A new State Department export license exemption for underwater drones provides “new flexibility” for companies using those drones for certain commercial and scientific operations, but companies still need to set “careful compliance guardrails” to make sure they’re using the exemption correctly, K&L Gates said in a client alert.
The State Department began an interagency review Sept. 11 for a final rule involving an exemption within the International Traffic in Arms Regulations for defense trade between the AUKUS nations of Australia, U.K. and the U.S. The rule could build on the agency's August 2024 interim final rule that created the exemption and aimed to remove certain export control barriers for a range of items that had previously faced strict license requirements under the ITAR (see 2408160019).
Former U.S. trade representative Michael Froman, at an event hosted by the centrist think tank Brookings Institution, said deciding how to apply export controls is "really difficult," and quite technical, as technologies evolve.
The Bureau of Industry and Security has completed a round of interagency review that would revise Biden-era regulations that increased restrictions on firearms exports. The rule, sent for a review Aug. 4 and completed Sept. 10, is expected to reverse some of those restrictions amid lobbying from gun industry advocates (see 2505290012 and 2506050050).
The State Department this week issued a minor correction to last month's final rule that will add and remove items on the U.S. Munitions List and clarify the control scope of others (see 2508260011). The agency said “an asterisk was inadvertently omitted from the amendatory text.”
The State Department's Directorate of Defense Trade Controls will again renew relaxed export restrictions for certain defense goods and services involving Cyprus, it said in a final rule released this week and effective Oct. 1. The agency has issued the renewal each year since 2020 (see 2309130028), suspending its policy of denial for exports, reexports and transfers of defense articles on the U.S. Munitions List to Cyprus. The move also suspends the policy of denial for retransfers and temporary imports destined for or originating in Cyprus and brokering activities involving Cyprus. The latest renewal expires Sept. 30, 2026.
Although the Bureau of Industry and Security published a rule last month to ease certain export controls on Syria (see 2508280029), it also “retained significant parts” of its long-standing restrictions against the country, which could create new compliance challenges for some exporters, Troutman Pepper said in a client alert.
H.R. McMaster, former national security adviser during the first Trump administration, said he disagrees with the government's plan to approve exports of Nvidia's advanced H20 chips to China (see 2508220003) and hopes the administration soon develops a more coherent economic security strategy.
The U.S. isn't doing enough to compete with China on technology, partly because of its failure to meaningfully restrict outbound investments and its willingness to let American companies continue to sell advanced chips to China, said Derek Scissors, a senior fellow at the American Enterprise Institute.
The Bureau of Industry and Security is working on an interim final rule that it said would streamline its export restrictions for drone exports. The agency sent the rule for interagency review on Aug. 21. BIS didn't release more information.