US, Allies Launch Export Enforcement Coordination Effort, Hoping for More Penalties

The Bureau of Industry and Security announced the launch of a formal process to coordinate with certain allies on export enforcement efforts, an effort the agency’s Office of Export Enforcement has been working on for months. BIS said the “partnership” -- agreed to with the fellow Five Eyes partners Australia, Canada, New Zealand and the U.K. during a meeting in Canada this week -- will leverage each country’s resources to expand enforcement “capacity” and better “prevent and deter evasion of export controls,” BIS said.

The new partnership shows the U.S. and its Five Eyes partners “stand united in our commitment to vigorous enforcement of the Russia and Belarus export restrictions,” said Matthew Axelrod, top BIS export enforcement official. Axleord said he hopes the process leads to “additional enforcement outcomes” in each country, including more “detentions, penalties, and public identification of diversionary actors.”

During meetings in Ottawa, the countries agreed to formally exchange information on export control violations, including “trends in illicit procurement methods,” which will allow the countries to “identify and address export evasion risks and enhance their ability to prevent unauthorized transfers and safeguard collective national security interests,” BIS said. The agency expects the partnership to “significantly enhance the effectiveness of each country’s export control regimes, minimize gaps in enforcement, and foster joint investigations and coordinated enforcement actions.”

BIS said the countries also plan to “strengthen enforcement partnerships with industry,” calling that a “key component to countering diversion efforts. By fostering a strong public-private partnership, the initiative aims to strengthen the resilience of global supply chains and prevent unauthorized diversion of controlled items.”

Axelrod for several months has previewed BIS’ plans to create a first-of-its-kind multilateral export enforcement mechanism to better share information with allies, particularly surrounding Russian trade restrictions (see 2303030035 and 2210210029). He said he eventually wants that effort to include European countries and trading partners in Asia.