EU to Address Intangible Tech Transfers, Issue Other Export Guidance Soon, Official Says

LONDON -- The EU is hoping to soon make progress on several export control initiatives, including possible updates to its restrictions over intangible technology transfers and how countries coordinate on emerging technologies, a senior European Commission trade official said this week. It’s also planning to publish a collection of detailed export licensing data as well as new guidelines for exports of cyber-surveillance items before the end of the year.

Stephane Chardon, the senior export control official in the EU’s Directorate General for Trade, said the EU is carving out time to address export control issues surrounding intangible technology transfers, which companies for years have said are unclear and don’t align with similar controls from close allies, including the U.S. The trade policy group Digital Europe has called the EU’s intangible tech transfer rules “ancient” and said companies have been asking for guidance for over a decade (see 2206150038 and 2212090026).

Chardon, speaking during a defense industry conference this week hosted by SAE Media, said the commission is working with member states and industry representatives to set up a “technical expert working group” to address issues around the controls. He said the EU has been gathering “ideas” from EU companies about how to clarify and update the EU’s take on the controls, and “there is support from all the states to do something. It's just not yet quite clear exactly what,” he said.

Addressing this issue has been a “long-standing demand,” from EU industry, Chardon said. “For various reasons, it's not been addressed so far, but hopefully there will now be some time and energy devoted to this issue.”

The bloc also is hoping to publish first-of-its-kind export licensing data next month. The EU in January issued new guidelines about how European data should be collected and compiled (see 2401250045) in its annual export control report, which previously only published “very partial licensing data,” Chardon said, maybe “four or five graphs.”

Now, “you can expect a relatively thick annex to the next report with quite a bit of licensing data,” he said.

He called the process of collecting data “complicated,” saying the EU has had to compile information from thousands of individual licenses issued by member states in addition to exports sent under general export authorizations. Chardon said the goal is to “increase the transparency of export controls.”

But he stressed that “confidentiality requirements” will still place some limits on what data the commission can share. “Not everything is going to be released,” he said.

The commission is also “approaching the end of” its work on guidelines for exports of cyber-surveillance items, Chardon said, calling it “a very long process.” The EU has been crafting the guidance for years and solicited public comments on the issue in April 2023 (see 2303310025). “We expect to publish this in October,” he said.

Among other things, Chardon said the guidelines will help exporters “identify” cyber-surveillance technologies that may not yet be controlled by multilateral export control regimes but may still warrant scrutiny.

The commission is also aiming to help EU countries better coordinate their national export controls for emerging technologies that haven’t yet been adopted by multilateral regimes, such as the Wassenaar Arrangement. The EU began publishing a compilation of those member states' control lists last year (see 2407030048 and 2310270019), and Chardon said the commission is hoping to release a proposal before the end of the year on how “coordination between the member states should go in this context.”

He said the commission is working to provide the information technology "infrastructure” for EU countries to share information with each other about which emerging technologies are controlled. This could, for example, “make sure that someone who is denied the export in one of the member states is not going to be able to basically reroute the shipment” through another member state, Chardon said.

He also said more coordination between member states’ export control authorities and customs agencies could improve enforcement, especially for European trade restrictions on Russia. The commission is trying to foster better “connections” between those government bodies, which Chardon said are “highly insufficient at the moment.”

Better coordination could allow a customs agency of one member state to check the terms and conditions of an export authorization from another member state to “see whether the value or volume has already been exhausted or not,” he said, meaning the item would no longer be eligible for the authorization.

“We are developing tools,” he said. “This is going to take some time, but it is making progress to connect the competent authorities with customs agencies.”