The Commerce, State and Justice departments fined an American 3D printing company more than $25 million combined after it committed a range of export violations, including illegal shipments of aerospace technology and metal alloy powder to China and controlled design documents to Germany.
South Korean chip companies are dealing with significant “uncertainty” stemming from U.S. chip controls issued in October against China (see 2210070049) and are concerned about the looming expiration of a one-year authorization from the Commerce Department, a Korean economic security expert said last week. Although Bureau of Industry and Security Undersecretary Alan Estevez said the agency is working with Korean companies on potentially extending certain aspects of the authorization, details of those conversations remain unclear.
The U.S. announced a new, sweeping set of export controls and sanctions last week to further hobble Russia on the one-year anniversary of its invasion of Ukraine, including additions to the Entity List, an expansion of industry sector restrictions on both Russia and Belarus, new export controls against Iran to address its drone transfers to Russia, and new financial sanctions against more than 100 people and entities. Many of the measures, which were announced alongside similar actions by U.S. G-7 allies, aim to “cut off the Russian defense industrial base and military from even low-technology consumer items,” the Bureau of Industry and Security said.
The Bureau of Industry and Security announced a range of updates to its export regulations stemming from agreements made during the 2021 Wassenaar Arrangement plenary meeting, including revisions to the Commerce Control List and the license exceptions Adjusted Peak Performance (APP) and Strategic Trade Authorization (STA). The agency also made several corrections to the Export Administration Regulations, including to align the scope of its Significant Item (SI) license requirements throughout the EAR.
House Foreign Affairs Committee Republicans are asking the Bureau of Industry and Security for information on its export enforcement and compliance efforts involving China, including steps to crack down on Chinese transfers of controlled U.S. technology to State Sponsors of Terrorism (SSTs). In a letter sent to BIS last week, Rep. Michael McCaul of Texas, chair of the committee, said he is concerned China’s “economic and trade ties” with terrorism sponsors is “undermining U.S. national security and foreign policy interests.” He and Rep. Michael Lawler, R-N.Y., asked BIS to provide information on recent Chinese export violations, licensing procedures, end-use checks and more by March 2.
As U.S. government regulators continue to face pressure from Congress to more quickly place export restrictions on emerging technologies, the Commerce Department and industry officials are grappling with the potential ethical consequences of controls on a technology that could have groundbreaking medical benefits.
The Commerce Department and DOJ this week launched a new task force to “target illicit actors” and protect critical technologies from being acquired by “nation-state adversaries.” The Disruptive Technology Strike Force -- which will be led by Commerce’s Bureau of Industry and Security and DOJ’s National Security Division -- will focus on investigating and prosecuting criminal export violations, improving “administrative enforcement” of export controls, coordinating law enforcement actions and “disruption strategies” with U.S. allies and more.
The Commerce Department is trying to find a way to screen outbound investments in a way that protects domestic commercial interests but limits collateral damage to businesses with interests outside the U.S., said Marisa Lago, the agency’s undersecretary for international trade. Lago’s comments came one day after Samm Sacks, an expert on U.S.-China technology policy issues, said the Biden administration hasn’t yet released an executive order to create an outbound investment screening regime because of discussions surrounding implementation challenges.
The Biden administration’s implementation of its new China chip export controls (see 2210070049) has been “mixed,” and it remains unclear how far allies will go to impose similar restrictions, said Clete Willems, who was a National Security Council official during the Trump administration. Willems, in written testimony this week to the House Financial Services Committee, said he doesn’t understand why the administration didn’t initially coordinate the October export control rule with allies, a shortcoming that could be hurting U.S. companies now.
The Commerce Department’s Bureau of Economic Analysis recently announced a mandatory quarterly survey of foreign direct investment in the U.S. The agency will collect the data to “measure the size and economic significance of foreign direct investment in the United States and its impact on the U.S. economy,” BEA said. Reporting is mandatory for each U.S. business in which a foreign person has a “direct and/or indirect ownership interest of at least 10 percent of the voting stock in an incorporated business enterprise, or an equivalent interest in an unincorporated business enterprise, and that meets the additional conditions detailed in Form BE-605.” Reports are due to BEA “30 days after the close of each calendar or fiscal quarter, or 45 days if the report is for the final quarter of the financial reporting year.”