The Bureau of Industry and Security shouldn’t renew the one-year authorizations it gave to certain foreign chip companies as part of its Oct. 7 China chip controls unless the agency makes “significant” changes to the restrictions when it finalizes the controls in the coming months, said Derek Scissors, a China policy expert with the American Enterprise Institute. Scissors said extending the licenses beyond their October expiration would “undermine” the Biden administration’s goal of denying China advanced semiconductor technology and unfairly advantage foreign companies over U.S. firms.
Exports to China
Sen. Marco Rubio, R-Fla, introduced a bill this week that could lead to new export controls on certain U.S. “genetic technology” destined to China. The Stopping Genetic Monitoring by China Act would add various types of “genetic sampling and testing kits, analytical technology, and software” to the Bureau of Industry and Security’s Commerce Control List, including:
The Senate this week voted to attach amendments to its version of the FY 2024 National Defense Authorization Act, including one that could establish a notification regime for certain outbound investments and another that could ban China, Russia, North Korea and Iran from investing in American farmland and agricultural businesses.
Commerce Secretary Gina Raimondo this week declined to say when she expects the Bureau of Industry and Security to finalize its Oct. 7 China chip controls (see 2210070049, saying it’s more important to her that the agency takes its time and gets the updated restrictions “right.” She also said she doesn’t see Chips Act funding and restrictions on American chips sales to China as contradictory and denied reports that the administration has delayed new export controls against China in an effort to limit damage to its relationship with Beijing.
The Bureau of Industry and Security is drafting a final rule to expand its nuclear nonproliferation controls on China and Macau. The agency sent the rule for interagency review July 24.
The Committee on Foreign Investment in the U.S. is investigating whether TuSimple Holdings is complying with a national security agreement between CFIUS and the U.S.-based self-driving truck and autonomous freight shipping technology company, TuSimple said. The company said it’s “cooperating with the inquiry,” which is examining “information shared by TuSimple U.S.” with its China-based businesses: Hydron and Hydron’s partners.
The U.S. “should move more quickly” to establish a new multilateral export control forum to restrict high tech exports to China now that the Wassenaar Arrangement has become less effective, said William Reinsch, a former Commerce Department official and current Scholl Chair in International Business at the Center for Strategic and International Studies. Reinsch said “multilateralism is the only viable approach to high-tech export controls,” adding that “existing structures are not adequate to the task” and must be replaced by other means for the U.S. and its trading partners to coordinate.
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Commerce Secretary Gina Raimondo, whose department is responsible for three of the four pillars in the Indo-Pacific Economic Framework, told a think tank audience that she is "determined to finalize agreements with all of these countries on all three pillars I’m managing" by a summit at the end of November. The IPEF, which does not liberalize tariffs but does seek to lower non-tariff barriers in its trade pillar, also includes a tax and anti-corruption pillar, an infrastructure and decarbonization pillar, and a supply chain pillar, which was already agreed to earlier this year.
The Treasury Department is seeking public comments as it renews an information collection that outlines certain financial restrictions against China-based Bank of Dandong, which is designated as a “primary money laundering concern.” The designation by the Financial Crimes Enforcement Network prohibits U.S. financial institutions from opening or maintaining certain correspondent accounts at the bank, and requires those financial institutions to “apply due diligence to correspondent accounts they maintain on behalf of foreign financial institutions that is reasonably designed to guard against the indirect use of those accounts by Bank of Dandong.” Comments are due Sept. 25.