Export Compliance Daily is providing readers with the top stories from last week in case you missed them. You can find any article by searching for the title or by clicking on the hyperlinked reference number.
The Commerce Department is proposing new rules that could require U.S. cloud service providers and their foreign resellers to follow know-your-customer (KYC) requirements, a step the agency said would prevent those services from being used to aid cyberattacks and to train artificial intelligence models that threaten U.S. national security. The proposed regulations are specifically aimed at preventing “foreign malicious cyber actors” from using U.S. infrastructure-as-a-service products to steal American intellectual property and sensitive data, commit espionage, and train large AI models for cyberattacks on U.S. critical infrastructure.
The Bureau of Industry and Security is undergoing a restructuring to separate its licensing work from its efforts to evaluate and protect emerging and foundational technologies, said Eileen Albanese, director of the Office of National Security and Technology Transfer Controls. She said the agency plans to hire at least three new senior officials to usher in the reorganization, which will help BIS meet its “broader mandate.”
The Bureau of Industry and Security is preparing to announce more “significant” export penalties and corporate resolutions this year, said Matthew Axelrod, the agency’s top export enforcement official. He also said exporters should see more export-related indictments as part of a joint effort with DOJ, and he continued to pitch a BIS funding boost, which would help it hire more export enforcement agents.
Companies should expect the Bureau of Industry and Security to announce new export controls this year restricting certain U.S. person activities involving military and military intelligence end uses and end users, a former BIS official said.
The leaders of the Senate Homeland Security and Governmental Affairs Subcommittee on Emerging Threats and Spending Oversight have asked the Government Accountability Office to assess the effectiveness of new export controls aimed at preventing China from obtaining advanced computing chips and the equipment to manufacture them.
The two authors of a bipartisan bill to boost U.S. technology competitiveness were lukewarm this week about the prospect of allocating more export control resources to the Commerce Department and stopped short of promising it more money, with one calling on the agency to be more efficient with what it has. And while they said they support Commerce’s updated China-related semiconductor export controls, they also said the U.S. should devote as much attention to expanding trade with close allies as it does to restricting trade with adversaries.
Export Compliance Daily is providing readers with the top stories from last week in case you missed them. You can find any article by searching for the title or by clicking on the hyperlinked reference number.
Behrouz Mokhtari of McLean, Virginia, and Tehran pleaded guilty Jan. 9 to two conspiracies to violate U.S. sanctions on Iran "by engaging in business activities on behalf of Iranian entities" without getting a license from the Treasury Department's Office of Foreign Assets Control, DOJ announced Jan. 9. Mokhtari will forfeit money, property and assets obtained from the schemes, including a Campbell, California, home, and a money judgment of over $2.8 million, DOJ said. The defendant faces a maximum of five years in prison for each of the two conspiracy counts.
Electronics distribution company Broad Tech System and its president and owner, Tao Jiang of Riverside, California, pleaded guilty Jan. 11 to participating in a conspiracy to illegally ship chemicals made or distributed by a Rhode Island-based company to a Chinese firm with ties to the Chinese military, the U.S. Attorney's Office for the District of Rhode Island announced. Jiang and Broad Tech admitted to violating the Export Control Act and conspiring to commit money laundering.