U.S.-China tensions and trade restrictions have had a “chilling effect” on research and technology collaboration between the two countries, resulting in slower advancements in some scientific fields, according to a report last week from the Center for Strategic and International Studies and Stanford University's Center on China's Economy and Institutions. The report predicts that more U.S. policies “restricting collaboration” are likely. “[I]f export controls and restrictions on technology sharing in fields such as biotech are introduced by the executive branch, they could have significant repercussions for universities and researchers,” the report said.

The State Department’s Directorate of Defense Trade Controls completed an interagency review for a final rule related to certain license exemptions for allies. The rule, received by the Office of Information and Regulatory Affairs Dec. 2 and completed Dec. 8, would amend the International Traffic in Arms Regulations’ Supplement No. 1 to Part 126 “in support of allies.” DDTC in July announced an open general license pilot to authorize reexports and retransfers of certain defense items and services to Australia, Canada and the U.K. (see 2207190008).

The Bureau of Industry and Security again (see 2209120002) sent a final rule for interagency review that could implement certain export control decisions agreed to at the multilateral Australia Group and place new controls on certain marine toxins, plant pathogens and biological equipment. BIS sent the rule to the Office of Information and Regulatory Affairs Dec. 7 after previously sending it to OIRA Sept. 9, where it was completed with some changes (see 2209120002). The rule, if published, could finalize May proposed controls on four dual-use biological toxins that BIS said can be weaponized to kill people or animals.

A deal between the U.S. and the Netherlands on new export controls for chipmaking equipment destined for China could come as soon as next month, Bloomberg reported Dec. 7. The U.S. has been working to convince the Dutch to impose similar semiconductor export controls and restrict the ability of Netherlands-based ASML to provide certain advanced equipment to China (see 2211210035). The report said it remains unclear what the potential U.S.-Dutch agreement would mean for ASML’s China sales. Bureau of Industry and Security Undersecretary Alan Estevez said Dec. 7 that he remains confident the U.S. will convince allies to impose harsher restrictions against China, and said he respects the Netherlands’ desire to shape its own export control policies (see 2212060059).

The Bureau of Industry and Security's additions to the Entity List this week shows the agency is “constantly monitoring, assessing, and acting to prevent items subject to U.S. law from being diverted to malign purposes,” Undersecretary Alan Estevez said in a press release published by BIS Dec. 8. The agency this week added 24 companies to the Entity List for participating in illegal exports to aid Russia’s military, supply export-controlled items to Iran or support Pakistan’s nuclear activities (see 2212070022).

The State Department’s Directorate of Defense Trade Controls published in the Federal Register this week its temporary suspension of certain export license requirements for certain capacitors described in the U.S. Munitions List. The suspension, announced last month (see 2211230030), will last for six months and could allow DDTC to better “facilitate” commercial transactions involving the capacitors, including for the energy exploration and aviation sectors.

The Bureau of Industry and Security extended the comment period for its recently announced chip export controls against China, saying it wanted to give more time for commenters to review the October rule and submit their feedback. Comments were originally due Dec. 12 (see 2210070049) but will now be due Jan. 31, BIS said in a notice released Dec. 5. The new controls, designed to restrict China’s ability to acquire advanced computing chips and manufacture advanced semiconductors, have posed challenges for some in the semiconductor industry and sparked calls for additional guidance (see 2211010042 and 2211150044).

The Wassenaar Arrangement last week published export control changes agreed to by member states during the 2022 plenary, including updated versions of due diligence best practices and a list of commonly used end-user assurances. The changes include new controls for a range of technologies, including supersonic flight technology and “rim-driven motors for submarine propulsion,” the plenary chair said in a statement. The group also updated existing controls on high-performance computers and lasers; exchanged information on transfers of dual-use goods; and shared “experiences in national export control implementation,” enforcement and licensing.

The Bureau of Industry and Security is seeking public comments on priorities for export control cooperation with Japan, the agency said this week. BIS said the comments will help inform work under the Japan-U.S. Commercial and Industrial Partnership's Export Control Working Group, including efforts to ensure the two countries’ dual-use controls are “more transparent, more efficient and effective, and more convergent.” BIS said comments also will help the group identify and control emerging and foundational technologies and better enable collaboration between U.S. and Japanese research organizations.

Baidu, a major Chinese artificial intelligence company, said it doesn’t expect to be severely impacted by the U.S.’s new China-related chip controls. Speaking during a Nov. 22 earnings call, Executive Vice President Dou Shen said the impact of the restrictions will be “quite limited in the near future,” adding that a “large portion” of its AI cloud business “and even wider AI business does not rely too much on the highly advanced chips.” The company also has “already stocked enough in hand” for “the part of our businesses that needs advanced chips.”