Regulatory intelligence for US exporters

Emerging Tech Controls Need More Industry Outreach, Collaboration, Experts Say

The U.S. and other governments need to substantially increase outreach with industry before continuing to pursue export controls over emerging technologies, experts said. Although the U.S. and other governments do some outreach work, future controls will be ineffective and difficult to comply with without more industry input, they said. “It’s [like] trying to change a tire while we’re driving down the road,” said Scott Jones, a senior adviser at the Strategic Trade Research Institute, speaking during a Nov. 17 webinar hosted by STRI. “Going forward, it fundamentally has to be much more collaborative.’

The Bureau of Industry and Security has been working since 2018 to identify emerging and foundational technologies for potential export restrictions. Although BIS seeks industry input through public comments on proposed rules and through members of its technical advisory committees, Jones said, he finds that industries around the world want a “much more collaborative” relationship with their governments as they seek to control new and advanced technologies.

Jones, who is also a trade, technology and security expert with the Stimson Center, pointed to a recent BIS proposal for controls on software for the operation of nucleic acid assemblers and synthesizers (see 2011050043). He said complicated controls such as those need significant input from experts. “You're going to need a geneticist to discuss that with the policymaker in order to get the right sized and appropriate control on that technology,” Jones said. Although BIS does “tremendous work,” Jones said, BIS’s relatively slow emerging technology process has served as a “test case” for other governments to understand how difficult the process is. “I don't think that’s an accident,” he said. “Conceptually, it's very challenging. We’re dealing with a new approach to controlling technology, so it's going to take some time.” Although BIS officials have called the process challenging, the agency disputes claims that the effort has been slow, citing controls on about 40 emerging technologies so far (see 2010020055).

More industry collaboration would help with the process, said Kevin Cuddy, a government and regulatory affairs official in IBM’s export regulation office. Cuddy, speaking during the webinar, said smaller companies would particularly benefit from hearing from other industry compliance professionals on how to comply with BIS regulations. Cuddy said governments should coordinate more with industry to do outreach on their behalf.

“In my conversations with government officials, they understand their own rules very well, but they often do not understand how industry actually complies with them,” Cuddy said. “They're very good about putting people on restricted party lists, but they really have no idea how companies actually implement those controls and processes in their companies and how complicated it can be to determine whether or not the person you may be dealing with is actually the one on one of these lists.”

Cuddy said the U.S. should look to Japan’s Center for Information on Security Trade Control as a model for more industry collaboration. CISTEC, a non-governmental organization that Cuddy said was originally started by the Japanese government, helps to connect regulators and industry experts to better inform companies about export compliance. “CISTEC is a very good model for how government can help support private entities’ outreach to industry,” he said.

Although Cuddy said the U.S.’s rulemaking process is “pretty good,” it may need to change to address emerging technology controls. He said governments often face challenges “articulating very clearly” the risks surrounding emerging technologies, and could benefit from the help of technology experts who understand the risks of complicated items such as facial recognition technology.

“The way regulations and export controls have been implemented in the past is not working when it comes to emerging technologies,” Cuddy said. “The government needs to think about how it collaborates with industry to learn more about these new technologies.”