Report: U.S. export control reform needs ‘serious review’

Washington, D.C.-based think tank Institute for Science and International Security warns some export control reform actions could make it easier for pariah nations or terrorist groups to obtain sensitive U.S. technologies for weapons.    The U.S. export control reform initiative is in need of a “serious review.”
   That’s the conclusion of a report released by the Institute for Science and International Security, a Washington think tank that focuses on preventing the spread of nuclear weapons technologies to pariah nations and terrorist organizations. The Obama administration announced the Export Control Reform Initiative on April 20, 2010.
   The initiative called for the formation of a single export control list to make clearer to U.S. companies which items require licenses for export and which do not.
   It also sought a single licensing agency that would have jurisdiction over munitions, dual-use items, and technologies—one that would streamline the review process and ensure that export decisions are consistent and made bade on the real capabilities of the technology.
   Lastly, the reform initiative called for the use of a single technology system to manage the process.
   While this multiyear initiative outlasted the Obama administration, the agencies involved – namely the Commerce, State and Defense departments – made great progress between 2013 and 2016 transitioning items off the State Department’s more rigorous U.S. Munitions List to the Commerce Control List, which oversees “dual-use” goods, i.e. those with both commercial and military applications.
   “These goals are not problematic if the items truly are innocuous and the changes addressed legitimate concerns of the government, allies, and exporters. However, the effort may have simply contributed to increasing the world’s supply of sensitive goods usable in military programs – and thereby increasing availability of such goods to adversaries,” the institute’s Andrea Strickler and David Albright wrote in their 61-page report, “U.S. Export Control Reform: Impacts and Implications for Controlling the Export of Proliferation-Sensitive Goods and Technologies.”
   The institute is concerned that the “freer availability” of items that shifted to the Commerce Control List may still find their way into military equipment of so-called “proliferant states,” such as Iran, Syria, Pakistan and North Korea. It also asked questions about whether the export reforms should be revisited and sufficient follow-up on licensed exports is being carried out by the agencies.
   “The Obama administration did not have to answer these questions through any substantive reporting or testimony during a review. It is now time for Congress to become involved to ensure that this review and reporting is performed by the executive branch,” the report said.
   “The risks of not performing such a review may be that only a major scandal associated with the spread of deregulated goods would necessitate a review ipso post facto, which is not a preferable way to conduct policy,” it added.
   The institute, however, credited the agencies for setting up the Export Enforcement Coordination Center and the formation of the Consolidated Screening List (CSL) of controlled entities and individuals in 2010, so that exporters and the government no longer needed to consult up to six individual lists of denied parties.
   In addition, the institute’s report made a number of recommendations it believes will further enhance the Export Control Reform Initiative as it continues to move forward under the Trump administration.
    According to the report, the president should include a special advisor within the National Security Council whose sole focus is on export control coordination, implementation, and enforcement matters. Information to keep the National Security Council up to date will be provided by Bureau of Industry and Security and the Homeland Security Investigations.
   The institute said the Trump administration should request that BIS examine the end uses of STA (Strategic Trade Authorization) exception goods processed since 2011 to ensure that the exception is not being abused by notable transit countries.
   “A BIS priority should be to continually conduct checks on goods exported since the exception’s creation to ensure that they have not been re-transferred,” the institute said.
   It also urged Congress to direct the Government Accountability Office (GAO) to develop a detailed report on the impacts of the Export Control Reform Initiative related to control of proliferation-sensitive goods and improvement or degradation in government functions.
    The institute Congress should use these reports to “assess whether new action, including legislation, is required to repair flaws in the system and ensure proliferation-sensitive goods are adequately controlled.” Similarly, the Trump administration should consider this information to “repair weaknesses in the system,” or add control criteria.
   Finally, the institute encouraged federal lawmakers to consider pursuit of an Export Control Reform Act as originally proposed by an ECR Initiative Presidential Task Force. 
   “The legislation would create a single export control list, a single export licensing agency, and a consolidated primary export enforcement agency,” in other words a merger of BIS’s Office of Export Enforcement (OEE) and Department of Homeland Security’s Homeland Security Investigations (HSI), the institute explained.
   “Absent that action, Congress should update and pass a new EAA (Export Administration Act) and eliminate the annual renewal requirement under the IEEPA (International Emergency Economic Powers Act),” it added. “The original’s expiration in 2001, rendering the EAR (Export Administration Regulations) subject to IEEPA and U.S. presidents renewing annually the state of emergency regarding export regulation under that statute, is not an ideal mechanism for export enforcement.”