The Bureau of Industry and Security is adding 24 companies to the Entity List for participating in a range of illegal exports, including efforts to aid Russia’s military, supply export-controlled items to Iran or support Pakistan’s nuclear activities, the agency said in a final rule released Dec. 7. The additions include entities located in Latvia, Pakistan, Russia, Singapore, Switzerland and the United Arab Emirates. BIS also removed one company from the Entity List.
Ian Cohen
Ian Cohen, Deputy Managing Editor, is a reporter with Export Compliance Daily and its sister publications International Trade Today and Trade Law Daily, where he covers export controls, sanctions and international trade issues. He previously worked as a local government reporter in South Florida. Ian graduated with a journalism degree from the University of Florida in 2017 and lives in Washington, D.C. He joined the staff of Warren Communications News in 2019.
China has been more receptive to U.S. end-use checks on Chinese entities as a result of a Commerce Department policy change from October, Bureau of Industry and Security Undersecretary Alan Estevez said this week. Estevez also said he doesn’t expect any significant revisions to BIS’s most recent chip restrictions on China, and warned that a Chinese invasion of Taiwan would spark new, strict U.S. export controls that would cause U.S. companies to lose “billions” of dollars in Chinese business.
The State Department’s Directorate of Defense Trade Controls this week released its long-awaited updated compliance program guidelines (see 2211100023), which are intended to outline and detail “key elements” of an effective compliance program, the agency said. The 63-page document includes instructions on how to design a program for defense companies and universities that deal with items controlled on the U.S. Munitions List, as well as sections on recordkeeping, reporting, International Traffic in Arms Regulations training, risk assessment audits and more. DDTC stressed that “scope of ITAR activity in which different organizations engage varies substantially,” and each compliance program “should be tailored to address each organization’s ITAR-controlled activities, risk factors, and size.”
The U.S. and the EU announced new export control initiatives during the Trade and Technology Council’s meetings this week, including a pilot program to better exchange information on dual-use export controls and a new effort to increase research collaboration on quantum technologies. But the U.S. didn’t use the meetings to try to convince European officials to push its firms, such as ASML, to adopt more stringent chip export controls against China, Commerce Secretary Gina Raimondo said.
U.S.-based Omni Logistics violated shipping regulations when it failed to include required information on demurrage invoices for more than 200 containers, said TPG Pressure, a U.S. supplier of construction equipment and services. In a complaint to the Federal Maritime Commission dated Nov. 29, TPG said it was forced to pay Omni more than $860,000 in unfair fees before the company released its cargo, adding that Omni also invoiced TPG an additional $362,000 for “alleged services and costs.”
U.S. share of global semiconductor design revenue has declined over the past decade, partly due to export controls and other trade restrictions, the Semiconductor Industry Association and Boston Consulting Group said in a report last week. If the U.S. continues on its path and doesn’t properly tailor its restrictions, U.S. shares of global revenues could drop 10 percentage points over this decade, the report warned.
The U.S. expects allies to eventually impose similar semiconductor export controls against China, said National Security Adviser Jake Sullivan, echoing comments by Commerce Department officials earlier this year (see 2210270047 and 2211040014). Sullivan, speaking Nov. 30 during a conference hosted by the Center for Strategic and International Studies and the South Korean JoongAng media group, said the U.S. “engaged in intensive consultations” with South Korea and Japan before the administration's latest chip controls were released in October (see 2210070049), which ultimately shaped how the restrictions were crafted and could lead to those two countries and other joining the U.S.
The U.S. is confident that world leaders will agree to a price cap on Russian oil ahead of the Dec. 5 cap start date, Deputy Treasury Secretary Wally Adeyemo said during a Dec. 1 event hosted by Reuters. Adeyemo suggested the U.S., the G-7 and the EU are close to an agreement that would prohibit a range of shipping services related to the transport of Russian oil being traded above a certain price (see 2211230047).
The maritime industry should see an increase in Russian sanctions evasion tactics as the U.S., the EU and others prepare to set a price cap on Russian oil, said David Tannenbaum, a former sanctions compliance specialist at the Office of Foreign Assets Control. Logistics companies and others should be on the lookout for a rise in deceptive maritime practices, which could call for more compliance work and recordkeeping to avoid running afoul of U.S. sanctions, said Marco Crusafio, an international shipping lawyer with Squire Patton.
The U.S. is looking to “aggressively” reform and bolster its export controls and investment screening tools to counter China, particularly surrounding emerging and foundational technologies, Commerce Secretary Gina Raimondo said, speaking Nov. 30 at the Massachusetts Institute of Technology. Raimondo outlined what she called the U.S.’s “economic competitiveness strategy” toward China, stressing that the administration isn't looking to sever trade ties with the country but that companies in sensitive sectors should be reassessing business with China.