The Defense Department on Aug. 28 released another list of Chinese companies with ties to the country’s military, potentially requiring increased due diligence measures for U.S. companies doing business with them. The list includes companies on the Commerce Department’s Entity List and others not yet subject to U.S. restrictions. The entities may also fall under the scope of an April Commerce rule that increased licensing requirements for exports to military end-users or for end-uses in China (see 2004270027). The Defense Department issued a similar list in June (see 2006250024).
A researcher at a California university is being investigated for trying to transfer sensitive U.S. software or technical data to a Chinese company on the U.S. Entity List, the Justice Department said Aug. 28. Guan Lei, a Chinese national and researcher at the University of California, Los Angeles, was arrested for allegedly destroying evidence on a hard drive that may have implicated him in the illegal software transfer, the agency said. The Justice Department said it is investigating whether Guan, of Alhambra, California, tried to send the software to China’s National University of Defense Technology.
China’s Foreign Ministry termed “unjustified” the U.S. decision to add 24 Chinese companies to the Commerce Department’s Entity List (see 2008260038), saying it interferes in Chinese internal affairs. “We urge the U.S. to correct its mistake and immediately stop meddling in China's internal affairs,” a ministry spokesperson said during an Aug 27 news conference. “China will take firm measures to safeguard Chinese businesses and citizens' lawful interests.”
The Bureau of Industry and Security added 60 entities to the Entity List, including 24 entities for helping the Chinese military build artificial islands in the South China Sea. BIS also designated entities in France, Hong Kong, Indonesia, Malaysia, Oman, Pakistan, Russia, Switzerland and the United Arab Emirates for a range of activities, including illegal exports to Iran, submitting false information to BIS, contributing to Russian biological weapons programs and more. BIS also revised five existing entries under Canada, Germany, Hong Kong, Iran and the UAE.
The Bureau of Industry and Security plans to add 60 entities to the Entity List, including 24 entities for helping the Chinese military build artificial islands in the South China Sea. BIS will also designate entities in France, Hong Kong, Indonesia, Malaysia, Oman, Pakistan, Russia, Switzerland and the United Arab Emirates for a range of activities, including illegal exports to Iran, submitting false information to BIS, contributing to Russian biological weapons programs and more.
The Bureau of Industry and Security on Aug. 17 added 38 Huawei affiliates to the Entity List and refined a May amendment to its foreign direct product rule, further restricting Huawei’s access to U.S. technology, the agency said in an Aug. 17 final rule. BIS also modified four existing Huawei entries on the Entity List, amended language in the Export Administration Regulations and said it will continue one cybersecurity-related authorization under its temporary general license for Huawei. The remainder of the license expired Aug. 13.
Export control experts advocated for more effective U.S. controls, saying the U.S. should pursue more multilateral support and may need to rethink its strategy toward China. In a series of short essays published Aug. 13 by the Center for a New American Security, experts and former policymakers dive into how the controls can be more effective, what they should target, and how the controls are viewed by U.S. allies and adversaries.
The Bureau of Industry and Security added 38 Huawei affiliates to the Entity List and refined a May amendment to its foreign direct product rule, further restricting Huawei’s access to U.S. technology. BIS said the direct product rule will now also apply to transactions where U.S. software or technology is “the basis” for a foreign-made item produced or purchased by Huawei, or when a Huawei entity is “a party to such a transaction.” Secretary of State Michael Pompeo said Huawei "has continuously tried to evade" the previous changes to the foreign direct product rule.
U.S. export controls are set to become more of a factor at universities worldwide as U.S.-China technology competition accelerates, forcing academic institutions to adjust to an expanding basket of regulations and compliance standards, a Hinrich Foundation report said. Colleges, which already struggle with insufficient government export control guidance (see 2005120053), need to be prepared for increased controls on software and networks, placement of foreign universities on blacklists and bans on certain foreign funding, the report said.
The Bureau of Industry and Security will hold a virtual export control policy conference Sept. 2, covering updates on export control regulations, license exceptions, semiconductor controls and the Entity List. The conference will include a question-and-answer session with BIS officials and “other agency experts,” and will feature updates from the State Department’s Directorate of Defense Trade Controls, sanctions policy and the Committee on Foreign Investment in the U.S. BIS canceled its in-person annual conference earlier this year due to the COVID-19 pandemic (see 2005210051).