Growing US Trade Enforcement to Continue ‘Regardless’ of Who Wins Election, Former Official Says
Both a potential Kamala Harris and a potential Donald Trump administration are likely to continue the U.S. government’s increasing focus on sanctions and export control enforcement, even if their approaches to specific trade measures may differ, such as tariffs against China or sanctions against Russia, said Adam Smith, a Gibson Dunn lawyer.
“What I'm telling clients is that there's significant differences clearly between a potential Harris and Trump administration in many, many ways, but perhaps not so much in this way,” said Smith, speaking during a webinar hosted by the law firm last week. “I think the idea of significant enforcement” will continue.
Smith, a former senior adviser to the director of the Office of Foreign Assets Control during the Obama administration, said trade enforcement has become “nonpartisan,” adding that “every president uses these tools for many reasons, good, bad or otherwise, and that's just not going to change.” He added that the recent high volume of enforcement will likely continue “regardless of who is in the White House.”
Smith and other lawyers on the call pointed to what they said have been a series of significant civil and criminal enforcement actions announced over the last few years, including a record $300 million Bureau of Industry and Security fine against Seagate in 2023 for violating U.S. export controls against Huawei (see 2304190071). Smith specifically noted that there has been a “massive growth in criminal enforcement interest and activity” during the Biden administration. That included a $1 billion settlement announced on Oct. 17 between American defense firm RTX, DOJ and the SEC (see 2410160058).
“There may be differences on the implementation with respect to Ukraine and Russia, for example,” Smith said, “but when it comes down to it, you can expect more of this, both with respect to who's listed on the various lists and who's being enforced against.”
Anna Searcey, also a trade lawyer with Gibson Dunn, pointed out that federal agencies are increasingly collaborating on enforcement, including through the joint DOJ-Commerce Department Disruptive Technology Strike Force, which has led to multiple DOJ indictments, BIS temporary denial orders and other penalties since it was formed last year (see 2302160019).
She also noted that those agencies are collaborating more closely on guidance to industry, including about sanctions due diligence and compliance risks. BIS and the Treasury Department’s Financial Crimes Enforcement Network have issued multiple joint advisories as part of an effort to collect more tips from industry about possible Russia-related sanctions or export control violations (see 2409270040).
“This type of collaboration, I think, really has the potential to cut both ways,” Searcey said. “On the one hand, more guidance means more clarity and potentially a streamlining of compliance for the private sector. But on the other hand, more collaboration can quickly turn to more enforcement and more enforcement risk.”