS

§ 123.16 Obsolete firearms and models.

(a) District directors of customs may permit the export without a license of nonautomatic firearms covered by Category I(a) of § 121.1 if they were manufactured in or before 1898, as well as replicas of such firearms.

(b) District directors of customs may permit the export without a license of unclassified models or mock-ups of defense articles provided that they are nonoperable and do not reveal any technical data in excess of that which is exempted from the licensing requirements of § 125.4(b). U.S. persons who avail themselves of this exemption must provide a written certification to the district director of customs that these conditions are met. This exemption does not imply that the Office of Munitions Control will approve the export of any defense articles for which models or mocks-ups have been exported pursuant to this exemption.

§ 123.17 Exports of firearms and ammunition for personal use.

(a) District directors of customs may permit U.S. persons to export temporarily from the United States without a license not more than three nonautomatic firearms in Category I(a) of

§ 121.1 and not more than 1,000 cartridges therefor, provided that:

(1) A declaration by the U.S. person and an inspection by a customs officer is made;

(2) The firearms and accompanying ammunition must be with the U.S. person's baggage or effects, whether accompanied or unaccompanied (but not mailed); and

(3) They must be for that person's exclusive use and not for resale or other transfer of ownership. The foregoing exemption is not applicable to a crew-member of a vessel or aircraft unless the crew-member declares the firearms to a customs officer upon each departure from the United States, and declares that it is his or her intention to return the articles on each return to the United States. It is also not applicable to the personnel referred to in § 123.18.

(b) District directors of customs may permit a foreign person to export without a license such firearms in Category I(a) of § 121.1 and ammunition therefor as the foreign person brought into the United States under the provisions of 27 CFR 178.115(d). (The latter provision specifically excludes from the definition of importation the bringing into the United States of firearms and ammunition by certain foreign persons for specified purposes.)

(c) District directors of customs may permit U.S. persons to export without a license ammunition for nonautomatic firearms referred to in paragraph (a) of this section if the quantity does not exceed 1,000 cartridges (or rounds) in any shipment. The ammunition must also be for personal use and not for resale or other transfer of ownership. The foregoing exemption is also not applicable to the personnel referred to in § 123.18.

§ 123.18 Firearms for personal use of members of the U.S. Armed Forces and civilian employees of the U.S. Government.

The following exemptions apply to members of the U.S. Armed Forces and civilian employees of the U.S. Government who are U.S. persons (both referred to herein as "personnel"). The exemptions apply only to

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.