While too early to declare a success, the U.S.-European Union Trade and Technology Council has set both sides on a path toward tangible progress on more export controls and investment screening collaboration, experts said. During the inaugural TTC meeting last week, the U.S. and EU agreed to develop “convergent” export controls and share more information to catch malign foreign investments (see 2109290083), which could result in meaningful changes within the next year, the experts said.
The Bureau of Industry and Security has faced challenges applying some of its new export control rules during the last year, including its military end-use and end-user regulations and broader semiconductor-related policies toward China, a senior BIS official said. Matt Borman, BIS’s deputy assistant secretary for export administration, said he recognizes the rules may also be causing compliance challenges for industry, and the agency is considering more guidance.
The Bureau of Industry and Security this week completed an interagency review for a final rule that would expand export controls on certain biological equipment software. The rule, received by the Office of Information and Regulatory Affairs Sept. 13 (see 2109140011) and completed Sept. 28, would control software “for the operation of automated nucleic acid assemblers and synthesizers” that are “capable of designing and building functional genetic elements from digital sequence data.”
The U.S. and the European Union agreed to develop “convergent” export controls on sensitive technologies and work more closely on investment screening, the White House said in a fact sheet released after the Sept. 29 inaugural meeting of the U.S.-EU Trade and Technology Council (see 2109270027). Although the White House didn’t name specific technologies that could come under more export control or investment scrutiny, it stressed the importance of semiconductor supply chain cooperation and said the two sides agreed to “achieve concrete outcomes by the next meeting.”
The State Department is considering an open general-license concept for certain defense exports, which would allow U.S. exporters to ship to certain U.S. trading partners without having to apply for a specific license, a senior agency official said. The concept would likely begin as a pilot program, said Mike Miller, deputy assistant secretary for defense trade in the Bureau of Political-Military Affairs, but it's still being discussed and there isn’t yet a timetable for release.
The Office of Foreign Assets Control fined two Texas companies -- both subsidiaries of Netherlands-based oilfield services company ​Schlumberger Ltd. -- for violating U.S. sanctions against Russia and Sudan, OFAC said Sept. 27. The agency fined oil and gas service provider Cameron International Corp. more than $1.4 million for illegally providing services for a Russian Arctic offshore oil project and fined gas product provider Schlumberger Rod Lift, Inc. $160,000 for helping to illegally facilitate shipments to Sudan. OFAC said neither company voluntarily self-disclosed its violations.
The Bureau of Industry and Security fined a Texas semiconductor component manufacturer nearly $500,000 for illegally exporting controlled wafers to Russia via Bulgaria (see 2012210013), the agency said in a Sept. 28 order. The company, Silicon Space Technology Corporation, which began doing business as Vorago Technologies in 2015, worked with a Russian engineering firm to export “rad-hard 16MB Static Random-Access Memory (SRAM) wafers,” which were controlled under the Export Administration Regulations for spacecraft and related components.
The U.S. plans to prioritize discussions on export controls and investment screening tools during the first meeting of the U.S.-European Union Trade and Technology Council this week (see 2109130025), senior administration officials said. The two sides plan to release a set of shared trade and technology commitments after the Sept. 29 meeting in Pittsburgh, which should hint at closer collaboration on various trade restrictions, one official said, particularly involving semiconductors.
The Office of Foreign Assets Control issued two general licenses aimed at allowing humanitarian assistance and aid to more easily flow to Afghanistan amid the Taliban takeover of the country’s government. The agency, which also published new guidance for using the licenses, said Sept. 24 it’s “committed to ensuring that U.S. sanctions do not limit the ability” of the Afghan people to receive aid from the U.S. government and the international community.
Although the Committee on Foreign Investment in the U.S. allowed Magnachip Semiconductor Corp. to refile its proposed acquisition by Beijing-based Wise Road Capital (see 2109160037), the deal seems highly unlikely to pass CFIUS scrutiny, trade lawyers said. Finding pathways to mitigate the national security risks identified by CFIUS will be extremely challenging, they said, particularly as the U.S. increases its focus on stopping China from acquiring advanced semiconductor equipment.