The Little Regulation That Will Make A Big Change In How You Do Business: Department Of Commerce To Establish New Export Controls On Emerging Technologies

Author:Mr Reid Whitten, J. Scott Maberry, Curtis M. Dombek and Lisa C. Mays
Profession:Sheppard Mullin Richter & Hampton
 
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Key Takeaways:

Emerging technology sectors will soon be subject to new export controls. Affected sectors include biotech, computing, artificial intelligence, positioning and navigation, data analytics, additive manufacturing, robotics, brain-machine interface, advanced materials, and surveillance. New export controls on these sectors will likely require companies to obtain a license to export products to China and other destinations, and impose restrictions on sharing information with foreign nationals. These sectors will also be added the list of industries subject to enhanced foreign investment scrutiny by the U.S. Committee on Foreign Investment in the United States (CFIUS). The U.S. government has invited comments on the criteria to be used to establish new controls. The deadline for comments is December 19, 2018. Export controls and other regulations often lag a step or two behind the times. That trend has accelerated with the pace of technological advancement. As a result, for many years, technical know-how in many cutting-edge technical fields has not been subject to export controls. This has meant that many commercial technical innovations could be freely exported without significant restrictions. As long as they were not designed for a military application, and no encryption technology involved, many new ideas developed in the United States were simply unaccounted for in the U.S. Export Administration Regulations (EAR).

But the U.S. Department of Commerce, Bureau of Industry and Security (BIS) is about to make up a lot of ground in a single, large leap.

The Controls

On Monday November 19, 2018, BIS published an invitation to comment on the criteria for establishing new export controls on what it calls "emerging and foundational technologies." The new controls are authorized under the Export Control Reform Act of 2018 and the Foreign Investment Risk Review Modernization Act of 2018 (known as FIRRMA). The list of technology fields targeted for review is as follows:

Biotechnology Artificial intelligence (AI) and machine learning technology Position, Navigation, and Timing (PNT) technology Microprocessor technology Advanced computing technology Data analytics technology Quantum information and sensing technology Logistics technology Additive manufacturing Robotics Brain-computer interfaces Hypersonics Advanced Materials Advanced surveillance technologies The Implications for your Business

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