The Bureau of Industry and Security has placed its foreign military intelligence rule (see 2101140035) on hold and may not implement the rule’s changes later this month, a BIS official said. Although the rule was published in the Federal Register in January, BIS included it in the Biden administration’s regulatory freeze because it wasn’t scheduled to take effect until March 16.
Ian Cohen
Ian Cohen, Deputy Managing Editor, is a reporter with Export Compliance Daily and its sister publications International Trade Today and Trade Law Daily, where he covers export controls, sanctions and international trade issues. He previously worked as a local government reporter in South Florida. Ian graduated with a journalism degree from the University of Florida in 2017 and lives in Washington, D.C. He joined the staff of Warren Communications News in 2019.
The Bureau of Industry and Security denied export privileges for a German aircraft maintenance company and fined it more than $50,000 for procuring U.S. parts and components for a sanctioned Iranian airline. MSI Aircraft Maintenance Services International GmbH & Co. worked with Iran’s Mahan Airways (see 2011270001) to illegally export U.S.-origin reservoir and valve assemblies, which were controlled under the Export Administration Regulations, BIS said in a March 5 order. The agency said it will waive MSI’s three-year export denial if the company pays the fine, cooperates with BIS during a three-year probationary period and doesn’t commit any more EAR violations.
Five companies said they may have violated U.S. sanctions, export controls or anti-corruption laws, according to their February Securities and Exchange Commission filings. The potential violations involved illegal exports, providing services to sanctioned territories and gift cards sent to the Chinese government.
The Bureau of Industry and Security's January rule that expanded export restrictions on foreign military intelligence agencies (see 2102190042) and other activities of U.S. companies could lead to expansive licensing requirements and place burdensome compliance obligations on U.S. companies, Akin Gump said in a March 1 letter to BIS. The law firm said it represents a client that may be affected by the rule’s broad language and urged the agency to narrow its breadth to limit impacts on legitimate business.
The Bureau of Industry and Security issued new restrictions on exports to Myanmar and added four entities to the Entity List in response to the country’s military-led coup last month (see 2102110020). The restrictions, which take effect March 8, increase controls on certain “sensitive” items, remove certain license exceptions, impose a more strict licensing policy and subject Myanmar to BIS’s military end-use and end-user restrictions (see 2012220027), according to a final rule released March 4.
The Bureau of Industry and Security recently expanded its commodity classification request process to include the Department of Defense, which is expected to slightly increase processing times and potentially require more thorough submissions of classification requests, an agency official said. The Defense Department began participating in the process late last year as part of BIS’s implementation of the 2018 Export Control Reform Act, said John Varesi, an official in BIS’s Sensors and Aviation Division. ECRA “required that there would be an interagency effort in terms of the commodity classifications,” Varesi said during a March 2 Sensors and Instrumentation Technical Advisory Committee meeting. “This is basically the implementation of that requirement.”
The U.S. needs to modernize its approach to export controls and expand disclosure requirements for foreign investment screening to maintain its technology dominance over China, a U.S. national security commission said in a report this week. The commission called current U.S. export controls outdated, urged the Commerce Department to more quickly control emerging and foundational technologies, and said the Committee on Foreign Investment in the U.S. should review a broader set of transactions to protect sensitive technologies.
The U.S. sanctioned a host of Russian officials and agencies, will add 14 entities to the Entity List and will increase restrictions on exports of military-related goods to Russia in response to the poisoning and imprisonment of Russian opposition leader Alexei Navalny. The increased export controls will also remove certain license exceptions for shipments to Russia and will impose stricter license review policies for certain sensitive goods, the State Department said March 2.
The State Department is expected to follow through with a rule that would permanently revise the International Traffic in Arms Regulations to allow employees involved in ITAR-related activity to work remotely. The rule, crafted under the Trump administration, was sent for interagency review in December but was withdrawn in January as part of the Biden administration's regulatory freeze on the previous administration’s pending regulations (see 2101210013).
The Bureau of Industry and Security's effort to control emerging and foundational technologies is creating “substantial uncertainty” in the technology sector, Microsoft President Brad Smith told the Senate Armed Services Committee Feb. 23, according to his prepared testimony. Smith urged BIS and the Commerce Department to create a “balanced and coherent framework” to protect U.S. technologies without “isolating” U.S. companies, including from working with China.