BIS Seeks New Funding for Reviews of Emerging Technology, Foreign Investment

The Commerce Department's Bureau of Industry and Security would like to increase its funding by about $4 million for export administration (EA), the agency said in its Fiscal Year 2020 budget justification. That new money would be split between "Identifying and Reviewing Emerging Technologies" and "Addressing Increased Foreign Investment Reviews," it said. BIS is asking for funding for 21 new personnel, the agency said.

Twelve new hires, a combination of engineers and analysts, "are required to identify those emerging technologies that could, if transferred outside the U.S., pose a significant risk to the national security of the U.S. or impact U.S. technological leadership in specific areas," BIS said. The agency began an effort to find such emerging technologies last year, though some of that work was delayed by the partial federal government shutdown (see 1903110047). "Once identified, staff will work to obtain consensus among international partners on export controls for those emerging technologies determined to be critical," the agency said. "Additionally, engagement and outreach to the impacted community will be essential for success."

The new function is meant to address "a serious long-term threat to the U.S. defense innovation base," BIS said. "Many leading edge technologies are vulnerable to transfer or theft by potential adversaries like China, long before they appear in specific military or dual-use products." Currently, "there is no locus in the U.S. government to identify and recommend appropriate measures to restrict the outflow of these technologies."

The agency also requested funding to help "address significant growth in the workload of foreign investment reviews," BIS said. There have been record levels of "cases from the Committee on Foreign Investment in the United States (CFIUS)," which should only increase after the passage of the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA), BIS said. "BIS encountered a record caseload in FY 2018, and that number is expected to quadruple with the full implementation of FIRRMA," it said.

BIS also reported that EA has become more efficient in its export license processing. "In FY 2018, EA processed 35,346 export license applications," it said. "This marked a 3.5 percent increase from the 34,142 applications processed in FY 2017. EA approved 30,379 license applications (85.9 percent), returned 4,686 applications without action (13.3 percent), and denied 281 applications (0.8 percent). [EA]’s average processing time this year to review a license application was 18 days. This included time for reviews by other agencies, namely the Departments of Defense, Energy, and State."