A U.S.-based technology company “likely” violated U.S. export controls against Huawei for more than a year but hasn't yet faced penalties by the Bureau of Industry and Security, Republican staff on the Senate Commerce Committee said Oct. 26. The committee’s minority staff said Seagate Technology likely continued shipping hard disk drives to Huawei after BIS amended its foreign direct product rule last year, which imposed controls on goods that are the direct product of certain technology or software subject to the Export Administration Regulations (see 2005150058 and 2008170029).
The Commerce Department needs to address several “urgent shortcomings” in its export control policies toward China (see 2110180016) and impose stricter export restrictions and license denials for sensitive goods and suppliers of Chinese military companies, a group of Republican lawmakers said in a letter to Secretary Gina Raimondo. The 17 Republicans, all members of the House’s China Task Force, also said the Bureau of Industry and Security should commit to a timeline for releasing more emerging and foundational technology controls and issue “appropriate” restrictions on fundamental research and open-source technology platforms.
The Bureau of Industry and Security is seeking feedback on potential export controls for brain-computer interface (BCI) technologies, which may be added to the Commerce Control List as an emerging technology and face new restrictions and license requirements. The agency is specifically seeking comments on whether feasible and effective controls can be imposed on BCI technologies, which include “neural-controlled interfaces, mind-machine interfaces, direct neural interfaces and brain-machine interfaces,” according to an advance notice of proposed rulemaking. Comments are due Dec. 10.
The Department of Justice may issue severe penalties in the future for foreign hacking that violates U.S. export controls despite the “lenient” deferred prosecution agreement it announced in September (see 2109150031), national security lawyers said. Companies shouldn't expect that case to signal the start of a trend of minor penalties for hacking, the lawyers said, and should be especially cautious before providing cyber services to foreign governments.
The Treasury Department expects to issue more crypto-related sanctions and allocate more resources to better target the digital assets of cybercriminals, Treasury Deputy Secretary Wally Adeyemo said. Speaking during a Center for a New American Security Event event last week, Adeyemo also said the agency is placing a high priority on multilateral designations and is hoping to better understand trading partners’ concerns about U.S. secondary sanctions.
Export controls may prevent some hurdles in the investment and development of emerging quantum computing technologies, the Government Accountability Office said in an Oct. 19 report. Controls may limit some U.S. trade, prevent U.S. quantum technology companies from collaborating with other countries and deter U.S. firms from employing highly skilled foreign workers, the GAO said.
The Bureau of Industry and Security approved more than a combined $100 billion worth of export licenses for shipments to Huawei and Chinese top chipmaker SMIC from November 9, 2020, through April 20, 2021, according to documents released Oct. 21 by the House Foreign Affairs Committee. BIS said it approved 113 licenses for Huawei -- about 70% of the total license applications it received -- for more than $61 billion worth of goods during that time period. The agency also approved 188 licenses for SMIC -- about 90% of the total it received -- for more than $41 billion worth of exports.
The Bureau of Industry and Security is proposing to clarify and expand restrictions on using License Exception Strategic Trade Authorization (see 2109130013), which it hopes will reduce exporter “confusion” and better control certain sensitive technologies, BIS said Oct. 21.
Tariffs imposed on goods from China during the previous administration likely contributed to the ongoing chip shortage, though an increasing demand and port congestion are bigger factors, Commerce Secretary Gina Raimondo and Sen. Todd Young, R-Ind., said. Speaking during an Oct. 20 event hosted by The Washington Post, both underscored the severity of the supply chain crisis and said lawmakers should move faster to pass legislation that would provide more funding to the semiconductor industry.
The Bureau of Industry and Security will issue new export controls on certain cybersecurity items and create a new license exception for those exports, BIS said in an interim final rule released Oct. 20. The rule, which will align U.S. cybersecurity restrictions with controls previously agreed to at the multilateral Wassenaar Arrangement, will establish more restrictions on certain items that can be used for “malicious cyber activities” by imposing a license requirement for shipments to certain countries, BIS said. The changes take effect Jan. 19, and BIS will accept public comments until Dec. 6.