Although the Commerce and State departments have been able to conduct some export end-use checks during the COVID-19 pandemic, officials said both agencies continue to face challenges scheduling on-site inspections.
Sahar Hafeez has left the Bureau of Industry and Security to begin a new role this week as National Security Council director of international economics. As a senior adviser in the office of the BIS undersecretary, she contributed to the agency’s work on semiconductor supply chain issues (see 2107280051) and other areas.
China objected to the U.S. decision to add 33 Chinese entities to its Unverified List, it said in a Feb. 7 news release. The Bureau of Industry and Security made the additions, which included universities and companies operating in China's technology and electronics sectors, due to its inability to verify the reliability of the entities through end-use checks (see 2202070012). According to an unofficial translation, China's Ministry of Commerce said that the U.S. should immediately correct its perceived wrongdoing and return to mutual beneficial cooperation. MofCom characterized this action, along with the U.S. past export control moves, as tools of "political suppression and economic bullying." A BIS spokesperson dubbed its end-use checks a "core principle" of the agency's export control system.
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The Bureau of Industry and Security added 33 Chinese entities to its Unverified List this week, including universities and companies operating in China's technology and electronics sectors. BIS hasn’t been able to verify the “legitimacy and reliability” of the entities through end-use checks, including their ability to responsibly receive controlled U.S. exports, the agency said in a notice. The UVL additions take effect Feb. 8
The Bureau of Industry and Security will add 33 Chinese entities to its Unverified List this week, including a range of companies operating in China's technology and electronics sectors, it said in a notice released Feb. 7. BIS said it hasn’t been able to verify the “legitimacy and reliability” of the entities through end-use checks, including their ability to responsibly receive controlled U.S. exports. All export license exceptions involving those parties will be suspended, and exporters must obtain a statement from any party listed on the UVL before proceeding with certain exports.
Crowell & Moring has seen “mixed results” and some longer response times from the Bureau of Industry and Security for license applications captured by the agency’s military end-use and end-user rule, said Brian McGrath, a trade lawyer with the firm. But overall, McGrath said the agency has been helpful when responding to exporter questions about the rule, which imposed more due-diligence requirements on shipments that could be sent to military end users or used for military end uses in certain countries (see 2102190042).
The Bureau of Industry and Security issued a Feb. 3 final rule to reorganize, make corrections and clarify the scope of its foreign direct product rules. The changes, mentioned in the agency’s fall 2021 regulatory agenda (see 2112210044), help to clarify where and how the FDP rules apply and make some corrections to language in the Export Administration Regulations.
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The Bureau of Industry and Security is hoping to expand the number of officers it sends overseas and increase collaboration with other investigative agencies, partly to help with a larger workload and a rise in new export control evasion trends. Agents said BIS has seen a steady increase in work since the enactment of the Export Control Reform Act of 2018, which has been made more complex by the rise in cryptocurrency schemes, increasingly sophisticated uses of front companies and ransomware attacks.