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The United States and its allies are aiming to choke off the supplies that support the last vestiges of Russian industry. On May 19, 2023, the Bureau of Industry and Security (BIS) released new regulations implementing additional restrictions under the Export Administration Regulations (EAR) as well as corrections and clarifications on existing controls for Russia and Belarus.[1] Those additions build on recent export control regulations issued on February 24, 2023 (which we discuss here) and significantly expand controls over items that can be used in even basic electronics and manufacturing. The new regulations continue BIS’s push to leave very little that may be sent into Russia from the United States.…

Continue Reading Everything but the Kitchen Sink (and Maybe That Too!): New Export Controls on Russia Cover Whole Categories of Low-Level Commercial Electronic and Mechanical Equipment

When can an employer use the “national security exception” under U.S. anti-discrimination law to make a hiring decision based on the national origin of the candidate? An often overlooked area of compliance is how to comply with anti-discrimination law when the job will include access to export-controlled data.…

Continue Reading Don’t Let the Government Name, Shame, and Fine You – Export Controls Do NOT Excuse Hiring Discrimination

On March 2, 2023, Deputy Attorney General Lisa Monaco delivered remarks to the ABA’s National Institute on White Collar Crime. Unsurprisingly, her remarks focused heavily on inspiring a culture of compliance – including highlighting the DOJ’s new policy to incentivize companies to self-report criminal activity (which our Organizational Integrity Group discusses here). But, her remarks also emphasized an emerging priority for DOJ enforcement: the intersection of corporate crime and national security.…

Continue Reading “Sanctions Are The New FCPA”: DOJ Increases Focus on Sanctions and Export Control Enforcement

It looks like the licensing restrictions on Huawei are trickling into effect.

Our sources indicate that, as early as February 27, all license applications for exports or transfers involving Huawei which were pending with the U.S. Bureau of Industry and Security (BIS) have been placed on Hold Without Action. Further, we understand from various industry sources that BIS has begun informing certain U.S. companies that they will not receive further licenses to export chips for end use by Huawei.…

Continue Reading Breaking the Link – New Developments on U.S. Licenses for Exports to Huawei

Update and Correction: We had understood that the date for the announcement of a regulatory change would be February 13. That understanding is (pretty obviously, now, on February 14) incorrect. We still believe the change is imminent and will update as soon as we have further information.

Key takeaways

  • Soon, the U.S. government will officially issue a stricter policy of denial for providing lower-tech items to Huawei.
  • Technological containment continues as the Netherlands and Japan move to impose U.S.-style restrictions on semiconductor exports to China.

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Continue Reading Tightening the Cordon – U.S. Restricts Licensing Policy and Adds Allies to Technology Controls

Key Takeaways

  • U.S.-person personnel at Chinese chip manufacturers are in a precarious position.
  • New rules limit what activities those persons may undertake with respect to their work.
  • However, there are ways they can nevertheless contribute to their companies, maintain their citizenship status, and comply with applicable U.S. law.

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Continue Reading China Semiconductor Regulations, Episode II – The Curious Case of the American in a Chinese Chip Company

  • BIS added 33 Chinese companies to the Unverified List.
  • The UVL places lesser restrictions designees than an Entity List or Sanctions designation
  • BIS may not have been able to verify the entities because of new Chinese laws restricting compliance with extraterritorial laws; creating a potential conflict of laws for these and other companies.

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Continue Reading Verify, Then Trust: Commerce Adds 33 Parties in China to Unverified List

On August 28, 2020, China took its own swing in the fight over TikTok. The blow, however, may land right in the middle of U.S.-China technology research, collaboration, and innovation. New export regulations may require licenses from the Chinese government before researchers in China may share their technological advances with colleagues, counterparts, or customers in the United States.
Continue Reading China Expands Technology Export Controls: Fighting back on TikTok and Putting Your R&D at Risk

Taking a break from reporting on COVID-19 legal developments, we turn for a moment to what is happening now on export control of autonomous vehicle technology.

The autonomous vehicle R&D sector is booming, largely in the last three years. Companies are investing in sensor technology and machine learning, and creating pilot programs to test self-driving cars both for individuals and ride-sharing purposes.…

Continue Reading The Emerging Landscape for Export Controls on Autonomous Vehicle Technology

Key Takeaways:

  • Technology Infrastructure and Data. CFIUS will focus its review on investments in critical Technology, critical Infrastructure, and sensitive personal Data (“TID Businesses”).
    • Critical technologies is defined to include certain items subject to export controls along with emerging and foundational technologies under the Export Control Reform Act of 2018.
    • CFIUS provides a very helpful list of critical infrastructure and functions to help assess whether any business is a TID Business. We reproduce most of this list at the end of this blog article. (Sneak preview: telecom, utilities, energy, and transportation dominate the list.)
    • The proposed regulations provide much-needed guidance on what constitutes sensitive personal data and also seek to limit the reach of the definition so it does not cast too wide a net over transactions in which CFIUS really should have no national security concern.
  • Exceptions for Certain Countries. Investors from certain countries may be excepted from CFIUS jurisdiction when making non-controlling investments.
  • New Set of Rules for Real Estate. In a companion piece, CFIUS proposed for the first time a detailed set of rules related to investments in real estate. We will cover this in a separate blog article to be published in the near future.
  • Expansion of Short-Form Declaration Use. The proposed rules provide parties the choice to use a short-form declaration for any transaction under CFIUS jurisdiction in lieu of a long-form notice.
  • Comments Due by October 17, 2019. Members of the public may submit comments on the proposed regulations any time between now and October 17, 2019. Final regulations must be adopted by CFIUS and become effective no later than February 13, 2020.

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Continue Reading CFIUS Proposes Rules to Implement FIRRMA

On May 16, 2019, a sweeping U.S. export control rule went into effect that will impact the U.S. tech industry, but may also create an outsized risk for non-U.S. manufacturers. The rule, issued by the U.S. Department of Commerce, Bureau of Industry and Security (BIS) adds Huawei Technologies Co., Ltd. (Huawei) and 68 of its affiliates to the Entity List. That designation effectively prohibits the export, reexport, and retransfer of all U.S.-origin “items subject to the Export Administration Regulations (EAR)” to those entities. The designation arises from a U.S. government finding that the restrictions are warranted on U.S. national security and foreign policy grounds.
Continue Reading Hua-Wait a Minute: Entity Designation Affects Non-U.S. Manufacturers’ Exports to China Tech Giant