Archive for the ‘Export Control Proposals’ Category


Jul

2

Just What We Need: More Export Controls


Posted by at 6:42 pm on July 2, 2013
Category: Arms ExportCyber WeaponsExport Control Proposals

Hacking in Progress, image by Cristiano Betta (Flickr: Barcamp London 3 @ Google Offices UK) [CC-BY-2.0 (http://creativecommons.org/licenses/by/2.0)], via Wikimedia Commons http://commons.wikimedia.org/wiki/File%3AHacking_in_progress_at_BarCampLondon_3.jpgThe Senate Armed Services Committee has favorably reported S. 1197, the National Defense Authorization Act for Fiscal Year 2014. And, you will be pleased to know (or maybe not), they have slipped into the bill a proposal for new export controls, this time on software that could be characterized as “cyber weapons.”

What got the immensely tech savvy aging Senators all whirled up on cyber weapons was, apparently, testimony they received in hearings on the bill about the Shamoon virus. Shamoon, in addition to being an excellent name for a dog, is also the name of a computer virus that struck Aramco in Saudi Arabia and rewrote or destroyed data on hard drives. No doubt the Senators were particularly vexed that one of the payloads carried by Shamoon was a picture of a burning U.S. flag which was used to overwrite some of the data.

So now section 946 of the proposed Defense Authorization Act requires the President to convene an “interagency process … to control the proliferation of cyber weapons through unilateral and cooperative export controls.” The Senate Report on the proposed legislation acknowledged that there might be some difficulty distinguishing between “cyber weapons” (bad) and “dual-use, lawful intercept, and penetration testing” technologies” (good). But, hey, that’s what an interagency process is for!

Now, the million dollar question, of course, is whether new export controls on cyber weapons would have had any impact on Shamoon. The answer, not surprisingly, is probably not. Kapersky Labs, which dissected the virus, concluded that the virus was riddled with a number of “silly errors” which limited its effectiveness and likely was the work not of sophisticated cyber criminals but was a “quick and dirty” job by “skillful amateurs.” Significantly, it was not something that the hackers acquired in the United States (or anywhere else) and exported but home-grown, error-ridden code. The only people who are going to be bothered by section 946 and its proposed export controls will be legitimate manufacturers of network intercept, analysis and testing software.

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Jan

10

More Tiers Are Shed Over Answered Prayers


Posted by at 7:14 pm on January 10, 2011
Category: BISExport Control Proposals

Kevin Wolf
ABOVE: Kevin Wolf

Today’s edition of the Washington Tariff & Trade Letter has an article (paid subscription required) quoting Kevin Wolf at the Bureau of Industry and Security as to the impact that foreign availability will have on the classification of dual use items in the export reform process.

“To be clear, availability will not be the determining factor in any particular decision,” he said. Rather, “it will be factored in as part of the government’s ultimate decision about how to tier items.”

Even though foreign availability will be one factor in the decision as to what tier the item would classified in, Wolf stressed that the ultimate decision would not overturn existing statutory and multilateral control obligations:

The only caveat to this, again, to the extent not otherwise inconsistent with existing statutory obligations or multilateral obligations, that’s a standing rule in this entire effort. We’re not trying to undo or unwind existing multilateral obligations or statutory obligations

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May

21

House Committee Passes Export Reform Proposal


Posted by at 8:08 pm on May 21, 2009
Category: Arms ExportCriminal PenaltiesExport Control Proposals

Howard Berman
ABOVE: Howard Berman
Chair, House Foreign Affairs


Yesterday, the House Committee on Foreign Affairs approved legislation that would, among other things, amend parts of the Arms Export Control Act (“AECA”). The Bill, H.R. 2410, is titled the ‘‘Foreign Relations Authorization Act, Fiscal Years 2010 and 2011’’ and was sponsored by Rep. Howard Berman, chair of the committee.

Like many of its predecessors, the bill would set processing time goals for licenses and commodity jurisdiction requests, each to be no more than 60 days. And commodity jurisdiction determinations would be required to be posted by the Directorate of Defense Trade Controls (“DDTC”) on its website. The processing times are just “goals” so, even if the legislation passes, I wont be holding my breath waiting for CJ requests to blast out the door in 60 days. But I think we can all give some polite golf claps, and maybe even a louder hooray or two, to the requirement that CJs be posted on the website.

Section 826 of the bill permits the President to remove “satellites and related components” from the United States Munitions List, but it is poorly drafted and has a confusing China exception which reads:

(b) Exception- The authority of subsection (a) may not be exercised with respect to any satellite or related component that may, directly or indirectly, be transferred to, or launched into outer space by, the People’s Republic of China.

Come again? Does this mean that satellites and parts that might be transferred to China stay on the USML and, like all other items, require a license to all destinations? Or does it mean that DDTC can decide that the satellite-related items in Category XV can be exported to every destination but China without a license? And where does the Bureau of Industry and Security (“BIS”) fit into this? Can it require BIS licenses for satellites and parts removed from the USML? Your guess is as good as mine.

A third provision of interest in the proposed legislation might be referred to as the Full Prisons Act. Section 831 increases the maximum criminal penalty from 10 years imprisonment to 20 years imprisonment. For whatever reason, Congress seems unable to enact any reform with increasing prison sentences, even though this appears to be an effort to conform the criminal penalties under the AECA to the increased penalties provide under the International Emergency Economic Powers Enhancement Act (“IEEPEA”) for violations of other export laws. Look for life imprisonment to be a penalty for false AES entries in the not-so-distant future.

Section 831 also attempts to conform civil penalties under the AECA to those enacted under IEEPEA by providing for a penalty equal to the greater of $250,000 per violation or twice the value of the export involved. But Representative Berman’s legislation doesn’t quite manage to get this right either. First, it fails to amend section 38(e), 22 U.S.C. § 2778(e) of the Arms Export Control Act which sets the maximum civil penalty at $500,000. Does this mean that a transaction valued at $1 million, and thus eligible for a $2 million penalty under the amended 38(c), is limited to a penalty of $500,000?

Worse the language of the bill, unlike the language in IEEPEA, makes the penalty payable “upon conviction.” Does that mean that the civil penalty is only available after a criminal conviction? Again, this is probably a drafting oversight, but with all the newly unemployed lawyers in town, can’t the committee hire somebody to clean up its bills?

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Jul

24

Export Controls Proposed To Address Internet Censorship


Posted by at 8:56 pm on July 24, 2008
Category: Export Control Proposals

Shenzen Network PoliceAt a recent event in Washington, D.C., a U.S. legislator and an E.U. legislator announced a joint effort to adopt legislation to address the participation of U.S. and European technology companies in activities of repressive foreign regimes designed to limit access of their citizens to the Internet. The effort targets countries such as China that limit Internet access and which require the providers of Internet services to cooperate in prosecutions of citizens that engage in prohibited Internet conduct.

European Parliament Member Jules Maaten announced that he had drafted the European Online Global Freedom Act for consideration by the European Parliament. The draft legislation would, among other things, prohibit European companies from locating servers or other computer hardware used to provide Internet services in countries that restrict Internet freedom. The law also directed relevant regulatory bodies to promulgate regulations that would prohibit export of items that would be used by foreign countries to restrict Internet freedom and access. It would also prohibit filtering search engine requests at the request of foreign officials of such countries.

On the U.S. side, U.S. Representative Chris Smith (R – N.J.) has introduced the Global Online Freedom Act which roughly parallels the draft European legislation, but is somewhat less restrictive on the activities of U.S. companies. Smith’s legislation, which has been passed out of committee and is on the House’s Union Calendar, requires disclosure of any search engine filtering done at the behest of foreign officials in a country restricting Internet freedom but doesn’t prohibit the company from performing such filtering. It also directs the Department of Commerce to conduct a feasibility study addressing possible export controls on items used to restrict Internet freedom.

Whether or not these proposals will get any traction in their respective legislative bodies, it is safe to say that there is heightened awareness of these issues by legislators and that some export restrictions may ultimately be adopted to counter the worst instances of cooperation by U.S. and European Internet companies with repressive and authoritarian regimes. Of course, whether that will lead to more or less Internet freedom in such countries is an open question — repressive regimes are probably more likely to respond to such sanctions by further limiting access to the Internet rather than by simply eliminating all Internet restrictions.

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