'Tension' in Executive Branch on Export Controls, Foundational Tech, Panelist Says

There is significant tension and disagreement between the Defense and Commerce departments about the reach of U.S. export controls, said Jamie McCormick, a staffer for House Appropriations Committee Republicans, June 27 at the American Association of Exporters and Importers Annual Conference in Washington. McCormick said the confusion surrounding foundational technologies among U.S. industry leaders may stem from the original passage of the Export Control Reform Act of 2018, adding that he believes the executive branch does not agree on a definition for foundational technologies. “I’m not certain that at the time they passed the bill that the executive branch could say with any certainty what they meant by foundational technologies,” McCormick said.

Adrienne Frazier, a lawyer with the Commerce Department's Bureau of Industry and Security, said during the panel that neither Commerce nor Defense has “actually given a specific view of how it defines” emerging or foundational technologies. Frazier said she defines emerging technologies as products that are “new to everyone in that industry” and defines foundational technologies as products that “have been around for quite a bit of time but that are only now being realized to have national security concerns.”

McCormick added that there is “tension that I Imagine exists” between agencies about the scope of export controls for emerging and foundational technologies. Defense likely wanted to control “whole technology areas to prevent the leakage of militarily significant technologies to China,” McCormick said, while Commerce likely thought that approach was “overbroad” and could hurt U.S. industry. “What we really need to do is drill down in each of these emerging technologies and find out what specific technologies we know about ought to be controlled to prevent the export of technology to China or other potential adversaries.”

Frazier said Commerce plans to issue an advance notice of proposed rulemaking “as quickly as they can,” echoing comments made by Commerce Assistant Secretary for Export Administration Rich Ashooh in June (see 1906040038). Commerce last updated the Commerce Control List with five new emerging technologies on May 23 (see 1905220051).

Kevin Wolf, who formerly held Ashooh's position, said the notion that the Trump administration is considering imposing broad controls over wide categories of technologies, such as robotics and artificial intelligence, is a “big myth.” Wolf said that notion was largely shot down after Commerce issued a notice requesting public comments for emerging technologies toward the end of 2018. “The notice basically said these are the topics we’re looking into -- we’re not trying to touch published information or fundamental research,” Wolf said.

But Wolf suggested that U.S. industries are still largely concerned with the scope of upcoming export controls on technologies. “Will it be any technology associated with artificial intelligence if you are dealing with China? Or will it be a specific, narrowly tailored technical type of control over technologies that are not yet mature?” Wolf said. “I have no idea. And I don’t think anybody knows yet.” But while Wolf said it is unclear, he said he believes the controls will not be overbroad. “We will have to wait and find out,” he said. “But I believe If they follow the statute, it will be a very narrow, tailored and specific set of controls.”