Technology academics and industry officials this week cautioned Congress about potential U.S. export controls over quantum technologies and research, saying new restrictions without clear guidance could hamper U.S. competitiveness and innovation. But one current government official suggested the administration needs to be more “proactive” in protecting the most sensitive research from being stolen.
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.S. announced new sanctions this week against people and entities in China, Hong Kong and Iran for helping Iran procure “sensitive and critical parts and technology” for its ballistic missile programs. The “network” has also helped the Iranian government conduct financial transactions in support of its missile development efforts and aided the country’s Ministry of Defense and Armed Forces Logistics (MODAFL), as well as other affiliated procurement organizations, the Office of Foreign Assets Control said.
The U.S. should push the World Trade Organization to end trade-related intellectual property waiver conditions, experts told a House subcommittee this week, saying the waiver may help China acquire sensitive U.S. technologies and leapfrog American innovation in biopharma. Several experts during the hearing suggested the waivers could act as a loophole to U.S. export controls and allow Chinese companies to better compete with the U.S. in the biotechnology industry.
The U.S. and its allies should tighten export restrictions on artificial intelligence technologies destined to China, said Rep. Michael Waltz, R-Fla.. Waltz, speaking during a June 5 event hosted by the Atlantic Council, said America and its close trading partners need to “collaborate and innovate within a bubble that can be protected,” adding that cutting off technology trade with China will be inevitable. “I just don't see a way forward without decoupling,” he said.
The Bureau of Industry and Security again renewed the temporary denial order (TDO) for three U.S. companies for their involvement in illegally exported technical drawings and blueprints to China (see 2206080068) after continuing to find evidence of additional potential export violations. The order, originally issued June 8, 2022, before being renewed in December (see 2212080007), was renewed for another 180 days on June 1, BIS said.
The Committee on Foreign Investment in the U.S. is open to working with lawmakers on a bill that could block China, Russia, Iran and North Korea from investing in American land or agricultural companies, said Paul Rosen, the head of CFIUS. While Rosen didn’t explicitly endorse the Promoting Agriculture Safeguards and Security Act, suggesting that CFIUS would need more resources if its jurisdiction were broadened, he said the legislation raises valid concerns.
Heightened expectations for cooperation under DOJ’s new corporate enforcement policies present a range of challenges for companies considering whether to submit voluntary disclosures, particularly because the agency’s interpretation of “extraordinary cooperation” is so ambiguous, lawyers said. They also said DOJ’s threshold for “full cooperation” -- a step below extraordinary cooperation -- can sometimes be too difficult to meet.
The Bureau of Industry and Security has seen a recent spike in completed end-use checks in China after years of dormancy, which has allowed the agency to verify controlled items went to their intended destination, said Matthew Axelrod, top export enforcement official at BIS. Axelrod, speaking during a Senate Banking Committee hearing this week, said the agency has completed more than 90 checks in the last seven months, a stark turnaround from a government in China that hadn’t “scheduled a single end-use check for us in over two years.”
The U.S. this week issued its first set of Sudan sanctions since a May executive order expanded U.S. sanctions authority against the country (see 2305040037), designating four companies, including its largest defense firm, earning revenue or contributing to Sudan’s ongoing military conflict. The designations, announced June 1 by the Office of Foreign Assets Control, include four new general licenses to authorize certain essential transactions, including for humanitarian aid.
Lawmakers this week previewed two bills that could expand U.S. export controls, including one that could require the U.S. to impose new license requirements on certain data exports and another that would require the administration to create a tool to counter economic coercion.