The Biden administration said Friday (March 26) that it wants new public input on implementing rules on licensing or other procedures to help U.S. companies comply with a sweeping new regulation targeting Chinese technology companies.
On Monday (March 22), the U.S. Commerce Department approved a rule issued by former President Donald Trump in January to take effect over the objections of business groups, Reuters reported.
Days before Trump left office in January, the Commerce Department issued an interim final rule designed to address concerns about the supply chain (ICTS) of products in the information and communications technology sector brought by Communist China, Russia, Iran, North Korea, Cuba and Venezuela.
The rule indicates that the Commerce Department will adopt licensing or other pre-clearance procedures by May 19.
In response, the U.S. Department of Commerce said Friday that “additional public attention is clearly needed,” adding that it “is seeking concerns about several aspects of the potential voluntary licensing or pre-clearance process.”
The provision stems from a 2019 executive order from Trump. The order states that foreign adversaries are “creating and exploiting vulnerabilities in information and communications technologies and services …… to commit malicious cyber acts, including economic and economic espionage.”
Judith Lee, an attorney from Washington who specializes in international trade matters, said, “[Seeking public comment] gives me some comfort that they’re going to take their Time and do this in a very thoughtful, as well as methodical, way.” “The regulation is designed to be extremely broad in scope and to give any type of Internet or communications technology company a lot of pause.”
The U.S. Chamber of Commerce and other business groups said the rule gives the U.S. government “virtually unlimited authority to interfere with virtually any business transaction involving technology between U.S. companies and foreign companies, and with virtually no statutory process.”
In a letter Monday, the U.S. Chamber of Commerce urged the Biden Administration to suspend the rule, calling it “deeply problematic. And it added that it would impose “enormous costs.”
The U.S. Chamber of Commerce said licensing is a good idea, but “the enormous number of transactions each year …… will limit the ability of this process to review all transactions in a timely manner.”
Last week, the Commerce Department revealed that it had issued subpoenas to several Chinese companies providing information and communication technologies (ICTS) services in the United States to find out if they pose a national security risk to the United States.
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