More Export Controls, Entity Listings, EOs Expected, Panelists Say
Businesses are relieved by the quasi-truce between China and the U.S., consultants and lawyers said on a trade panel last week, but those in the tech sectors expect more restrictions are coming in the near future.
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Paul Triolo, associate partner for China and technology policy lead at Albright Stonebridge, said, "Technology is one of those areas that’s going to continue to dog the relationship." Triolo said he's read that some additional export controls could be announced in coming weeks, as well as more companies added to the Entity List, such as those that make legacy chips. Thea Kendler, the BIS assistant secretary for export administration, recently told Congress BIS will survey industry players about the legacy chip supply chain (see 2401180028). He added, "We could see some tightening of licenses."
Triolo said he thought the outbound investment executive order could be published as early as the week of Feb. 26. He said an executive order on data security could be released in the "next couple of weeks." He said the administration has to choreograph when to release these policies.
The industry is waiting for implementation of the Information and Communication Technology Services (ICTS) supply chain rule. He said he expects BIS to issue rules affecting connected vehicles and Advanced Driver Assistance systems in cars. "For our companies, what happens then is, they’re increasingly caught in this crossfire between U.S. measures and compliance and then the Chinese reaction," he said at the Washington International Trade Association's annual conference.
Panelist Anna Ashton, director of U.S.-China relations at the Eurasia Group, said erecting barriers to trade with China "is part of a good defense," but that the U.S. needs to put more energy into encouraging trade linkages with partners that it does not see as a security threat.
Jeremie Waterman, president of the China Center at the U.S. Chamber of Commerce, said business "is very sober, very level-headed about where we are with China these days."
"I think business generally understands the need for an outbound investment regime," he added.
He said businesses appreciate that even when they don't always agree with the scope of national security export restrictions, that the administration "is trying to scope measures in a targeted way."
He also said the process for notice and comment has been thorough, giving businesses the "opportunity to explain to the administration the downsides … lost business, lost competitiveness and even potential boomeranging on U.S. national security interests."
He said he believes "2024 will be a year of largely defending the status quo" in trade with China.