The Treasury Department is likely to release its draft outbound investment regulations in the next several months, setting them up to potentially take effect before year's end, said foreign investment lawyer Jonathan Gafni of Linklaters.
Ian Cohen
Ian Cohen, Deputy Managing Editor, is a reporter with Export Compliance Daily and its sister publications International Trade Today and Trade Law Daily, where he covers export controls, sanctions and international trade issues. He previously worked as a local government reporter in South Florida. Ian graduated with a journalism degree from the University of Florida in 2017 and lives in Washington, D.C. He joined the staff of Warren Communications News in 2019.
The U.K. government faced pressure from Parliament this week about whether it failed to sanction companies owned by Iran’s state-backed petrochemicals firm, allowing it to evade western restrictions by maintaining accounts with at least two London banks. Members of Parliament called for an investigation and said the government may need more sanctions enforcement resources.
The Treasury Department has been too slow to propose regulations for a congressionally mandated sanctions whistleblower program, a group of bipartisan senators said this week, calling the agency’s lack of progress “unacceptable.”
The Bureau of Industry and Security should get a “significant” funding boost next year so its export control authorities can keep pace with emerging technologies and so its enforcement branch can continue increasing penalties on violators, the top Democrats on the Senate Banking Committee said this week.
Technology companies, trade groups, think tanks and researchers urged the government to be cautious as it evaluates its semiconductor-related export controls and prepares new ones, warning that misguided restrictions could cede American technology leadership to China, hurt the competitiveness of U.S. companies and raise the complexity of an already fraught compliance landscape.
The U.S. may need to take stronger export control actions to stifle Chinese progress in artificial intelligence, including broader semiconductor-related restrictions, a U.S. congressional commission heard this week. But the commission was also warned about the dangers of overly broad controls on more emerging technologies, such as quantum, which experts said could hurt instead of help U.S. competition with China.
A new executive order signed this week allows the U.S. to sanction "foreign persons" responsible for an increase in violence in the West Bank. The order, signed by President Joe Biden Feb. 1, was announced alongside sanctions against four Israelis that recently carried out attacks against Palestinians and a new Treasury Department guidance alerting banks about how they can prevent the financing of violence in the region.
The U.S. and the EU are continuing to prioritize export control and sanctions enforcement against Russia, said Valdis Dombrovskis, the European Commission’s top trade official, and he suggested the EU may soon issue penalties against companies for evading the bloc’s sanctions. He also said the two sides are working on ways they can both put in place new export controls proposed at consensus-based multilateral regimes, such as the Wassenaar Arrangement, even if they are blocked by Russia.
The Bureau of Industry and Security reached a $153,175 settlement with Wabtec, a U.S. rail technology manufacturer and supplier, after the company violated BIS’ antiboycott regulations. The agency said Wabtec committed 43 violations when it failed to report to BIS that it received requests from a Pakistani customer to boycott goods from Israel.
C-suite officials need to be more involved in their companies’ export compliance programs, the Bureau of Industry and Security’s top export enforcement official said this week. He also urged businesses to review -- and potentially expand -- their current programs to keep pace with export controls risks, especially as various government agencies work more closely together on investigations, indictments and sanctions.