G-7 trade ministers stressed the importance of export controls this week and said they will continue to work together to counter evasion tactics. The countries, including the U.S., Japan, Germany, the U.K., France, Italy and Canada, said export controls are a “fundamental policy tool to address the challenges posed by the diversion of technology critical to military applications,” adding that they “continue to work with other states” to strengthen the restrictions.
Japan recently loosened export restrictions on shipments of hydrogen fluoride, fluorinated polymide and resists to South Korea following the end of a long-running trade dispute between the two countries. Japan's Ministry of Economy, Trade and Industry said it added the three items, which are high-tech materials used in smartphone displays and chips, to the scope of its "Special General Bulk Export License system," effectively lifting the restrictions. The announcement, which took effect March 23, comes after South Korea withdrew its dispute complaint at the World Trade Organization (see 2303240044 and 2303170015).
The Bureau of Industry and Security is preparing new proposed export controls on automated peptide synthesizers, building off a September advanced notice of proposed rulemaking (see 2209120021). The agency sent the proposed rule for interagency review March 29.
The Biden administration will soon announce a new “code of conduct” to improve export controls on goods and technology that could be used for human rights abuses, an effort being rolled out as part of the second Summit for Democracy this week, a senior administration official said during a March 29 call with reporters. The code, which the U.S. said it was “working to develop” during the first democracy summit in 2021 (see 2112090030), “commits subscribing states to better integrate human rights criteria in their export control regimes,” the White House said in a fact sheet.
U.S. defense export regulations are the “biggest speed bump” and need to be addressed to foster closer technology collaboration between the U.S. and allies, former Navy Secretary Richard Spencer said this week. Spencer, speaking at the National Press Club of Australia, said the International Traffic in Arms Regulations “has to be addressed; it will be addressed,” according to a March 20 report from InnovationAus.
The Defense Department is proposing a regulatory revision that would require certain contractors to provide their export authorizations to the Defense Contract Management Agency. The change would revise the Defense Federal Acquisition Regulation Supplement to require contractors to provide the agency with export license exemptions, export license exceptions, export licenses or other approvals when the contract “requires government quality assurance surveillance oversight and has delivery to, or production or performance in, government quality assurance countries,” the rule said. Comments are due May 22.
The U.S should build a new international technology task force to increase technology trade cooperation with allies, the German Marshall Fund said in a report this week. The report, authored by GMF technology policy experts Karen Kornbluh and Julia Trehu, said the task force could focus on semiconductors, green technologies and critical minerals, and would allow members to share supply chain data and “provide a venue for countries to reconcile export controls.”
The U.S. and India last week launched the India-U.S. Strategic Trade Dialogue to discuss “export controls, explore ways of enhancing high technology commerce, and facilitate technology transfer between countries,” the Commerce Department said. The effort will be led on the U.S. side by the Bureau of Industry and Security, Secretary Gina Raimondo said. “This is exciting because it’s an official government-to-government arrangement where we’re going to deepen our engagement with India, specifically around the area of aligning our export controls and sharing our information with one another.”
The U.S. is planning more export restrictions on semiconductor manufacturing items destined to China and could publish them as early as next month, Bloomberg reported March 10. The new restrictions could “double the number of machines” that require export licenses, the report said, placing new controls on Applied Materials and other chip equipment makers. The Biden administration plans to coordinate the new restrictions with the Netherlands and Japan, but “doesn’t plan to water down its plans if those other nations adopt weaker guidelines,” the report said.
Shipments of export-controlled technologies from the U.S. and its allies to Russia have dropped nearly 50% by value since Russia’s invasion of Ukraine last year, said Thea Kendler, the Bureau of Industry and Security’s assistant secretary for export administration. Kendler, speaking during a conference last week hosted by the Association of Women in International Trade, touted the impact of export restrictions imposed by Japan, the U.K., South Korea and other nations she said are part of the Global Export Control Coalition (GECC), adding that the controls have led to the “severe deterioration” of Russia’s ability to sustain its military.