The House passed a bill and a resolution Jan. 8 aimed at protecting the competitiveness of U.S. manufacturers and exporters in the 5G sector. The measures also seek to improve the U.S.’s presence at international bodies that set standards for 5G networks and equipment over fears that China will permanently surpass U.S. 5G technology and control the market. The House passed the Secure 5G and Beyond Act, which requires several federal agencies, including the Commerce Department, to “protect the competitiveness” of U.S. companies by completing an assessment of the competitiveness and vulnerabilities of U.S. manufacturers and suppliers of 5G equipment. The bill also requires the agencies to identify “policy options” to close “security gaps” in the U.S. development of “critical technologies.”
Exports to China
The Export Control Reform Act may not result in significantly different controls on emerging technologies (see 1912130055) than what would have been proposed under the U.S.’s existing export control system, a former top Commerce Department official said. Eric Hirschhorn, former undersecretary for the Bureau of Industry and Security from 2010-2017, also said Commerce’s efforts to restrict sales of foundational technologies might be too late. “I have grave doubt whether the assignment to control emerging and foundational technologies will result in controls significantly different from what the existing system -- which operates fairly well -- would have produced,” Hirschhorn said in a Jan. 3 post for China Business Review.
The Trump administration should sanction Chinese officials and companies responsible for human rights violations against the country's Uighur population, the Congressional-Executive Commission on China said in a Jan. 8 report. The U.S. should also place export controls on a wide range of emerging technologies, add more Chinese agencies to the Commerce Department’s Entity List and make these issues key components of trade negotiations with China, the report said.
President Donald Trump signed the fiscal year 2020 National Defense Authorization Act, S. 1790 into law, with provisions targeting tech companies Huawei and ZTE (see 1912130027), the White House announced on Dec. 20. The law bars the Trump administration from lifting the Commerce Department Bureau of Industry and Security's addition of Chinese telecom equipment manufacturer Huawei to its export entity blacklist without congressional approval. The law also requires reports to Congress on waivers issued to companies doing business with Huawei as well as ZTE's compliance with a 2018 agreement that lifted Commerce's ban on U.S. companies selling telecom software and equipment to ZTE.
China's Foreign Ministry criticized the Commerce Department’s efforts to restrict sales of emerging technologies (see 1912160032), saying the U.S. is “abusing export control measures” and “impeding” cooperation between the two countries. A ministry spokesperson said the U.S. is “over-generalizing” the concept of national security as justification for the export controls, which are aimed at preventing countries, including China, from acquiring access to sensitive U.S. technologies. “Don't think you can ever deter China's growth as well as scientific and technological innovation by limiting exports of high-end technologies to us,” the spokesman said during a Dec. 18 press conference. “You are being too arrogant.”
Export Compliance Daily is providing readers with some of the top stories for Dec. 9-13 in case you missed them.
BOSTON -- If the Commerce Department follows through on plans to expand the limits of the Export Administration Regulations to further control foreign shipments to Huawei, it will have a “dramatic” impact on international supply chains, said Kevin Wolf, a trade lawyer with Akin Gump and Commerce’s former assistant secretary for export administration. The measures, which Commerce confirmed it was considering earlier this month (see 1912100033), include expanding the Direct Product Rule and broadening the de minimis rule to make more foreign-made goods subject to the EAR.
A Canada-based contractor for the U.S. Navy and the company’s president were fined for their involvement in a scheme that included unlicensed exports to China and giving false information to the Commerce Department’s Office of Export Enforcement, the Justice Department said in a Dec. 4 press release. The company, OceanWorks International Corp., and its president, Glen Omer Viau, were fined $84,000 and $25,000, respectively. Viau was credited for time served.
An Iranian businessman was sentenced to 46 months in prison for illegally exporting carbon fiber from the U.S. to Iran, the Justice Department said Nov. 14. Behzad Pourghannad worked with two others between 2008 and 2013 to export the carbon fiber to Iran from third countries using falsified documents and front companies, the agency said.
The Dec. 3 House passage of the Uyghur Human Rights Policy Act of 2019 will have serious repercussions for U.S.-China trade talks if the bill becomes law, a China Foreign Affairs Ministry spokesperson threatened on Dec. 4. H.R. 649 and the companion S. 178 that cleared the Senate in September demand tough U.S. sanctions on China over reports of government-run detention centers imprisoning millions of Muslim-minority Chinese citizens in Xinjiang.