Shipments of export-controlled technologies from the U.S. and its allies to Russia have dropped nearly 50% by value since Russia’s invasion of Ukraine last year, said Thea Kendler, the Bureau of Industry and Security’s assistant secretary for export administration. Kendler, speaking during a conference last week hosted by the Association of Women in International Trade, touted the impact of export restrictions imposed by Japan, the U.K., South Korea and other nations she said are part of the Global Export Control Coalition (GECC), adding that the controls have led to the “severe deterioration” of Russia’s ability to sustain its military.
The Bureau of Industry and Security approved $23 billion worth of prospective exports involving Chinese companies on the Entity List from January through March 2022, representing about 79% of all license applications it received for those companies during that time period. The data, recently released by House Foreign Relations Committee Chair Michael McCaul, R-Texas, shows an “unacceptable” amount of approvals, the lawmaker said.
The Bureau of Industry and Security will increase the number of penalties it issues against corporations for export violations this year, an effort it hopes will lead to improved industry compliance, the top export BIS enforcement official said last week. DOJ also will concentrate more resources on targeting export violators, a top agency official said, and plans to significantly expand its Export Control Section.
Western democracies should pursue new restrictions on technology researchers or risk further falling behind China in global technological competition, the Australian Strategic Policy Institute said in a report that it released this week. The institute warned that China’s dominant research position could allow that country to “gain a stranglehold on the global supply of certain critical technologies.”
The Bureau of Industry and Security this week added 37 entities to the Entity List for a range of activities the agency said threaten U.S. national security, including for supporting Russia’s war effort, sending controlled items to China’s military and aiding companies already listed on the Entity List. The entities -- located in Belarus, Myanmar, China, Pakistan, Russia and Taiwan -- will be subject to a license requirement for all items subject to the Export Administration Regulations with varying license application review policies. BIS also modified 10 existing Chinese entries on the Entity List. The additions and changes took effect March 2.
The Bureau of Industry and Security added 37 entities to the Entity List for a range of reasons, including for supplying controlled items to Iran, supporting China’s military modernization efforts, illegally providing items to Russia and contributing to surveillance efforts in China and Myanmar. The entities -- located in Belarus, Myanmar, China, Pakistan, Russia and Taiwan -- will be subject to a license requirement for all items subject to the Export Administration Regulations with varying license application review policies. BIS also modified 10 existing Chinese entries on the Entity List. The additions and changes take effect March 2.
The Bureau of Industry and Security is considering new export controls on certain machinery or lab equipment used by Chinese suppliers of precursor chemicals, which are used to produce fentanyl. BIS Undersecretary Alan Estevez, speaking during a Feb. 28 House Foreign Affairs Committee hearing, said the agency is working with the Drug Enforcement Administration “to assess whether we can put restrictions” on those items. “So we're doing that kind of assessment, working both on the enforcement and my export administration side to see what we can do to crack down on that,” he said. Estevez was responding to a question from Rep. Madeleine Dean, D-Pa., who asked how the administration is working to “pressure” China to “combat financial flows from illicit fentanyl.”
The Biden administration should be doing more to harmonize its export controls and sanctions lists to more effectively penalize foreign companies that should be subject to strict trade restrictions, lawmakers said this week. Several Republicans suggested they plan to pursue legislation to mandate that the Bureau of Industry and Security’s Entity List be aligned with sanctions lists maintained by the Treasury Department, and at least one lawmaker said BIS should already have taken steps to formally do so.
One of the “most challenging” aspects of complying with U.S. and Western sanctions against Russia during the past year has been the service restrictions, which has created hurdles for companies trying to understand “exactly what types of activities fall within the scope of the covered services,” Sidley Austin said. In a Feb. 22 alert describing key compliance lessons from one year of Russia sanctions, the law firm said the service restrictions are “broad,” affecting everything from accounting to quantum computing, and not always carried out equally across various sanctions regimes.
The Commerce, State and Justice departments fined an American 3D printing company more than $25 million combined after it committed a range of export violations, including illegal shipments of aerospace technology and metal alloy powder to China and controlled design documents to Germany.