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Commerce Secretary Comments on Changes to U.S. Export Control Restrictions Aimed at Huawei

U.S. Commerce Secretary Wilbur Ross announced on 9 July at the Bureau of Industry and Security’s Annual Conference on Export Controls and Security certain changes to his department’s policy toward mainland Chinese telecommunications giant Huawei. Ross said that while Huawei will remain on the BIS Entity List the DOC would, in order to implement the president’s G-20 summit directive, now issue licences for sales to Huawei “where there is no threat to U.S. national security.”

Ross maintained that this announcement “does not change the scope of items requiring licenses from the Commerce Department, nor the presumption of denial.” He noted that the Entity List denies sensitive technologies to companies “endangering our national security and foreign policy interests” and described mainland China’s “civil−military fusion strategy” as a “very real threat.” He also described ZTE, another mainland Chinese telecom firm, as “the most monitored corporation in BIS history.”

In his address, Ross highlighted the new authorities afforded to BIS by the Export Control Reform Act of 2018 as well as the many enforcement actions taken by the agency. He mentioned, for example, civil penalties and criminal prosecutions of firms in mainland China, Russia, Pakistan, North Korea and Iran, adding that 49 mainland Chinese companies are among the 182 firms (including 49 Russian firms as well as firms in Pakistan and other countries) that have been added to the Entity List since 2017.

Ross also indicated that the membership of a new Emerging Technology Technical Advisory Committee will be announced soon in order to update U.S. export control regulations on emerging technologies and stated that BIS will be issuing interim regulations by mid-October “to ensure the viability of our IT and telecom providers.” Unusually for a member of the Trump administration, Ross observed that his department “strives for multilateral agreements so important controls are universally applied.” He concluded that BIS will need to continue to strike a proper balance between security needs and American commercial interests as “this becomes more and more complex.”

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