Commerce asked to work with industry on deemed export reform

Commerce asked to work with industry on deemed export reform A dozen trade groups asked the U.S. Commerce Department to “go back to the drawing board and work closely with industry in developing an approach that will produce a more balanced result” for the country’s licensing regulations governing foreign nationals’ access to certain U.S.-made technologies and know-how, specially those with both commercial and military applications, known as “dual use” items.
   In a letter to Commerce Secretary Carlos Gutierrez Friday, the groups, which include the National Foreign Trade Council, Coalition for Employment Through Exports, Information Technology Industry Council, and U.S.-China Business Council, raised concerns about the practicality of recent recommendations made in the Deemed Export Advisory Committee (DEAC) report.
   The groups agreed with the DEAC’s conclusions about the difficulty of controlling the global flow of technological knowledge, namely through the use of unilateral U.S. export control regulations. The groups also endorsed the DEAC’s call for limiting the scope of deemed exports. However, they criticized the committee’s report for its lack of guidance to address either of these issues.
   “While the DEAC identified several specific technologies as examples for continued controls, it did not make comprehensive recommendations for narrowing the list of dual-use technologies, or for criteria for revising the control list,” the groups' letter said. “Without such guidance, the interagency process is unlikely to make any significant reduction in the scope of technologies covered.”
   The groups also voiced their concerns that more foreign nationals would be subject to deemed export controls and “loyalty tests” through the DEAC’s recommendations.
   “The DEAC’s suggested criteria for clearing foreign nationals would amount to processing Top Secret security clearances for thousands of foreign nationals, a procedure that takes months for U.S. citizens and that has been backlogged for several years,” the groups said in their letter.
   “If the current scope of controlled technologies were maintained and the number of foreign national subject to licensing were expanded, the annual volume of deemed export license applications would immediately rise from the current 900-1,000 to many thousands, far surpassing the government’s resources to process them,” they added.
   The groups further warned that without a more sensible approach to the deemed export policy, the United States risked a mass migration of technology and development talent to other countries.