Although the current congressional proposal for a new outbound investment screening mechanism faces some hurdles, it could be incorporated into the upcoming National Defense Authorization Act. Sen. Pat Toomey, R-Pa., said he has concerns with some of the provisions but hopes to work with bill’s sponsors to include some type of outbound screening measure in the fiscal year 2024 defense spending bill, which could be passed this year.
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.
The Bureau of Industry and Security was “overwhelmed” with advisory opinion requests after issuing its 2020 rules creating military end-user regulations and an MEU list (see 2004270027), said Matt Borman, deputy assistant secretary for export administration, speaking during a Sept. 27 defense industry conference hosted by IDEEA. He said the agency was “happy” to help companies that had questions about the rule, but the process was time-consuming. “It took us a while,” Borman said. “But I think we're through that backlog” now.
More exporters should make use of License Exception STA (Strategic Trade Authorization), which could reduce workload for the government and allow certain exports to move faster, officials from the Commerce and Defense departments said. “Frankly, it's not utilized as much as we would like it to be utilized,” Matt Borman, an official with Commerce’s Bureau of Industry and Security, said during a Sept. 27 defense industry conference hosted by IDEEA. “To anyone who's considering STA-eligible exports, please, please use them as opposed to having your U.S. supplier come in and go through the traditional licensing process.”
The State Department is monitoring whether the U.S. delivery of certain F-35 aircraft -- which were revealed this month to contain certain Chinese components -- violated export controls, senior agency official Mike Miller said. He said the Directorate of Defense Trade Controls is “certainly tracking” the case but declined to say whether the agency will issue any penalties. “As to what compliance actions we may be taking with the company,” Miller said, “I can’t speak to that in specific.”
As the Biden administration prepares to issue its long-awaited national security strategy, it’s also hoping to reduce barriers to sharing technology with allies and speed up its foreign military sales program, said Cara Abercrombie, a National Security Council official. Abercrombie, speaking during a Sept. 27 defense industry conference hosted by IDEEA, said she hopes these initiatives lead to more cooperation with allies, particularly as the U.S. and others continue to sanction Russia and send weapons to Ukraine.
Although President Joe Biden’s recent executive order on foreign direct investment isn’t expected to significantly change review outcomes, it sends a clear signal to industry about the U.S.’s FDI priorities and could help companies better understand whether they should submit a voluntary filing, law firms said this month. One firm said the Committee on Foreign Investment in the U.S. may use the order as further reason to reach out to businesses about non-notified transactions.
The Bureau of Industry and Security updated its restricted aircraft list with another Iranian-owned and -operated plane after it violated U.S. export controls, the agency said this week. BIS said the U.S.-origin cargo plane -- owned by Saha Airlines, which is operated by the Islamic Republic of Iran Air Force -- provided cargo flight services to Russia.
The Office of Foreign Assets Control announced two separate settlement agreements this week, fining a Switzerland- and a Monaco-based wealth management company for violating U.S. sanctions. OFAC said both companies committed violations due to “deficiencies” in their sanctions compliance practices.
The Office of Foreign Assets Control last week updated an Iran-related general license and guidance to expand the types of internet and communications services and exports that can be provided to Iran. Updated General License D2 “dramatically increases” U.S. support for internet freedom in Iran, a State Department official said, adding that the announcement brings U.S. sanctions guidance "in line with changes in modern technology.”
The Los Angeles and Long Beach ports again postponed by one month a new surcharge meant to incentivize the movement of dwelling containers (see 2110280031), the two ports announced Sept. 23. The ports had planned to begin imposing the fee in November 2021 but postponed it each week until July 29, when the ports announced their first one-month postponement (see 2207290053). The latest one-month extension delays the effective date until Oct. 21.