China's Unreliable Entity List Has Posed Risks and Uncertainties To
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Smartphones and Foreign Policy: ZTE Sanctions Explained Law360, New York (March 18, 2016, 11:07 AM ET) -- on Tuesday, March 8, the U.S
Portfolio Media. Inc. | 111 West 19th Street, 5th Floor | New York, NY 10011 | www.law360.com Phone: +1 646 783 7100 | Fax: +1 646 783 7161 | [email protected] Smartphones And Foreign Policy: ZTE Sanctions Explained Law360, New York (March 18, 2016, 11:07 AM ET) -- On Tuesday, March 8, the U.S. Department of Commerce placed Chinese telecommunications equipment manufacturer ZTE Corp. and three affiliates on the Entity List, prohibiting exports to ZTE Corp. of items subject to the Export Administration Regulations, including U.S.-origin hardware, software and technology. The designation comes in response to ZTE’s apparent reexport of controlled dual-use items from the United States to Iran in violation of U.S. law, which the Commerce Department found was “contrary to the national security and foreign policy interests of the United States.” Companies in the telecommunications sector — including U.S. companies Richard L. Matheny III and non-U.S. companies that trade in U.S.-origin items — are advised to evaluate their customer base to ensure that they are not supplying U.S.- origin items to ZTE or its affiliates, whether directly or indirectly through intermediaries. ZTE’s Impact in the Global Economy This designation will have a profound impact on the telecommunications sector in the United States and abroad. Deeply embedded in the global supply chain for high-end telecommunications and computer networking equipment, ZTE is the world’s fourth largest supplier of smartphones with Jacob R. Osborn approximately 7 percent of the U.S. market share. ZTE has described U.S. companies Microsoft Corp., Intel Corp., IBM, Avaya Inc. -
Responses to Questions for the Record for Governor Gina Raimondo
Responses to Questions for the Record for Governor Gina Raimondo Ranking Member Roger Wicker Question 1: Gov. Raimondo, supply chain security is a growing challenge for the business community and the federal government needs to coordinate its efforts and work with the private sector to protect our interests. Will you commit to reviewing the Department of Commerce’s recently issued Information and Communications Technology and Services (ICTS) Supply Chain interim final rule to ensure it is reasonable and is part of a coordinated federal strategy to secure the supply chain? Yes or no? Response: With experience in both the private and public sector, I know how critical it is to protect the interest of all Americans, consumers and constituents. If confirmed, I will work with the professionals at the Department and conduct a thorough review of the recently issued ICTS Supply Chain interim final rule as well as the Department’s other supply chain activities. Question 2: The Consolidated Appropriations Act of 2021, which included COVID-19 stimulus and relief funding, included $1.3 billion for broadband grants--$1 billion for Tribal areas and $300 million for broadband deployment in unserved areas. Those grants will be administered by the Department of Commerce’s National Telecommunications and Information Administration (NTIA). The purpose of this question is to ensure that those broadband resources are targeted to unserved areas. The Consolidated Appropriations Act of 2021 included $1.3 billion for broadband grants--$1 billion for Tribal areas and $300 million for broadband deployment in unserved areas. Those grants will be administered by the Department of Commerce’s National Telecommunications and Information Administration (NTIA). -
US Trade Compliance Training for China Operations
10/29/2020 US Trade Compliance Training for China Operations Wednesday, 28th October 2020 US Policy and Legislation Impacting Doing Business with China . Regulatory Impact Tech Leader . Extreme scrutiny of Chinese interest investments in US -ship . Critical assessment of UK/EU relationships with China Supply Regulatory Chain ECRA FIRRMA Impact in connection with UK/EU investments in the US . Retroactive review of investments in US Trusted partners . Key companies in China on restricted party lists or at risk: Huawei, Tencent, SMIC, Sinochem and others . Control exports of emerging and foundational . Policy Objectives . National Defense Authorization technologies (currently no license required) . Slowing down Chinese Act for Fiscal Year 2019 . Control exports for military end-uses and end-users in leadership in emerging . Companion legislation: approaching China technology the problem from different angles . Prohibit non-US made products with US technology, . Maintaining integrity of US . Export Controls Reform Act (ECRA) software or equipment from going to Huawei supply chains • BIS – Reviews exports, reexports and . Treat Hong Kong like mainland China for export . Favor trusted partners aligned transfers (in country) controls with US national security and . Foreign Investment Risk Review . Prohibit Chinese products use for US government foreign policy interests Modernization Act (FIRRMA) procurements • CFIUS – Reviews foreign investment . Prohibit Huawei product in US telecom system in the US . Prohibit Chinese apps that collect personal data of US citizens squirepattonboggs.com 2 1 10/29/2020 Agenda o Emerging and Foundational Technology o Targeted Entities o Designated Entity Direct Product Rule o Military End-use and End-user Rule o Hong Kong Policy o Compliance Training is Critical Export Control Reform Act of 2018 Emerging Technology ANPRM . -
Table of Contents
Last updated: April 1, 2021 Timeline of Executive Actions on China (2017–2021) This document covers executive actions taken by the Administration of President Donald Trump directed at China. Executive actions include (1) executive orders from the president and (2) other significant measures taken by federal agencies relating to U.S.-China policy. Between 2017 and 2021, the Trump Administration issued eight executive orders that primarily involved China. The Trump Administration issued an additional seven executive orders that did not explicitly target China but affected key policy areas relating to the U.S.-China relationship.1 In addition to these 15 executive orders, the Commission identified 116 China-related measures taken by White House and other executive departments and agencies from 2017 to 2021. A list of all currently identified executive actions, including both executive orders and measures taken by executive departments and agencies, can be found in the appendix of this document. This document is based upon press releases by the White House and by executive departments and agencies. Table of Contents Executive Orders Directly Targeting China .................................................................................................. 2 Executive Orders on Issues Critical to the U.S.-China Relationship ............................................................ 6 Appendix: Executive Actions on China (2017–2021) ................................................................................ 10 1 Executive orders in this -
Semiconductors: U.S. Industry, Global Competition, and Federal Policy
Semiconductors: U.S. Industry, Global Competition, and Federal Policy October 26, 2020 Congressional Research Service https://crsreports.congress.gov R46581 SUMMARY R46581 Semiconductors: U.S. Industry, Global October 26, 2020 Competition, and Federal Policy Michaela D. Platzer Semiconductors, tiny electronic devices based primarily on silicon or germanium, enable nearly Specialist in Industrial all industrial activities, including systems that undergird U.S. technological competitiveness and Organization and Business national security. Many policymakers see U.S. strength in semiconductor technology and fabrication as vital to U.S. economic and national security interests. The U.S. semiconductor John F. Sargent Jr. industry dominates many parts of the semiconductor supply chain, such as chip design. Specialist in Science and Semiconductors are also a top U.S. export. Semiconductor design and manufacturing is a global Technology Policy enterprise with materials, design, fabrication, assembly, testing, and packaging operating across national borders. Six U.S.-headquartered or foreign-owned semiconductor companies currently operate 20 fabrication facilities, or fabs, in the United States. In 2019, U.S.-based semiconductor Karen M. Sutter manufacturing directly employed 184,600 workers at an average wage of $166,400. Specialist in Asian Trade and Finance Some U.S.-headquartered semiconductor firms that design and manufacture in the United States also have built fabrication facilities overseas. Similarly, U.S.-headquartered design firms that do not own or operate their own fabrication facilities contract with foreign firms located overseas to manufacture their designs. Much of this overseas capacity is in Taiwan, South Korea, and Japan, and increasingly in China. Some Members of Congress and other policymakers are concerned that only a small share of the world’s most advanced semiconductor fabrication production capacity is in the United States. -
June 2020 Trade Bulletin
June 8, 2020 Highlights of This Month’s Edition • Bilateral trade: U.S. exports to China reached $8.6 billion in April 2020, the first year-on-year increase since January 2020. • Bilateral policy issues: On May 28, the National People’s Congress approved a plan to impose a national security law on Hong Kong, sparking protests in the territory; the Trump Administration declared its intention to begin revoking Hong Kong’s special status in U.S. law; two final rules from the Department of Commerce’s Bureau of Industry and Security (BIS) add to the Entity List Chinese entities involved in human rights abuses and facilitating military use of U.S. technology; BIS also strengthens controls over semiconductor exports to Huawei; Chinese companies look to other capital markets as the United States tightens scrutiny on Chinese securities. • In Focus – Two Sessions 2020: Convening in Beijing to set national-level priorities, China’s top leaders abandoned the country’s GDP growth target in favor of measures supporting employment and social stability, unveiled large-scale economic stimulus policies, and announced an ambitious legislative agenda. Contents Bilateral Trade ............................................................................................................................................................2 U.S. Goods Exports to China Up in April 2020, but Outlook Uncertain ...............................................................2 Bilateral Policy Issues ................................................................................................................................................3 -
Huawei and U.S. Law
Huawei and U.S. Law February 23, 2021 Congressional Research Service https://crsreports.congress.gov R46693 SUMMARY R46693 Huawei and U.S. Law February 23, 2021 Huawei Technologies Co., Ltd. (Huawei) has grown to be the world’s largest telecommunications equipment manufacturer since its founding in 1987 by a former engineer in Stephen P. Mulligan China’s People’s Liberation Army. The Shenzhen, China-based company has become the focus Legislative Attorney of a host of legal actions that seek to protect the United States’ national security and economy. In 2012, the House Permanent Select Committee on Intelligence (HPSCI) released a report describing the potential counterintelligence and security threats posed by Huawei’s access to U.S. Chris D. Linebaugh telecommunications systems. Senior officials in the Trump Administration asserted that Legislative Attorney Huawei’s products present an inherent security threat because the Chinese government can force Huawei to share confidential information or create “backdoors” by which the Chinese government could access Huawei systems. Huawei denies that its products create a security threat, and third-party analysts have not reached uniform conclusions about the security of Huawei systems. Given the security debate, Congress and the executive branch have initiated a variety of legal efforts to limit Huawei’s access to international supply chains, telecommunications systems, and markets. These legal actions have evolved from narrow restrictions on federal spending to an effort to remove Huawei equipment from domestic and international telecommunications networks. After HPSCI’s 2012 report, the United States enacted several laws that restrict federal procurement of, and grant and loan spending on, Huawei systems. -
The Semiconductor Industry Into Its Trade War with China
WORKING PAPER 20-16 How the United States marched the semiconductor industry into its trade war with China Chad P. Bown December 2020 ABSTRACT The US-China trade war forced a reluctant semiconductor industry into someone Chad P. Bown is else’s fight, a very different position from its leading role in the 1980s trade the Reginald Jones Senior Fellow at the conflict with Japan. This paper describes how the political economy of the Peterson Institute global semiconductor industry has evolved since the 1980s. That includes both for International Economics. a shift in the business model behind how semiconductors go from conception to a finished product as well as the geographic reorientation toward Asia of demand and manufactured supply. It uses that lens to explain how, during the modern conflict with China, US policymakers turned to a legally complex set of export restrictions targeting the semiconductor supply chain in the attempt to safeguard critical infrastructure in the telecommunications sector. The potentially far-reaching tactics included weaponization of exports by relatively small but highly specialized American software service and equipment providers in order to constrain Huawei, a Fortune Global 500 company. It describes potential costs of such policies, some of their unintended consequences, and whether policymakers might push them further in the attempt to constrain other Chinese firms. JEL: F13 Keywords: Export restrictions, supply chains, national security, semiconductors, Huawei, US–China trade relations Note: A revised version of this paper will be published in the East Asian Economic Review. It stems from a keynote given at the Organisation for Economic Co-operation and Development’s Global Forum on Productivity 2020. -
Rise of the "Big 4" the Semiconductor Industry in Asia Pacific
Rise of the "Big 4" The semiconductor industry in Asia Pacific Table of Contents The Asia Pacific "Big 4" 1 On the road to recovery 6 The emergence of "multi-markets" 13 Resilience is key 16 Self-sufficiency takes time 18 Too big to ignore 24 The semiconductor industry in Asia Pacific | The Asia Pacific "Big 4" 1 The semiconductor industry in Asia Pacific | The Asia Pacific "Big 4" The Asia Pacific "Big 4" Rise of "Big 4" in semiconductor Driven by government support, revenue and each have several global vast market and increasing R&D semiconductor giants. Asia Pacific is spending, China, Japan, South Korea also the world's biggest market for and Taiwan together have become semiconductors, accounting for 60% the "Big 4" semiconductor players in of global semiconductor sales, within Asia Pacific, holding four of the top which China alone accounts for over six spots by overall semiconductor 30%. Figure 1: Semiconductor revenue by country (Top 6) : Taiwan (Province of China) 6% South Korea 19% United States 47% Japan 5% China 5% The Netherlands 4% Source: SIA Figure 2: Top 10 Asian semiconductor vendors by revenue in 2019 (USD million) 2019 Revenue Company Country/Region (USD million) Samsung Electronics 52,214 South Korea TSMC 34,632 Taiwan (Province of China) SK hynix 22,478 South Korea Hisilicon 11,550 China Kioxia 8,797 Japan Sony 8,654 Japan MediaTek 8,066 Taiwan (Province of China) Renesas 6,755 Japan SMIC 3,014 China ROHM 2,803 Japan Source: Company reports 2 The semiconductor industry in Asia Pacific | The Asia Pacific "Big 4" The semiconductor value chain is long and involves many specialized fields: equipment, Electronic Design Automation software (EDA), Intellectual Property core (IP), Integrated Device Manufacturer (IDM and fabless), foundry and Outsourced Semiconductor Assembly & Test (OSAT). -
Risk Profile: Ant Technology Group
RISK PROFILE: ANT TECHNOLOGY GROUP September 6, 2020 Summary of Risk Factors 1. Failed MoneyGram Acquisition in the U.S 2. Role in Mass Detention and Surveillance in the Xinjiang Uyghur Autonomous Region (XUAR) 3. Military Dual-Use Potential 4. Participation in Social Credit System Construction 5. Data Collection and Privacy Concerns 6. Chinese Government Ties and Influence 7. Vulnerability to Escalating Geopolitical Tensions 1 Background Ant Technology Group (Ant Group), formerly known as Ant Financial Services Group, is a partially owned (33%) subsidiary of Chinese e-commerce giant Alibaba Group Holding (BABA: NYSE) that primarily provides financial technology (fintech) products and services. The company’s recent name change (in June 2020) has been characterized as intended to reflect better its transition from a financial services provider to a global technology provider that connects businesses across industries.1 Of Ant Group’s 1.2 billion users, the vast majority (900 million) reside in mainland China, where the company’s estimated $150 billion market capitalization is derived from a 53.8% share of China’s mobile payment market. Ant Group’s Alipay payment platform is active in 50 countries, supports 27 currencies, and currently maintains partnerships with over 250 overseas financial institutions and payment solution providers that primarily support Chinese travelers and foreign customers using Chinese e-commerce sites. In contrast, Ant Group’s largest competitor PayPal serves 346 million active users across 190 countries and supports 25 currencies, with about 4 million U.S. users.2 PayPal’s valuation at the time of its IPO in 2015 was $46.6 billion. -
Global Encryption, Cloud & Cyber Export Controls
EARN CLE CREDITS September 10–11, 2020 (Pacific Daylight Time) Virtual Conference 10th Annual Advanced Forum on GLOBAL ENCRYPTION, CLOUD & CYBER EXPORT CONTROLS The Premier Event for the Global Trade Controls Professionals to Stay Compliant with the Changing Regulations Keynote Speakers: What’s New for 2020: • Navigating the enforcement landscape and increased use of the entity list Honorable Nazak Nikakhtar Assistant Secretary for Industry and • Impact of TikTok and We Chat on Citizen Privacy Analysis, International Trade Administration • Military end use restrictions on mass market encryption and software U.S. Department of Commerce • Discussing the impact of new, emerging and foundational technologies regulations Deborah Curtis Chief Counsel for Industry and Security • Anticipating Wassenaar changes to overcome cybersecurity challenges U.S. Department of Commerce • How to manage your compliance program after COVID-19 • Assessing the impact of human rights guidelines to combat overuse of cyber-surveillance products and services Benchmark with Senior Industry Leaders from: • Cisco Systems • Hitachi • Spirent Gain Country Specific Guidance: • Cyxtera • McAfee Communications • • Latest developments in CHINA’s encryption and cyber laws • Dell • Microsoft Qualcomm • • • Ericsson • Oracle Verizon Focus on ASIA export controls – INDIA, JAPAN, KOREA and HONG KONG • Google • Siemens • EUROPEAN UNION Dual-Use trade controls update • Encryption requirements and export controls laws in GERMANY Supporting Sponsor: Associate Sponsors: a C5 Group Company Register Now | AmericanConference.com/Encryption | 888 224 2480 Business Information in a Global Context COMMENT-DOTS quote-leftBest conference for legal, technical, operational encryption, cybersecurity issues and best practices. quote-right Senior Manager, Global Export Trade, Cisco The Only Conference that Focuses on Global Regulatory Developments quote-leftAppreciated the workshops in Encryption, Cloud Computing and and the depth of information along with the topics covered. -
The Next Generation Problem: the Ups and Downs of Sweden’S Huawei Ban Johannes Nordin
Issue Brief February 18, 2021 The Next Generation Problem: The Ups and Downs of Sweden’s Huawei Ban Johannes Nordin After months of pending legal challenges, Sweden proceeded with the long-delayed 5G-frequency auctions in January this year, finally allowing Swedish telecom providers to continue the 5G-rollout; however, still without partnerships with Chinese 5G-equipment provider Huawei Technologies, which remains banned from Swedish networks on national security grounds. The ban was upheld in court on February 09 and has now put Stockholm on an open collision course with Beijing, which has threatened retaliation against Swedish businesses in China. In completely excluding Huawei, Sweden has, atypically, joined ranks with the U.S., the UK, Japan, New Zealand, and Australia, willingly or not getting pulled into the fray of the Sino-American rivalry. On the sidelines of a play involving government officials, national intelligence services, Swedish industry, telecom providers, Brussels, Washington, and Beijing, other European states are now keenly observing the Swedish experience with interest. Will Beijing make a discouraging example of Stockholm, or will the latter call bluff? Whatever the final answer may be, it is sure to set a precedent. To this end, this Issue Brief aims to explore Sweden’s experience thus far and outline the possible implications for the future. A Year in Review: guidelines and coordination – a toolbox– leaving practical enforcement to the member states, stopping In January 2020, the European Commission short of the