The recent U.S. decision to increase sanctions and export controls on Russia, although largely narrow, could have significant implications for exporters doing business in Russia, law firms said. U.S. companies should pay close attention to new restrictions on certain controlled services and the potential impacts of the restrictions on disclosure and reporting requirements, the firms said.
The U.S., the European Union, the United Kingdom and Canada announced sanctions against China for human rights abuses in an internationally coordinated effort to condemn China’s treatment of its Uyghur population. The sanctions, announced March 22, target officials and an entity in the Xinjiang Uyghur Autonomous Region for leading the repression and detention of Muslim minorities.
The Commerce Department should expand export restrictions on China’s top chipmaker to prevent it from accessing a broader range of semiconductor manufacturing equipment, two U.S. lawmakers said. In a March 18 letter to Commerce Secretary Gina Raimondo, Sen. Marco Rubio, R-Fla., and Rep. Michael McCaul, R-Texas, asked the agency to apply the foreign direct product rule to China’s Semiconductor Manufacturing International Corporation, which would restrict the company’s ability to import certain foreign-made semiconductor equipment that is built with or that incorporates U.S. technology. The move would subject SMIC to similar restrictions imposed by the Bureau of Industry and Security on other Chinese companies on the Entity List, including Huawei (see 2012210044).
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Don Graves, President Joe Biden’s nominee for deputy commerce secretary, said export restrictions shouldn’t be removed from Huawei and that the Commerce Department should do more to promote U.S. leadership at international technology standards setting bodies. Graves also said he is open to imposing more export controls and other restrictions against China for human rights violations.
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The Bureau of Industry and Security denied a New Jersey man export privileges after he illegally exported electronic components to Russia, BIS said in a March 8 order. BIS denied Alexander Brazhnikov export privileges for 15 years. Brazhnikov pleaded guilty to the charges in 2015 and was sentenced to 70 months in prison in 2016 (see 1607010044).
The Bureau of Industry and Security issued new restrictions on exports to Myanmar and added four entities to the Entity List in response to the country’s military-led coup last month (see 2102110020). The restrictions, which take effect March 8, increase controls on certain “sensitive” items, remove certain license exceptions, impose a more strict licensing policy and subject Myanmar to BIS’s military end-use and end-user restrictions (see 2012220027), according to a final rule released March 4.
The Bureau of Industry and Security outlined its licensing policy for the 14 additions to the Entity List announced earlier this week (see 2103020067) and made several corrections to the list, a final rule released March 2 said. BIS will impose a license requirement for all items subject to the Export Administration Regulations that are destined to the 14 Russian, German and Swiss entities, the rule said. The license requirement will also apply if any of the entities acts as a “purchaser, intermediate consignee, ultimate consignee, or end-user,” BIS added, and no license exceptions will be available. All exports and reexports that now require a license as a result of the Entity List additions but were aboard a carrier to a port as of March 4 may proceed to their destinations under the previous eligibility, BIS said.
The U.S. sanctioned a host of Russian officials and agencies, will add 14 entities to the Entity List and will increase restrictions on exports of military-related goods to Russia in response to the poisoning and imprisonment of Russian opposition leader Alexei Navalny. The increased export controls will also remove certain license exceptions for shipments to Russia and will impose stricter license review policies for certain sensitive goods, the State Department said March 2.