Report: Scale of Export Controls 'Outpaced' Government Ability to Enforce Them
The vast expansion of export controls to counter American adversaries has eclipsed the government's ability to enforce them, according to a new report from the Council on Foreign Relations.
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The report, co-chaired by former Commerce Secretary Gina Raimondo and released Nov. 13, found that while export controls have expanded, their effectiveness hasn't, primarily because of insufficient government resources. "BIS’s staff capacity has not kept pace with the growth in controls." It also suggested that the punishments for violating export controls are "relatively mild" and insufficient to deter violators.
The U.S. has "struggled" to enforce export controls, the report said, particularly on advanced semiconductors, which have "continued flowing to prohibited countries." Export controls can be only part of the solution since they can "at best slow an adversary," it said.
Much of the difficulty in enforcement can be linked to a lack of resources in the government, the report said, as BIS "struggles to attract technical expertise on par with industry" and must rely on "antiquated data systems." BIS employed only 190 enforcement agents in 2021 to tackle 32 million exports of dual-use items, the report said.
It called for an upgrade to "expertise, technology, and authorities" at BIS and emphasized the need for "flexible hiring authorities" and modern analytics programs. It also recommended increased penalties for export control violations "closer to the value of the illicit transaction," arguing that the Commerce Department should levy penalties "up to twice the revenue of the illicit transaction."
Additionally, the report suggested the creation of an export control task force associated with DOJ and the Treasury Department to mobilize "the full range of U.S. government authorities to impose penalties."
To make export controls more effective, the report recommended a regular review of restrictive measures to narrow the scope to "fewer, more critical items." It also pushed for the creation of a central "foreign military sales-only list" maintained by the State Department and the exemption of U.S. allies from select license requirements, similar to the AUKUS agreement among Australia, the U.K. and the U.S. It recommended transferring approval for U.S. government advocacy on defense sales from Commerce to State.
At a panel discussion Nov. 13 announcing the report's release, Raimondo praised the work she accomplished in her time in the Biden administration and said that it's "unfortunate" that the Trump administration is unwinding it. "I obviously disagree with the approach that's being taken now, but hopefully they'll be successful."