The Treasury Department last week issued an order barring certain funds transfers involving a Hong Kong-registered cryptocurrency exchange due to its ties to illicit Russian financing. The order, which is the first issued under new authority granted to the Financial Crimes Enforcement Network under the Combating Russian Money Laundering Act, prohibits “certain transmittals of funds” involving Bitzlato by a range of financial institutions.
Although the Biden administration appears to be leaning toward a narrower outbound investment screening mechanism than previously expected, that doesn’t mean the tool will remain narrow indefinitely, former U.S. national security officials cautioned this week. They also said they expect implementation to be challenging, particularly as the government tries to define specific technologies outbound reviews should capture.
DOJ this week released its revised criminal corporate enforcement policies for voluntary self-disclosures, outlining new criteria companies must meet to qualify for declinations even in cases where there are aggravating factors. The new updates, which are the “first significant changes” to the Criminal Division’s corporate enforcement policies (CEP) since 2017, offer companies “new, significant, and concrete incentives to self-disclose misconduct,” Assistant Attorney General Kenneth Polite said, speaking at Georgetown Law Center. He also said they give companies incentives to “go far above and beyond the bare minimum when they cooperate with our investigations.”
The top Republican on the House Foreign Affairs Committee said the Commerce Department hasn’t yet provided “acceptable responses” to oversight questions about the agency’s technology export controls. In a letter sent last week to Commerce, Rep. Michael McCaul, R-Texas, said the House committee may “use the authorities available to it to enforce these requests as necessary, including through compulsory process.”
U.S. and Japanese officials this week said they are hopeful the two countries will soon align their semiconductor export controls against China, adding to optimism within the Commerce Department that U.S. allies will eventually agree on the chip restrictions. The U.S. and Japan have made “progress” during recent talks, Japanese Ambassador Koji Tomita said, adding that they could reach more concrete results shortly.
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The Energy Department issued a final rule this month that will allow it to impose monetary penalties for illegal exports of certain nuclear items, including technology. The rule implements a provision in the FY 2019 National Defense Authorization Act that clarified DOE’s ability to impose penalties for violations of Part 810 of the Atomic Energy Act, the agency said, which places controls on exports of “unclassified nuclear technology and assistance.” The agency also issued a set of frequently asked questions to provide guidance on the change.
The Bureau of Industry and Security this week updated its October chip controls on China to also extend the restrictions to Macau. BIS said Macau -- as a special administrative region of China -- presents a “risk of diversion” of export controlled items and should be subject to the same license requirements introduced by BIS’ October rule, which was intended to restrict China’s ability to acquire advanced computing chips and manufacture advanced semiconductors (see 2210070049).
The U.K. last week declined requests from Parliament to disclose more information about export control violations, saying it doesn’t believe the transparency will aid compliance or boost voluntary disclosures. The U.K. also said it’s bound by certain “confidentiality” requirements, including rules that limit the Department for International Trade’s Export Control Joint Unit (ECJU) from releasing names of companies that have violated export restrictions.
The Bureau of Industry and Security finalized new export controls on four dual-use marine toxins after the restrictions were agreed to at the multilateral Australia Group (AG). BIS also announced other export control changes made by the AG, including revisions to clarify controls on certain “genetic elements and genetically modified organisms” and the “scope of the exclusion that applies” to certain medical isolators. The agency also updated the “nomenclature” of certain bacteria and fungi, and clarified the definition of “disinfected” as it applies to certain biological equipment. The changes take effect Jan. 17.