The Bureau of Industry and Security should add the Commercial Aircraft Corporation of China (COMAC), a state-owned aerospace manufacturer, to its Military End-User List, Florida Sens. Marco Rubio and Rick Scott said in an April 24 letter to BIS Undersecretary Alan Estevez. The Republican lawmakers said COMAC works closely with the Aviation Industry Corporation of China (AVIC), which is already included on the Entity List and MEU list and holds a minority stake in COMAC.
Sen. Roger Wicker, R-Miss., said companies should make sure they comply with national security-related trade restrictions following the Bureau of Industry and Security's record $300 million fine against Seagate Technology for violating export controls against Huawei (see 2304190071). “Our national security interests are being threatened by Communist China, and companies need to take this situation seriously by following the law,” said Wicker, who led Senate Republicans two years ago in producing a report that urged BIS to penalize Seagate for violating the controls (see 2110260040).
The Bureau of Industry and Security this week proposed new export controls on automated peptide synthesizers that may be used to produce biological weapons (see 2304170010). Although several U.S. companies and a Chinese academy last year warned BIS against imposing new license requirements, the agency said the synthesizers qualify as emerging or foundational technologies and may need to be restricted.
The Bureau of Industry and Security on April 19 fined Seagate Technology $300 million for violating U.S. export controls against Huawei in what it said is the “largest standalone administrative penalty in BIS history.” The agency said the California-based company and its branch in Singapore sold more than 7 million export-controlled hard disk drives to Huawei in violation of the BIS foreign direct product rule.
The Bureau of Industry and Security again renewed the temporary denial order for Moscow-based air cargo carrier Aviastar. BIS first suspended the export privileges of the Russian cargo charter airline in April 2022 (see 2204210043) and renewed the order in October (see 2210190009), barring it from participating in transactions with items subject to the Export Administration Regulations. The agency renewed the denial order for another 180 days April 14 after finding Aviastar continued to illegally operate aircraft subject to the EAR, including for flights within Russia.
The Bureau of Industry and Security fined U.S.-based Seagate Technology $300 million for allegedly violating U.S. export controls against Huawei, the “largest standalone administrative penalty in BIS history,” the agency said. The agency fined the company and its branch in Singapore for selling millions of export-controlled hard disk drives to Huawei in violation of BIS’ foreign direct product rule. As part of a settlement agreement, Seagate agreed to a “mandatory multi-year audit requirement,” BIS said, and could face a five-year export denial order if it violates the terms of the agreement. The settlement comes about 18 months after Senate Republicans urged BIS to penalize Seagate for “likely” violating U.S. export controls against Huawei. Seagate said it received a proposed charging letter from BIS in August.
The Bureau of Industry and Security issued a new set of policy "clarifications" this week that it hopes will increase the number of voluntary self-disclosures (VSDs) it receives for serious export violations. One clarification says the agency could increase penalties on companies that fail to disclose a “significant” potential violation, while another clarification could reward companies that tip off BIS about their competitors’ wrongdoings.
The Bureau of Industry and Security recently suspended the export privileges of four people, including two for making false statements to the government and two others for illegally exporting guns or ammunition to Mexico.
The Bureau of Industry and Security last week completed its interagency review of new proposed export controls on automated peptide synthesizers. The rule, sent for review at the Office of Information and Regulatory Affairs March 29 (see 2303300003) and completed April 12, could propose new restrictions on certain instruments for the automated synthesis of peptides that could be used to produce biological weapons (see 2209120021).
The U.S. needs to pour more funding and resources into the Bureau of Industry and Security to allow it to better address China-related national security risks, said Gregory Allen, a technology policy expert with the Center for Strategic and International Studies and a former Defense Department official. Although BIS is charged with implementing some of the U.S.’s most sensitive trade restrictions, its export control functions have “had a flat budget for the better part of a decade,” Allen said during a U.S.-China Economic and Security Review Commission hearing last week. “It has been profoundly neglected” and subject to an “appalling mismanagement of resources.”