US to Prioritize Semiconductor Export Controls, Investment Screening During TTC

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.

"We're going to be continuing our close cooperation on export control issues around semiconductors," the official said during a Sept. 27 call with reporters. “I think we're actually in a very good place with the commitments you're going to see us announce on semiconductors." The U.S. and the EU have made progress during the past several months on semiconductor export controls, the official added, and industry should expect that “close cooperation” to continue.

The U.S. and the EU will also focus some of their export control talks on artificial technology-powered items and other emerging technologies, the official said, but didn’t name specific goods. “Beyond semiconductors, I think you're going to see a set of robust commitments and cooperation on AI and where we can work together on artificial intelligence,” the official said, adding both the U.S. and EU strongly prefer coordinated controls over unilateral ones. “Both the U.S. and EU recognize the importance of export controls,” the official said, “and a multilateral approach is the most effective way for export controls to work.”

The inaugural TTC meeting will also include talks on foreign direct investment screening (see 2109160022), the official said. Although both the U.S. and the EU believe that “openness to foreign investment is essential for economic growth and innovation,” they will discuss how to better scrutinize deals that may transfer sensitive technologies to adversaries. “Both the U.S. and the EU face common national security-related risks,” the official said. “You'll see us announce some joint principles of how we will collectively be working together on investment screening and on export controls issues.”

European Commission Vice President Valdis Dombrovskis made similar points this week, saying the EU hopes to better coordinate with the U.S. on export and investment restrictions. "Here our aim is to strive for convergent export control approaches on sensitive dual-use technologies," Dombrovskis said Sept. 27, adding that the EU wants "to develop a shared understanding of how best to do investment screening."

Another administration official said the Commerce Department will specifically use the TTC to look at how “we can improve our standards collaboration,” particularly surrounding emerging technologies. Technology industry officials have recently pushed the department to establish a blanket exemption for U.S. people and companies to participate in standards-setting bodies that have members designated on the Entity List (see 2109150036). The agency also hopes to “identify concrete ways to secure our digital infrastructure, including through export controls cooperation,” the official said.

Another official stressed this week’s TTC gathering is just “the start of an ongoing process and not a one-off meeting.” The official provided a few other trade issues the U.S. will prioritize other than export controls and investment screening, including various global trade challenges, other countries’ “non-market trade distortive policies” and risks in the information and telecommunication technology supply chain.