House Committee Considering New Semiconductor Export Controls

The House Foreign Affairs Committee is reviewing new export controls on items related to semiconductors, potentially including design elements and software, said Rep. Michael McCaul, R-Texas. McCaul said some U.S. export restrictions may need to be strengthened to address continuing Chinese attempts to steal U.S. technologies.

“I think we need to take another look at export controls,” McCaul said, speaking during an Oct. 13 online event hosted by the Center for Strategic and International Studies. “I don’t want to get ahead of myself, but that is something we’re reviewing on the committee.” McCaul, the top Republican on the committee, said the U.S. needs to be more “careful when it comes to” national security-related items “in terms of what we export into” China.

McCaul said China has tried to “manipulate” U.S. export controls for decades and has gotten “pretty good at it.” The U.S. needs to rethink its own export regime to better address Chinese theft, he said, especially among military technologies, dual-use items and at universities. He said China is increasingly using “our own system against us, whether it’s the Export Control [Reform] Act and technology or our open academic environment.”

Although new controls or other changes need to be carefully crafted to avoid harming industry, McCaul said, some national security concerns must take precedence. “I’m very mindful of the private sector and our defense contractors … but I do think you've got to be careful because you don’t want to arm what I think is the longest-term threat to our national security,” he said. “We’ve got to take a look at this.”

A Commerce Department spokesperson said the agency “shares the concern” about China's “acquisition of sensitive U.S. technologies for malign purposes, and has consistently worked on efforts aimed at impeding such troubling acquisitions.” The spokesperson declined to say whether the agency is working with the Foreign Affairs Committee on new export controls. The agency recently began a broad review of export controls on advanced technologies to limit China’s access to those items (see 2007220050), and is in the process of controlling sets of emerging and foundational technologies (see 2010070012 and 2010020042).

McCaul also said he is optimistic about a House bill that would incentivize U.S. semiconductor manufacturing and provide more federal funding for the industry (see 2006110038). “I do think there are enough supporters of this,” McCaul said, adding that more funding would help U.S. companies compete with Chinese state-backed corporations. “We can’t afford not to do this right now, or we could lose this competition that we find ourselves in.”