Unclear How New BIS ECRA Approach Will Affect Controls, Law Firms Say
It’s unclear whether the Bureau of Industry and Security's decision to stop differentiating between emerging and foundational technologies under the Export Control Reform Act (see 2205200017) will have any real impact on export controls, law firms said. Torres Trade Law said this month that “only time will tell” if the change allows BIS to impose the controls more quickly, but companies should closely monitor the pace of upcoming restrictions, especially if they’re dealing in “cutting-edge technologies.”
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BIS announced the change in May, saying the effort to designate critical technologies as either “emerging” or “foundational” has delayed controls and led to interagency disagreements. If the change reduces the number of disagreements, Morrison & Foerster said, companies may start seeing an “uptick” in export controls. But it “remains to be seen whether this change facilitates timelier implementation of appropriate controls,” the firm said.
More export controls also could lead to more transactions triggering mandatory filings with the Committee on Foreign Investment in the U.S., which can review any transactions involving critical technologies (see 2106020024 and 2109030039), the firm said in a June alert. The firm said the change also may “prompt” Congress to move forward with new outbound investment controls (see 2206290035 and 2207060030).