Amsterdam-based multinational conglomerate Koninklijke Philips will pay more than $62 million to settle charges it violated the Foreign Corrupt Practices Act related to its sales of medical diagnostic equipment in China, the SEC announced. Without admitting guilt, Philips agreed to pay $15 million in civil penalties and over $47 million in disgorgement and prejudgment interest.
Exports to China
The European Commission adopted two measures May 12 that "renew, adjust and extend the scope" of existing antidumping measures on imports of high tenacity yarn of polyester from China, the Directorate-General for Trade announced. Various investigations found that revoking the measures would lead to goods being dumped into the EU, causing harm to the domestic yarn industry, DG Trade said. The commission extended the duties for another five years, increasing them to between 6.9% and 23.7%, and also applied them to an additional importer, Hailide.
The U.S. should deploy “targeted and responsible” trade measures to restrict Chinese access to sensitive technologies, not ones that cut off a broad range of transactions between American and Chinese firms, U.S. Chamber of Commerce CEO Suzanne Clark said during an industry conference this week.
The chairman of the powerful House Rules Committee used his perch to promote a bill he sponsored that would allow the president to lower duties on non-import-sensitive goods made by a country that lost exports due to coercive actions; increase duties on imports from the "foreign adversary" committing the coercion; and allow the U.S. to more easily facilitate trade, including exports, with the coerced parties (see 2302230021).
Sen. Marco Rubio, R-Fla., reintroduced a bill this week that could require the administration to report on foreign investment in the U.S. space industry. The Space Protection of American Command and Enterprise Act would mandate an interagency annual report to Congress on foreign investment in “U.S. space exploration, manufacturing, telecommunications, and national security, including the countries of origin, sources of funds” and other information. It would also require the White House’s National Space Council to report on “investment competition” -- specifically from China and Russia -- aimed at leapfrogging “American economic leadership in commercial space,” including through intellectual property theft.
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 Biden administration’s upcoming executive order on outbound investment is “likely to be coming in the next few weeks,” said Jeannette Chu, vice president for national security policy at the National Foreign Trade Council. Chu, speaking during a May 11 Materials and Equipment Technical Advisory Committee meeting, said she expects the new screening tool to be unveiled around or soon after the G-7 meetings in Japan next week.
A former Pentagon official expected to testify before Congress May 11 said U.S. officials for years have “refused” to fix failures in its export control system that allow China to acquire sensitive technologies. Stephen Coonen, who spent nearly 14 years in the Defense Technology Security Administration, including as its senior foreign affairs adviser for China, said he resigned from the agency in 2021 to protest the Bureau of Industry and Security’s “willful blindness” surrounding its export policies.
The U.S. District Court for the Southern District of New York should toss the U.S. claim that FTX crypto-exchange founder Sam Bankman-Fried violated the Foreign Corrupt Practices Act's anti-bribery provision since the government failed to allege an essential element of the FCPA, Bankman-Fried said in a motion to dismiss. The U.S. said payments were made to unfreeze assets belonging to cryptocurrency firm Alameda Research but didn't say payments were made to "secure or retain a contract with a foreign government agency, gain an unfair advantage, or achieve an objective of the sort addressed in the FCPA’s text or legislative history or in relevant caselaw" (U.S. v. Samuel Bankman-Fried, S.D.N.Y. # 22-00673).
A bipartisan group of lawmakers this week reintroduced a bill that could establish an outbound investment screening regime to prevent China and others from illegally acquiring sensitive U.S. technology.