China's Evasion of Chip Controls Is ‘Disturbing,’ Senator Says

Sen. John Kennedy, R-La., said last week he remains concerned by recent news reports showing China has found ways around U.S. export controls on advanced computing chips.

“How come we’re allowing them to be sold to China?” Kennedy asked at a Senate Banking Committee hearing. “This is very disturbing.”

Kennedy initially outlined his concerns in a July 8 letter to Commerce Secretary Gina Raimondo (see 2407090030). He said last week that BIS isn't doing a good enough job "shutting down" networks selling advanced semiconductors to China, including those produced by U.S. chip company Nvidia.

Kennedy directed his comments to Thea Kendler, assistant secretary for export administration at the Bureau of Industry and Security. Kendler stressed that her team helps oversee license applications, and if an application is "not consistent with national security, we do not approve it."

She also told Kennedy BIS could add entities involved in an evasion network to the agency's Entity List. "But you haven't done it yet," Kennedy said. Kendler said she would be "happy to connect you with our enforcement team to talk about this in more detail."

Sen. Sherrod Brown of Ohio, the committee's top Democrat, said he shares Kennedy's concerns, but "I think this is one reason why BIS needs more funds." The Biden administration asked for a 17% increase in funding for BIS in its FY 2025 budget request (see 2403110065).