House lawmakers submitted a host of proposed export control- and sanctions-related amendments as part of the FY 2024 National Defense Authorization Act, including measures that could ease defense technology sharing restrictions, harmonize the Entity List with certain U.S. sanctions and investment restrictions and place new export control requirements on items destined to China and Iran. Other amendments could lead to new sanctions on Chinese technology companies and government officials, add the USDA to the Committee on Foreign Investment in the U.S., establish a new sanctions coordination office in the State Department and more.
Export controls need to be improved following reports that the Chinese spy balloon shot down by the U.S. earlier this year contained American technology, Reps. Michael McCaul, R-Texas, and Bill Hagerty, R-Tenn., said in an emailed statement June 29. The lawmakers cited a Wall Street Journal report that said the spy balloon was “loaded with American-made equipment” that allowed it to collect information.
A Republican-backed bill in the Senate could require the Bureau of Industry and Security to adopt a license review policy of presumption of denial for controlled exports to “any end user” in China or Russia and to notify Congress before approving a license to either country. After notifying Congress, lawmakers would be able to block BIS from granting the license, which will help “create additional safeguards to ensure sensitive technology does not flow to our adversaries,” the bill’s introducers’ press release said.
China’s recent restrictions on Micron products are having broader than expected consequences for U.S. exporters, a trade industry conference heard last week, and may portend how future Chinese retaliatory actions will affect U.S. companies.
The Bureau of Industry and Security last week issued a correction to its June 14 final rule that added 43 entities to the Entity List, including various Chinese companies that support the country’s military (see 2306120030). BIS said it mistakenly included an entity in its “preamble justification” for the additions “but inadvertently did not instruct, nor provide regulatory text for, the addition of the entity to the Entity List.”
Lawmakers in the Senate and House this week reintroduced a bill that could require the Commerce Department to block exports of sensitive personal data to certain high-risk countries (see 2306010042). The Protecting Americans’ Data from Foreign Surveillance Act, originally introduced during the last Congress, would also look to restrict personal data exports by firms, such as TikTok, “directly to restricted foreign governments, to parent companies in restricted foreign countries” and to parties designated on Commerce’s Entity List. Export penalties would apply to “senior executives who knew or should have known that employees below them were directed to illegally export Americans’ personal data.”
Although the Bureau of Industry and Security last month said it doesn’t have a draft rule in place to increase export licensing requirements for Huawei, exporters would be wise to still expect a tightening of restrictions against the Chinese telecommunications company, industry officials said this week. They also didn’t rule out BIS soon increasing export controls against China in other ways, including by potentially adding more items to the scope of its military end-use and end-user (MEU) rule requirements.
China “firmly” opposed the U.S. additions of Chinese entities to its Entity List this week, a Foreign Ministry spokesperson said, calling on the Biden administration to “immediately stop using military and human rights-related issues as pretexts to politicize, instrumentalize and weaponize trade and tech issues.” The U.S. should “stop abusing export control tools such as entity lists to keep Chinese companies down,” the spokesperson said during a regular press conference June 13. The export controls targeted companies in China and elsewhere for supporting China’s military or the government’s human rights abuses in Xinjiang (see 2306120030).
The Treasury Department should sanction Russian state-owned nuclear company Rosatom, a “major source of funds” for Moscow and “one of the only largely unsanctioned Russian energy companies,” said Gregory Meeks, the House Foreign Affairs Committee’s top Democrat. Meeks, speaking during a June 13 House Financial Services Committee hearing, pointed to his bill introduced last month that would require the administration to designate Rosatom (see 2305120015).
The Bureau of Industry and Security added 43 entities to the Entity List this week, including companies conducting various activities that either support China’s military or allow the government to “carry out human rights abuses.” Other entities were added for supporting Pakistan’s ballistic missile program or other weapons capabilities.