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On December 28, 2020, the US Department of Commerce’s Bureau of Industry and Security (“BIS”) issued a final rule amending the Export Administration Regulations (“EAR”) to revise the Country Group designations for Ukraine, Mexico, and Cyprus.  BIS has placed these countries’ into more permissive Country Groups due to these countries’ membership in multilateral export control regimes, as well as national security interests and policies compatible with those of the United States.  The impact of these changes is described in more detail below.

As way of brief background, Country Groups (i.e., A, B, D, and E) contained in Supplement No. 1 to EAR Part 740 (i) reflect each country’s export control policy, multilateral regime membership, system, and practice, (ii) generally serve as a basis for the availability of license exceptions described in part 740 of the EAR, and (iii) describe license review policy and end-user and end-use based controls under EAR Part 744.  The implications of the changes for each country are as follows:

  • Impact of Moving Ukraine from Country Group D to Country Group B:
    • Availability of More License Exceptions: Placing Ukraine in Country Group B and removing it from Country Group D, combined with Ukraine’s existing Country Groups A:2, A:3, and A:4 status means Ukraine is now eligible for certain License Exceptions, as outlined in EAR Part 740, as follows:
  • Shipments of limited value (LVS) (EAR §740.3);
  • Temporary imports, exports, reexports, and transfers (in-country) (TMP) (EAR §740.9);
  • Servicing and replacement of parts and equipment (RPL) (EAR §740.10);
  • Gift parcels and humanitarian donations (GFT) (EAR §740.12);
  • Baggage (BAG) (EAR §740.14);
  • Aircraft and vessels (AVS) (EAR §740.15);
  • Additional permissive reexports (APR) (EAR §740.16); and
  • Encryption, commodities, software, and technology (ENC) (EAR §740.17).
  • Less Restrictive Licensing Policy: Applications to export/reexport items listed on the Commerce Control List and controlled for national security (“NS”) reasons to Ukraine will no longer be subject to a case-by-case licensing, but rather will be subject to a licensing policy of approval.
  • Fewer Export Restrictions: The following restrictions no longer apply:
    • restrictions on exports/reexports of certain microprocessors for military end uses/to military end users in Country Group D:1 (EAR §744.17);
    • restrictions on certain exports/reexports to vessels and aircraft located in Ukrainian ports or registered in Ukraine (EAR §744.7); and
    • licensing requirements under General Prohibition Three for reexports of foreign-produced direct product of US-origin technology and software to Ukraine (EAR §736.2(b)(3)).

(This rule does not change the status of the Crimea Region of Ukraine under the EAR.)

  • Impact of Addition of Mexico and Cyprus to Country Group A:6

The addition to A:6 means that License Exception Strategic Trade Authorization (STA) (EAR §740.20) is available for exports, reexports, and transfer (in-country) of less sensitive items controlled for NS reasons only. This new Country Group status is in addition to Mexico’s existing Country Groups A:1, A:3, A:4, and B and Cyprus’s existing Country Groups A:3, A:4, B, and D:5 (US Arms Embargoed Countries). The fact that Cyprus remains included in Country Group D:5 means that any license review should take into account the restrictions on exports/reexports of 9×515 or “600 series” items, as set forth in paragraphs (a)(12) and (13) of EAR §740.2.


Bart McMillan leads the Chicago Office’s International Trade Compliance Subpractice within the North American International Commercial Practice. He advises US and non-US companies on international trade compliance matters arising under US export controls, trade sanctions, and antiboycott rules, as well as under US customs laws with respect to classification, valuation, country of origin, free trade agreements, and the protection of intellectual property at the US border. His practice also covers antibribery and specialized commercial compliance issues in sales and sales promotion under the US Foreign Corrupt Practices Act (FCPA), non-US antibribery law, and non-US commercial laws. Mr. McMillan has been practicing with Baker McKenzie for the entirety of his legal career, and during 2004 he was located in the Washington, DC office. He is a frequent speaker on international trade compliance matters at seminars, conferences, and company training events. While pursuing his J.D. at NYU School of Law, Mr. McMillan was Staff Editor (1997-98) and Associate Editor (1998-99), New York University Law Review; and he participated in a semester exchange to the Central European University (Budapest) (Legal Studies Dep’t).


Meghan Hamilton is a member of the International Commercial Practice Group and the International Trade Compliance Sub-Practice Group in Baker McKenzie Chicago, where she has been an associate since 2015. Meg regularly assists multinational companies on sanctions, customs and export control compliance as well as other international trade matters, including commercial agreements and anti-boycott regulations. She is active in civic activities throughout Chicago, serving on the Young Professional Board of the Center for Disability and Elder Law as well as the Auxiliary Board of the Chicago Legal Clinic.