The Federal Maritime Commission is looking to revoke a Miami freight forwarder’s ocean transportation intermediary license after its owners illegally exported nearly 600 stolen outboard motors from the U.S., including by providing false shipping documents to CBP. The company, Netcycle Trading, told the FMC it should be allowed to keep the license, but the FMC is asking its administrative law judge to rule against the forwarder after its president submitted “misleading” comments to the commission that downplayed her role in the scheme.
While the U.S. and the EU are increasingly aligning their views on China, the two sides still don’t yet fully agree on how to use export controls, investment restrictions and other economic security tools to respond to economic and national security threats posed by Beijing, panelists during a Center for a New American Security event said last week. They also said they expect challenges facing American businesses in China to continue to grow, particularly if the U.S. pursues more trade restrictions and as Beijing builds out its anti-foreign sanctions laws.
Senior U.S. sanctions and export control officials recently warned a group of American CEOs to do more due diligence on their semiconductor shipments, telling them Chinese suppliers are frequently sending their products to Russia.
The Bureau of Industry and Security made its first update to its new boycott Requester List, a list of entities that have asked other companies to boycott goods from certain countries in violation of the Export Administration Regulations. The agency said freight forwarders, banks and other entities involved in international trade transactions should review the list to help them comply with BIS antiboycott rules.
Russia has been able to sustain its war effort against Ukraine because of its ability to evade Western export controls on key military parts and semiconductors, said Maria Snegovaya, a senior fellow with the Europe, Russia and Eurasia Program at the Center for Strategic and International Studies. She said Russia is importing large amounts of controlled items from China and continuing to indirectly buy from Eastern European nations like Turkey through transshipment tactics and shell companies.
The U.S. fined an Italian animation company $538,000 after it violated U.S. sanctions by outsourcing work to an animation studio owned by the North Korean government, the Office of Foreign Assets Control said in an enforcement release. The company, Mondo TV, illegally used U.S. banks to send money to the studio through wire transfers, OFAC said.
Indiana University will avoid a fine but must meet several government-imposed export compliance commitments after it illegally exported genetically modified fruit flies carrying a controlled toxin, the Bureau of Industry and Security announced this week. The school voluntarily disclosed the illegal exports and admitted to 42 violations of the Export Administration Regulations, BIS said, which helped IU avoid a monetary penalty.
The Biden administration is working with lawmakers on a bill that could give the Bureau of Industry and Security legal authority to restrict certain exports of artificial intelligence software to foreign adversaries, said Tarun Chhabra, the NSC’s senior director for technology and national security.
The Biden administration is close to issuing a new national security memorandum on artificial intelligence, which is expected to address technology security issues surrounding advanced AI models and related software, National Security Council officials said this week.
The Treasury Department last week issued a set of proposed regulations that could introduce new prohibitions and notification requirements on U.S. investments in China, Hong Kong and Macau as the Biden administration works toward finalizing the new rules before year-end (see 2405080039). The proposed rule, which builds on an advance notice of proposed rulemaking Treasury issued in August (see 2308090066), outlines how the agency would implement new bans on certain types of outbound American investments in China’s semiconductor, quantum and artificial intelligence industries, as well as notification requirements for other, broader investments in China’s chip and AI sectors.