The European Union won’t hesitate to push back on U.S. extraterritorial sanctions but wants to work more closely with the Biden administration on sanctions programs to ease compliance burdens for EU companies, a top EU official said. “There is no better way to protect against extraterritorial sanctions than to align sanctions implementation with partners like the United States,” said Mairead McGuinness, an EU commissioner overseeing financial markets.
Sen. Tom Cotton, one of the most prominent China hawks in Congress, thinks that the Bureau of Industry and Security is buried within an organization “hostile to the aggressive use of export controls,” and so it should be moved from the Commerce Department to the State Department, because, he says, that department puts national security first. Cotton, who has published a lengthy report on what he calls the economic long war with China, discussed his views during an online program at the Reagan Presidential Foundation on Feb. 18.
Although President Joe Biden told a Feb. 16 CNN town hall that there will be more “repercussions” for China’s human rights violations in the Xinjiang region, the White House declined to say whether that includes more sanctions. “As it relates to our policy toward China, we are not in a rush,” White House Press Secretary Jen Psaki said Feb. 17. Psaki said Biden is “focused on communicating and working with our partners and allies around the world” and has had a “number of conversations” with European allies about potential next steps. “There's an ongoing policy process and I don't have anything to preview,” Psaki said.
House lawmakers in both political parties wrote to ask the State Department to provide a briefing on the agency’s implementation of sanctions against Nord Stream 2 and further steps the U.S. can take to block work on the Russian gas pipeline (see 2101190018). The members specifically asked for an update on the State Department’s “assessment of possible sanctionable activity” by vessels working on the pipeline, which companies are complying with the 30-day wind-down period the U.S. offered on sanctionable activity, the status of talks with allies and any proposals offered to the Biden administration to persuade the U.S. to forgo the sanctions.
The Bureau of Industry and Security have outlined a series of increased restrictions on exports to Myanmar, including a more strict licensing policy and the suspension of certain license exceptions. The changes, described by the Commerce Department last week and effective Feb. 18, came after President Joe Biden authorized sanctions and ordered stronger export controls for shipments to the country’s military after it overthrew the government earlier this month (see 2102110020).
Although national security lawyers aren’t expecting many changes to the goals of the Committee on Foreign Investment in the U.S. under the Biden administration (see 2101220034), they are expecting more of an effort by CFIUS to keep its transactions and actions out of the spotlight. “We do expect to see a return to a normal course of business for CFIUS, for the deliberations to take place behind closed doors,” said Caroline Brown, a trade lawyer with Crowell & Moring, speaking during a Feb. 17 event hosted by the law firm.
China is looking into the prospect of placing export controls on rare earth minerals crucial for the manufacture of U.S. F-35 fighter jets and other crucial weaponry, according to a report in The Financial Times. The details of the proposed controls come a month after China's Ministry of Industry and Information Technology proposed draft controls on the production and export of 17 rare earth minerals in China -- the country that controls about 80% of global supply. “The government wants to know if the US may have trouble making F-35 fighter jets if China imposes an export ban,” said a Chinese government adviser who asked not to be identified.
The State Department’s Directorate of Defense Trade Controls on Feb. 17 released its notifications to Congress of recently proposed export licenses. The 34 notifications, from July through September, feature arms sales to numerous countries including the United Kingdom, Israel, Australia, Canada, Germany, Italy and Pakistan.
Rep. Michael McCaul, R-Texas, said the Bureau of Industry and Security isn’t complying with congressional oversight requirements because it hasn’t yet provided him with information about its China licensing process that he requested in November. After McCaul requested “detailed information” on how BIS licenses U.S. technology to Chinese entities, BIS told him the data was “too difficult and time-consuming to compile,” McCaul said Feb. 16. But McCaul said BIS allowed “the same information to be shared with the media,” referencing a Feb 11 Reuters report on Huawei restrictions (see 2102120008). McCaul called BIS’s actions “completely inappropriate and only furthers my concerns that BIS has not woken up to the growing threat of the Chinese Community Party.” A BIS spokesperson didn’t comment.
The United Nations special rapporteur for human rights called on the U.S., the European Union and other countries to lift their unilateral sanctions against Venezuela, saying the measures are disproportionately affecting innocent civilians, nongovernmental organizations and third-country companies. U.S. sanctions are having an especially “severe” impact, the official, Alena Douhan, said Feb. 12. The restrictions are impeding the flow of humanitarian aid as well as “necessary machinery” and essential goods such as electricity, water, fuel and food. “The devastating effect of sanctions imposed is multiplied by extra-territoriality and over-compliance adversely affecting” Venezuela, Douhan said, adding that she plans to issue a comprehensive report on the sanctions in September.