Logistics companies, especially those based in China, should closely examine their U.S. export control risks, particularly after the Commerce Department added a range of Chinese logistics firms to the Entity List earlier this month for their involvement in microelectronics exports to Russia (see 2310060044), major Asian law firm King & Wood Mallesons said in a client alert last week.
The U.S. decision to add 49 entities, mostly from China, to its Entity List for exporting microelectronics to Russian consignees linked to the Russian defense sector is a "typical act of economic coercion," China's Ministry of Commerce said last week, according to an unofficial translation. The ministry said it opposed the additions, which took effect Oct. 6 (see 2310060044). China called for the immediate cessation of the listings, noting it will take "all necessary measures to resolutely safeguard the legitimate rights and interests of Chinese enterprises."
A House bill that could apply blocking sanctions on a host of Chinese companies included on various government denied party lists would “create enormous problems” for U.S. companies doing business in China, said William Reinsch, a former Commerce Department official and current Scholl Chair in International Business at the Center for Strategic and International Studies.
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The Biden administration needs to soon update its China-related chip export controls and apply “full blocking sanctions” to Huawei and China’s Semiconductor Manufacturing International Corp., top House Republicans recently said in a letter to National Security Adviser Jake Sullivan. Those measures and others will address what the lawmakers said has been a ”failure” by the administration and the Bureau of Industry and Security to properly enforce the Oct. 7 chip restrictions, which placed new license requirements on a host of chip-related exports and activities involving China.
The Bureau of Industry and Security added 49 entities, mostly from China, to the Entity List for shipping microelectronics to Russian consignees connected to the country’s defense sector. The entities are semiconductor companies, technology businesses, logistics companies and others, and also include companies based in Estonia, Finland, Germany, India, Turkey, the United Arab Emirates and the U.K.
The Bureau of Industry and Security sent an interim final rule for interagency review this week that could update U.S. export controls on certain semiconductor manufacturing items and make modifications to the Entity List. The rule was sent to the Office of Information and Regulatory Affairs Oct. 4. A BIS spokesperson declined to comment about what the rule will entail.
The Bureau of Industry and Security added 49 entities from China, Estonia, Finland, Germany, India, Turkey, the United Arab Emirates and the U.K. to its Entity List for providing support to Russia’s military or to its defense industrial base. The entities, outlined in a final rule effective Oct. 6, are subject to license requirements for all items subject to the Export Administration Regulations, and licenses will be reviewed under a policy of denial.
The Bureau of Industry and Security dismissed appeals from a Turkish airline and a Russian tour company after both said they were wrongly implicated in a temporary denial order the agency renewed against a separate Russian airline in June.
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