Proposed U.S. guardrails around the Chips Act aren’t likely to stop semiconductor companies from applying for funding, Michael Schmidt, the Commerce Department official in charge of the program, said this week. While Semiconductor Industry Association CEO John Neuffer agreed, he also urged the government to coordinate any chip-related restrictions with trading partners or risk U.S. companies losing Chinese market share, calling the idea of decoupling a “protectionist fairy tale.”

The Bureau of Industry and Security announced the launch of a formal process to coordinate with certain allies on export enforcement efforts, an effort the agency’s Office of Export Enforcement has been working on for months. BIS said the “partnership” -- agreed to with the fellow Five Eyes partners Australia, Canada, New Zealand and the U.K. during a meeting in Canada this week -- will leverage each country’s resources to expand enforcement “capacity” and better “prevent and deter evasion of export controls,” BIS said.

Republican presidential candidate Nikki Haley said she would block all exports of sensitive technology to China and put in place new investment restrictions on Chinese purchases of agricultural land if she is elected to the White House. Haley, the former U.N. ambassador during the Trump administration who announced her 2024 presidential candidacy earlier this year, said President Joe Biden is “not up to the task” of protecting U.S. national security from risks posed by China and previewed several new policies that could cut off a range of trade between the two countries.

Chip company ASML Netherlands may refuse job applicants who may not be able to comply with U.S. export regulations, an independent Netherlands human rights monitor ruled this month, saying the refusal doesn't violate Dutch anti-discrimination laws. The monitor said ASML is justified in not hiring applicants from certain countries to positions where they could access U.S.-controlled dual-use technologies, according to an unofficial translation of the judgment, otherwise ASML could face “major risks of sanctions” from the U.S.

The U.S. should launch a new office within the Bureau of Industry and Security to measure the intended and unintended impacts of export controls on global supply chains before they are implemented, technology policy experts said in a new Atlantic Council report this week. This could help the U.S. better calibrate its trade restrictions so they don’t alienate allies and hurt American competitiveness, the report said, and could ultimately better convince trade partners to join in on the controls.

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The EU is preparing to revamp its dual-use export control regime to better target emerging technologies, said Jean-Charles van Eeckhaute, a senior European Commission official. Van Eeckhaute said the commission already has begun work on a new list of dual-use technologies -- which the bloc hopes to finalize by September -- that may warrant new restrictions.

The EU levied its 11th sanctions package against Russia June 23, imposing a host of new export restrictions, individual designations and "new tools to counter circumvention and information warfare," the European Council announced. The new designations target 71 people and 33 entities involved in military activities, political decision-making, the spread of disinformation, the forced adoption of Ukrainian children to Russia and Russian information technology companies offering technology to Russian intelligence agencies.

China’s recent restrictions on Micron products are having broader than expected consequences for U.S. exporters, a trade industry conference heard last week, and may portend how future Chinese retaliatory actions will affect U.S. companies.

Many companies are grappling with how best to comply with the Commerce Department’s foreign direct product rule, “one of the key areas” still “unaddressed” by the agency’s regulations and guidance, said Kim Strosnider, a trade lawyer with Covington. She said Commerce’s compliance expectations for the FDP rule are rising despite due diligence challenges faced by industry, pointing to the agency’s record $300 million penalty against Seagate Technology in April (see 2305080029 and 2304190071).