DOJ this week unsealed indictments of six people for trying to illegally ship sensitive items from the U.S., including shipments of dual-use technologies and aircraft parts to Russia, isostatic graphite to Iran and trade secrets to China. The charges are the first enforcement actions brought by the Disruptive Technology Strike Force, a group launched by DOJ and the Commerce Department in February to investigate and prosecute criminal export violations (see 2302160019).
The Bureau of Industry and Security issued a temporary denial order this week against two Russian nationals, their Florida company, a Maldives business and a Russian airline for a scheme to illegally supply aviation parts to Russia. Oleg Sergeyevich Patsulya and Vasilii Sergeyevich Besedin used their Florida-based company MIC P&I to try to export to Russia more than $2 million worth of U.S. aircraft components, including Goodrich brake assemblies, in a procurement network that went through Intermodal Maldives and eventually to Russia’s JSC Smartavia Airlines.
The House Foreign Affairs Committee could soon consider legislation that would harmonize various U.S. sanctions lists in a bid to help agencies better reach consensus when reviewing export license applications. Rep. Michael Waltz, R-Fla., said the Commerce Department has an outsized vote in adjudicating applications of sensitive exports and should be required to more carefully weigh input from other agencies, including the Defense and State departments.
The Bureau of Industry and Security needs much more funding to carry out its export control work, lawmakers and former officials said during a House hearing this week. Kevin Wolf, a former senior official at BIS, said Congress should consider doubling -- perhaps quadrupling -- the agency’s resources.
The Commerce Department again renewed a temporary export denial order for Mahan Airways because the airline continues to violate the order and the Export Administration Regulations. Mahan Airways has been on the banned list since 2008, and Commerce in its May 5 notice said the Iranian airline has continued to fly to and from Iran from Russia and China in violation of U.S. export controls. It also said the airline in April reportedly began direct flights from Iran to Minsk, Belarus, and also has helped repair planes belonging to Russia's Aeroflot, which is also subject to a temporary denial order (see 2303300013). The latest renewal for Mahan is for 180 days from May 5.
Although the U.S. continues to impose new sanctions and export controls against Russia, the Commerce Department’s $300 million penalty assigned to Seagate Technologies last month signals that the U.S. is increasingly prioritizing enforcement, particularly against China, law firms said this month. They also said the fine shows that Commerce is looking to strictly enforce its foreign direct product rule restrictions, even for violations of the rule that may not be obvious.
A bill introduced in the Senate last week could create new export authorizations -- including a new open general license for certain defense exports and a new license exception for dual-use goods -- to expedite shipments to Australia, Canada and the U.K. The legislation, introduced by Sens. Jim Risch, R-Idaho, and Bill Hagerty, R-Tenn., also would allow the State Department to hire more export license review officers, create a “fast-track” foreign military sales process, reduce barriers to information sharing within the Australia-U.K.-U.S. partnership and more.
The Census Bureau this week previewed its new response code to prepare Automated Export System users ahead of a potential electronic export filing requirement for certain U.S. Munitions List items.
The Bureau of Industry and Security this week proposed new export controls on automated peptide synthesizers that may be used to produce biological weapons (see 2304170010). Although several U.S. companies and a Chinese academy last year warned BIS against imposing new license requirements, the agency said the synthesizers qualify as emerging or foundational technologies and may need to be restricted.
The Bureau of Industry and Security on April 19 fined Seagate Technology $300 million for violating U.S. export controls against Huawei in what it said is the “largest standalone administrative penalty in BIS history.” The agency said the California-based company and its branch in Singapore sold more than 7 million export-controlled hard disk drives to Huawei in violation of the BIS foreign direct product rule.