The Bureau of Industry and Security should increase its enforcement of semiconductor export controls to prevent American-made computing chips from ending up in Russian weapons and Chinese artificial intelligence systems, the Democratic majority staff of the Senate Permanent Subcommittee on Investigations said in a new report released this week.
The Pentagon this week removed two Chinese companies from its 1260H List, the list it uses to name firms that it says have ties to China’s military. The agency removed semiconductor company Advanced Micro-Fabrication Equipment and investment firm IDG Capital Partners Co., it said in a Federal Register notice Dec. 18. It didn’t give a reason for the delistings. Companies on the list face certain U.S. government contract restrictions.
The outbound investment legislation that lawmakers agreed Dec. 17 to include in a newly unveiled continuing resolution (CR) (see 2412170063) would expand upon the Biden administration’s August 2023 executive order (see 2308090066) by covering more artificial intelligence models and by adding hypersonic and related aerospace technologies.
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Semiconductor companies should expect more export control rules from the Bureau of Industry and Security before the Trump administration takes office, including possibly new licensing rules and record-keeping requirements for certain chip exports to destinations outside of China, trade lawyer Charles Capito said.
House Foreign Affairs Committee Chairman Michael McCaul, R-Texas, said Dec. 17 that lawmakers have forged a compromise on legislation to restrict U.S. outbound investment in China.
The U.S. is planning new export controls to restrict sales of advanced artificial intelligence chips to certain parts of the world in a bid to further limit China’s ability to access them, The Wall Street Journal reported Dec. 13. The rules, which could reportedly come this month, may place caps on shipments of AI chips to certain countries for use in large computing facilities, including nations in Southeast Asia and the Middle East. Close U.S. allies would not be affected, the report said. The Biden administration recently sent letters to major chipmakers informing them about some of the restrictions.
Even if a transaction is authorized by a Treasury Department sanctions license or a Commerce Department export license, it still may be subject to prohibitions or notification requirements under Treasury’s new outbound investment rules (see 2410280043), the agency said in new FAQs.
The multilateral Wassenaar Arrangement this month posted a summary of export control changes made during the group’s Dec. 4-5 plenary meeting in Austria, covering editorial changes, clarifications and updated control parameters for various categories under its list of dual-use goods and technologies. Wassenaar’s plenary chair, held this year by Italy, said member states adopted new controls involving suborbital spacecraft and their components as well as technologies used to make metal alloy powders for “high-performance” 3D printing of dual-use technologies. The group also agreed to clarify controls over systems for submersible vehicles, directed energy weapons, epitaxy-covered substrates for semiconductor manufacturing and more.
The U.S. and China need to pause their escalating trade restrictions against one another and have a “serious” conversation about how to manage national security risks around technology to prevent a dangerous decoupling of their two economies, the outgoing leader of a major U.S.-China business organization warned this week.