China will require import and export licenses for certain commercial encryption products beginning Jan. 1, its Commerce Ministry said in a Dec. 2 notice. The license requirements, to be overseen by the Commerce Ministry and China’s customs authority, are aimed at monitoring and restricting the trade of dual-use encryption technologies, the notice said, according to an unofficial translation. The export requirements could capture equipment that uses commercial encryption for electric utilities and finance, Nikkei reported Dec. 3, while import controls could capture phone and fax machines with encryption features. Violators could face penalties outlined under China’s new export control law, which took effect Dec. 1 (see 2010190033).

The Bureau of Industry and Security corrected its September revision of the Export Administration Regulations, which implemented export control changes made by the 2018 Wassenaar Arrangement plenary (see 2009100027). The corrections, issued in a notice released Dec. 3, address errors that were “unintentionally introduced” in Export Control Classification Numbers 3A001, 3A002, 3A991, 5A002, 7A005 and 9E003, BIS said. It said the corrections do not change BIS policy or affect licensing requirements.

House Ways and Means Committee member Stephanie Murphy, D-Fla., said that although “the politics of trade are fairly tricky,” she feels confident in saying “things can't get any worse” for free trade during the Biden administration. Murphy, one of two members of the House speaking on a Cato Institute webinar about what to expect in trade with a new president, said she's encouraged by President-elect Joe Biden's choices for the secretaries of the treasury and state, and the head of the National Security Council, because all of the individuals recognize that trade is an important tool in foreign policy.

The Office of Foreign Assets Control sanctioned Shahid Meisami Group and its director, Mehran Babri, for their involvement in Iranian chemical weapons research, OFAC said Dec. 3. The agency said Shahid Meisami Group works under the U.S.-sanctioned Iranian Organization of Defensive Innovation and Research, known as SPND, and is responsible for “numerous” government projects, including the production of chemical agents. The U.S. says SPND works on the Iranian regime’s proliferation of weapons of mass destruction.

The Justice Department plans to announce more indictments involving cases of Chinese technology theft before the Joe Biden administration takes over in January, top U.S. security officials said. Under the agency’s China initiative (see 2008130036), the U.S. has targeted and arrested Chinese nationals for trying to steal export-controlled technology, an effort that has resulted in more than 1,000 Chinese researchers leaving the country since July, said John Demers, the U.S. assistant attorney general for national security.

The World Customs Organization issued the following releases on commercial trade and related matters:​​

The United Kingdom Dec. 2 published guidance for European Union companies importing from or exporting to the U.K. after Brexit. The U.K. also issued guidance on how tariffs and taxes will apply to EU businesses. The guidance has information on trading animal products, plant products, energy-related goods, manufactured goods, chemicals, controlled goods and other items. The U.K. stressed EU companies should review import procedures with their country’s customs authority before importing U.K. products next year, and said EU exporters will need to follow “new traffic management processes at ports to avoid delays.”

The European Parliament released a November report on extraterritorial sanctions and their “legality under general international law.” The report includes an overview of U.S. sanctions and their impacts on the EU and member states -- including U.S. designations on Iran, Cuba and the Nord Stream 2 project (see 2007150021) -- and how the EU can protect itself against those impacts. The report recommends that the EU help European companies find “recourse” through arbitration and national courts and to consider challenging the legality of some U.S. sanctions through the World Trade Organization’s dispute settlement system. The EU should also consider countermeasures to U.S. sanctions, the EP said, but stopped short of asking the EU to follow through with those measures. “At this stage, the application of such measures could hardly be recommended,” the report said. “However, it might be helpful to clearly state that the EU is aware of this option and will consider it.”

The European Union's equivalent of secretary of state is calling for coordination with the U.S. on regulatory conformity, choosing a new director-general at the World Trade Organization and restoring the appellate body there, in a policy paper released Dec. 2. High Representative of the Union for Foreign Affairs and Security Policy Josep Borrell Fontelles said they need to intensify trilateral work between the EU, Japan and the U.S. on how to address market-distorting practices that WTO rules aren't effective in addressing. “We should also work together to bring forward the WTO e-commerce negotiations,” he said.

The State Department approved six potential military sales to South Korea, Brazil, Canada, Saudi Arabia, Lebanon and Croatia worth a combined $1.54 billion, the Defense Security Cooperation Agency said Dec. 1. Under the proposed sales, South Korea would get two “MK 15 MOD 25 Phalanx Close-In Weapons System Block 1B Baseline 2 systems” worth about $39 million. Raytheon Missile and Defense will be the principal contractor. The sale to Brazil includes “MK 54 Lightweight Torpedoes” for $70 million. Raytheon Integrated Defense System will be the principal contractor. Canada would get $275 million worth of “C-17 Sustainment and related equipment.” The principal contractor will be Boeing. Saudi Arabia would receive about $350 million worth of “technical assistance and advisory support” for its defense ministry for an additional five years. The sale does not have an associated prime contractor. Lebanon would get 300 “M1152 High Mobility Multi-purpose Wheeled Vehicles” worth about $55.5 million. The principal contractor will be American General. The sale to Croatia includes 76 “M2A2 Operation Desert Storm (ODS) Bradley Fighting vehicles” worth about $757 million. BAE Systems and Raytheon Missile Systems will be the prime contractors.