The Bureau of Industry and Security added 43 entities in China, Kenya, Laos, Malaysia, Pakistan, Singapore, South Africa, Thailand, the United Arab Emirates and the U.K. to the Entity List for either supporting China’s military, supporting the government's human rights abuses or supporting Pakistan’s weapons capabilities. The additions, outlined in a final rule effective June 12, impose license requirements for all items subject to the Export Administration Regulations. The agency also removed one entity from the list.
The Bureau of Industry and Security last week suspended export privileges of Aratos Group, a collection of defense and technology companies in the Netherlands and Greece, and its owner for procuring goods for Russian intelligence services in violation of U.S. export controls. BIS also renewed a temporary denial order against three people and two companies also involved in a Russian sanctions evasion scheme.
The Commerce Department should use the Entity List and potentially its anti-boycott regulations to respond to Beijning’s restrictions on U.S. chip company Micron (see 2305220053 and 2305240002), Reps. Michael McCaul, R-Texas, and Mike Gallagher, R-Wis., said in a June 1 letter to Commerce Secretary Gina Raimondo. The lawmakers said it’s time for the U.S. and its partners to “firmly push back” on China’s “economic coercion, adding that it "can no longer sit on the sidelines as the [People’s Republic of China] selectively targets U.S. and allied entities with the goal of intimidating our businesses and harming our economic security.”
The Bureau of Industry and Security has seen a recent spike in completed end-use checks in China after years of dormancy, which has allowed the agency to verify controlled items went to their intended destination, said Matthew Axelrod, top export enforcement official at BIS. Axelrod, speaking during a Senate Banking Committee hearing this week, said the agency has completed more than 90 checks in the last seven months, a stark turnaround from a government in China that hadn’t “scheduled a single end-use check for us in over two years.”
The Bureau of Industry and Security doesn't have a draft rule in place to increase export licensing requirements for Huawei despite rumors this year that new restrictions for the Chinese technology company were imminent, said Thea Kendler, BIS assistant secretary for export administration. Kendler also said the agency has seen a sharp decline in China-related license applications, is spending more time reviewing those applications and is prioritizing reviews of artificial intelligence items, quantum computing technology and biotechnology for new export controls.
The U.S. should convince the U.N. to harmonize its sanctions lists with U.S. trade blacklists, a House Financial Services subcommittee heard during a hearing last week. Aligning the lists could require the World Bank and other international organizations to adhere to U.S. sanctions, one witness said, and help the U.S. extend the reach of its restrictions against China.
The Commerce Department should amend several portions of its proposed guardrails on recipients of Chips Act funding, including measures that could prevent the U.S. chip industry from participating in international standards bodies or inhibit “routine” business activities, trade groups and technology companies said in comments released this week. Some said Commerce should also limit which companies qualify as “foreign entities of concern” and revise the rule’s proposed definition for “legacy semiconductor” to more closely align with export controls.
Republicans leaders this week criticized China's decision to ban certain sales from U.S. chip company Micron (see 2305220053), saying the move was politically driven and lacked evidence.
The U.S. should impose a range of new sanctions and other restrictions on Chinese companies with ties to human rights violations in the Xinjiang region, including by imposing financial sanctions on companies on the Entity List and introducing outbound investment restrictions, the House Select Committee on China said this week. The committee also said the U.S. and its allies need to better coordinate on a potential sanctions response -- and be ready to deploy those measures -- if China invades Taiwan.
The U.S. announced a host of new Russia-related sanctions and export controls last week, including more than 300 sanctions designations by the Treasury and State departments and an expansion of Commerce Department export controls on items destined to Russia and entities supporting the country’s military. The measures, some of which were coordinated with allies as part of the Group of 7 summit in Japan, aim to “further undermine Russia’s capacity to wage its illegal aggression” in Ukraine, the G-7 countries said in a May 19 joint statement.