The Securities and Exchange Commission launched an investigation into Swedish telecommunications giant Ericsson's conduct in Iraq in 2019, the company said in a June 9 filing. The SEC told Ericsson it "has opened an investigation concerning the matters described in the company's 2019 Iraq investigation report." Ericsson responded that while "it is too early to determine or predict the outcome of the investigation," the company is "fully cooperating with the SEC."
A German think tank specialist in semiconductors' value chain vulnerabilities told the U.S.-China Economic and Security Review Commission he's concerned that the policy focus on bringing more production back to either the EU or the U.S. won't achieve its aims because policymakers aren't sure what those aims are.
The Commercial Customs Operations Advisory Committee (COAC) for CBP will next meet remotely June 29, CBP said in a notice. Comments are due in writing by June 24.
Lawyers are continuing to see an uptick in outreaches by the Committee on Foreign Investment in the U.S. related to non-notified deals, especially if they involve Chinese investors. Carl Valenstein, a CFIUS lawyer with Morgan Lewis, said some of his clients in the life sciences sector, even though they weren’t working with critical technologies, have recently been contacted by CFIUS.
The Drug Enforcement Administration is listing methoxetamine (MXE), a member of the arylcyclohexylamine class of drugs with dissociative anesthetic and hallucinogenic properties, similar to phencyclidine (PCP) and ketamine, under Schedule I of the Controlled Substances Act, it said in a notice published June 6. “This action imposes the regulatory controls and administrative, civil, and criminal sanctions applicable to schedule I controlled substances on persons who handle (manufacture, distribute, reverse distribute, import, export, engage in research, conduct instructional activities or chemical analysis with, or possess), or propose to handle, methoxetamine.” The listing takes effect July 6.
The Bureau of Industry and Security by now should have penalized Seagate Technologies for illegally exporting goods to Huawei, James Mulvenon, a China technology and military expert, wrote in a June 6 post for the Lawfare blog. Mulvenon said BIS’s “inaction” has emboldened other companies to export similar shipments and is indicative of a larger enforcement issue at BIS surrounding its foreign direct product rule for Huawei.
The State Department’s recent fine of a U.S. electro-optics equipment manufacturer (see 2202010058) highlighted a range of key takeaways for defense exporters, including the importance of the commodity jurisdiction process and recordkeeping, Torres Trade Law said in a June alert. The consent agreement also underscored the benefits of voluntarily disclosing violations, the firm said, which can significantly mitigate penalties.
The Bureau of Industry and Security's upcoming shift in its administrative enforcement policies could signal a more aggressive posture toward cracking down on illegal exports and may change how companies voluntarily disclose violations, a former BIS agent said. But some lawyers say the policies could represent a minor shift, and it may be too early to tell how they will affect compliance decisions.
The Bureau of Industry and Security is considering several major changes to its administrative enforcement authorities, including publicizing its charging letters before cases are resolved and increasing penalty amounts for export violations. The agency may also limit its use of no admit/no deny settlements, which allow companies to avoid admitting explicit wrongdoing.
The Uyghur Forced Labor Prevention Act and the likelihood that the EU will pass a due diligence directive requiring disclosure of forced labor risk for large companies are changing the paradigm of supply chain visibility, a top Labor Department official said during a webinar on human rights in global supply chains. Thea Lee, a long-time union official and now deputy undersecretary for international affairs in the Bureau of International Labor Affairs, said, "I do think that we are in a new era, and it will behoove most companies to start taking these steps to be able to have the eyes into their supply chain whether they are directly impacted right now by the EU directive or whether they are selling goods into the United States."