The Commerce Department should tighten export restrictions on China’s top chipmaker to prevent it from importing sensitive semiconductor equipment and exploiting a U.S. export control loophole, Sen. Marco Rubio, R-Fla., and Rep. Michael McCaul, R-Texas said. The lawmakers, who voiced similar concerns to Commerce last year (see 2103190005), said in a March 17 letter to Commerce that its export control licensing policies for Semiconductor Manufacturing International Corporation are “ineffective” and are denying less than 1% of export applications to sell technology to the company.
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The Bureau of Industry and Security has started a large-scale industry outreach effort to ensure companies understand compliance requirements under the new Russian export controls, including direct talks with U.S. and foreign businesses and work on new guidance. The effort, previewed by BIS officials this week, underscores the significant export control and regulatory undertaking by the agency since late February, which has resulted in hundreds of pages of new Russian and Belarusian export restrictions.
Ahead of a meeting with Chinese officials, U.S. national security adviser Jake Sullivan publicly warned China that it will face severe penalties if it helps Russia evade Western sanctions. The Biden administration is “watching closely” to see whether Beijing provides Moscow with “material support or economic support,” Sullivan told CNN March 13, which could give Russia an economic lifeline as it faces crippling financial restrictions from Europe, the U.S. and many of its trading partners.
Russia’s aviation authority said China has declined to provide Russian airlines with aircraft parts, some of which are subject to Western sanctions, Reuters reported March 10. The announcement came after Boeing and Airbus ceased providing Russia with aircraft components, which are subject to U.S. and EU export controls. A Russian official told the country’s news agencies that it will look to source parts from other countries, including Turkey and India, after a “failed attempt to obtain them from China,” according to the report. The U.S. Department of Commerce has threatened to penalize Chinese companies that help Russia evade export restrictions, including placing them on the Entity List (see 2203080053).
Even before new sanctions and export controls targeting Russia take full effect, many companies are deciding that compliance and due diligence costs are not worth the potential profits of continued business dealings in Russia and Belarus, former U.S. export control and sanctions officials said, speaking at a Washington International Trade Association panel on March 10.
Export Compliance Daily is providing readers with the top stories from last week in case you missed them. You can find any article by searching the title or by clicking on the hyperlinked reference number.
The Commerce Department could impose strict export controls, including through the Entity List, on Chinese companies that violate U.S. export restrictions against Russia, agency officials said this week.
The U.S. last week imposed new export controls on Russia’s oil refinery sector and added 91 entities to the Entity List for supporting Russian security efforts, building on a string of trade restrictions (see 2202240069 and 2203020072) meant to cut Russia off from importing goods to support and fund its military.
The Bureau of Industry and Security announced new export controls on Russia’s oil refinery sector and added 91 entities to the Entity List for supporting Russian security or military sectors. The new restrictions, which took effect March 3, build on an extensive set of U.S. sanctions announced within the last week in response to the invasion of Ukraine, meant to cut Russia off from importing goods that help support and fund its military.