The Commerce Department has been “slow” to complete a series of export control reviews mandated by the Export Control Reform Act, including the agency’s upcoming controls on emerging and foundational technologies, Sens. Chuck Schumer, D-N.Y., and Tom Cotton, R-Ark., said.
Exports to China
China criticized a Nov. 14 U.S.-China Economic and Security Review Commission report that called for more export controls against China and more support for Taiwan, saying the commission’s report is inaccurate. “The committee you mentioned is deeply entrenched in prejudice against China. Its reports are rarely based on facts,” a Chinese Foreign Ministry spokesperson said Nov. 15. “I have no interest in commenting.” The report also provided details on “harassment” tactics employed by China against U.S. companies, including unannounced site investigations and unwarranted tax investigations (see 1911140050).
The U.S. should expand export controls against China and study the country’s efforts to dominate emerging technology sectors, the U.S.-China Economic and Security Review Commission said. In its 2019 annual report, the USCC painted a somewhat grim picture for the prospects of U.S technology competition with China, saying China is committed to maintaining a dominant economic role in trade negotiations and is focused on outpacing the U.S. in the artificial intelligence sector -- a key area of concern for upcoming U.S. export control regimes. To combat this, the commission made several recommendations to Congress to safeguard U.S. technologies, improve foreign market access for U.S. exporters and pre-empt Chinese attempts to undercut U.S. companies and sanctions.
Export Compliance Daily is providing readers with some of the top stories for Nov. 4-8 in case they were missed.
One panelist said it will take 20 years to know who are the winners and losers of today's tariffs and export restrictions. Another panelist said U.S. factory workers making washing machines and solar panels are clearly winning from the safeguards launched nearly two years ago, as are Vietnam and Mexico. Another panelist said Vietnam and Thailand, and Mexico to a much lesser degree. As moderator Lucas Queiroz Piers said, “It is a confusing moment." The Alston & Bird legal consultant was coordinating a panel called "U.S. Sanctions and Trade War: Winners and Losers," at an American University Washington School of Law International Trade Symposium on Nov. 5.
The Commerce Department plans to release proposed export controls on emerging technologies within the “next few weeks” and an advance notice of proposed rulemaking on foundational technologies before the end of the year, a top Commerce official said. Matt Borman, the Commerce deputy assistant secretary for export administration, suggested Commerce has been eager to release both controls to ease concerns from U.S. trade groups and companies, which have warned the agency against overly broad, unilateral controls.
Two bills that could affect trade with Hong Kong and two resolutions criticizing Hong Kong and China passed the House by voice vote on Oct. 15. H.R. 4270, the PROTECT Hong Kong Act, would ban the export of tear gas, rubber bullets and pepper spray to Hong Kong, so that U.S. companies aren't complicit with crackdowns on protestors (see 1909190040). The Hong Kong Human Rights and Democracy Act, H.R. 3289, requires the State Department to affirm that Hong Kong still deserves its special status in customs and export controls because the one country, two systems agreement for China and Hong Kong is still in force. That bill would also sanction people involved in human rights abuses and the suppression of “basic freedoms” in China and Hong Kong, and would have an annual evaluation of Hong Kong's export control compliance.
It is “impossible” for U.S. exporters to fully comply with Commerce Department restrictions on transfers within China because Chinese courts do not enforce the restrictions, according to an Oct. 13 post by Harris Bricken.
President Donald Trump announced a "very substantial phase 1" deal in the Oval Office Oct. 11, saying the Chinese and American negotiators came to a deal on intellectual property, financial services and agricultural sales. The president said China will buy as much as $40 billion to $50 billion worth of American commodities. He also said good progress had been made on issues around technology transfer from American companies to Chinese partners.
The Commerce Department's Bureau of Industry and Security added 28 entities to its Entity List for their involvement in human rights violations of China’s Uighur population, BIS said Oct. 7. The entities include Xinjiang Uighur Autonomous Region People’s Government Public Security Bureau, 18 of its subsidiaries and eight China-based technology and science companies, including Hikvision, a major supplier of video surveillance products. The announcement takes effect Oct. 9.