Senate lawmakers are urging the Biden administration to significantly boost funding for the Bureau of Industry and Security (BIS) to strengthen its export control administration and enforcement capabilities, in response to the agency's expanding responsibilities.
In a Feb. 6 letter addressed to President Biden, the chairman and some members of the Senate Banking, Housing, and Urban Affairs Committee expressed how crucial it is to increase funding for the bureau as threats continue to emerge that could jeopardize U.S. technology protection and national security.
“BIS is a critical component of our national security policy, using export controls to achieve strategic national security and foreign policy objectives,” the lawmakers said in the letter.
They highlighted how export control has been used against Russia in response to its invasion of Ukraine as well as restrictions imposed on China, especially in the tech and military sectors.
In January, BIS announced that it was expanding and strengthening existing export control restrictions imposed against Russia, Belarus, and Iran. As part of the expansion, BIS added 94 Harmonized Tariff Schedule (HTS) 6-digit codes to the list of items that require a license for export, reexport, or transfer to Russia or Belarus. Some of these items include certain chemicals, lubricants, and metals.
In partnership with other federal agencies, the bureau also recently issued guidance to the maritime and other transportation industries about the common tactics used by malicious actors to facilitate the illicit transfer of cargo. The guidance also advised companies in this sector to implement and strengthen their compliance programs to minimize the risk of violating sanctions and export control restrictions.
Despite these growing responsibilities, the bureau’s budget has been stagnant for several years, as highlighted by Commerce Secretary Gina Raimondo who also recently called for greater funding.
During an event hosted by the Reagan National Defense Forum in December, Raimondo said that “BIS has the same budget today [$200 million] as it did a decade ago [even though there’s] twice as many licensing requests.”
She added that greater funding would help address some of the national security risks posed by China’s technological capacity, especially in the semiconductor and supercomputing industries.
“Technology is more important than ever to our national security and the Commerce Department sits in the center of the administration's technology and innovation policy,” Raimondo said.
The calls for greater funding come as a top official at the Department of Commerce warned companies in January that they may see higher penalties for violating export controls, especially restrictions tied to China and Russia, the Wall Street Journal reported.
Highlighting the seriousness of compliance, Matthew Axelrod, Assistant Secretary for Export Enforcement at the Commerce Department, recently warned that fines for export control violations could escalate, potentially reaching levels similar to those of foreign bribery offenses, which in some cases have amounted to billions of dollars.
“You’re going to start to see more high-dollar resolutions,” Axelrod said. “We’re on the cusp of seeing the results of the enforcement efforts that track that evolution of the national security threat.”
In a Feb. 6 letter addressed to President Biden, the chairman and some members of the Senate Banking, Housing, and Urban Affairs Committee expressed how crucial it is to increase funding for the bureau as threats continue to emerge that could jeopardize U.S. technology protection and national security.
“BIS is a critical component of our national security policy, using export controls to achieve strategic national security and foreign policy objectives,” the lawmakers said in the letter.
They highlighted how export control has been used against Russia in response to its invasion of Ukraine as well as restrictions imposed on China, especially in the tech and military sectors.
In January, BIS announced that it was expanding and strengthening existing export control restrictions imposed against Russia, Belarus, and Iran. As part of the expansion, BIS added 94 Harmonized Tariff Schedule (HTS) 6-digit codes to the list of items that require a license for export, reexport, or transfer to Russia or Belarus. Some of these items include certain chemicals, lubricants, and metals.
In partnership with other federal agencies, the bureau also recently issued guidance to the maritime and other transportation industries about the common tactics used by malicious actors to facilitate the illicit transfer of cargo. The guidance also advised companies in this sector to implement and strengthen their compliance programs to minimize the risk of violating sanctions and export control restrictions.
Despite these growing responsibilities, the bureau’s budget has been stagnant for several years, as highlighted by Commerce Secretary Gina Raimondo who also recently called for greater funding.
During an event hosted by the Reagan National Defense Forum in December, Raimondo said that “BIS has the same budget today [$200 million] as it did a decade ago [even though there’s] twice as many licensing requests.”
She added that greater funding would help address some of the national security risks posed by China’s technological capacity, especially in the semiconductor and supercomputing industries.
“Technology is more important than ever to our national security and the Commerce Department sits in the center of the administration's technology and innovation policy,” Raimondo said.
The calls for greater funding come as a top official at the Department of Commerce warned companies in January that they may see higher penalties for violating export controls, especially restrictions tied to China and Russia, the Wall Street Journal reported.
Highlighting the seriousness of compliance, Matthew Axelrod, Assistant Secretary for Export Enforcement at the Commerce Department, recently warned that fines for export control violations could escalate, potentially reaching levels similar to those of foreign bribery offenses, which in some cases have amounted to billions of dollars.
“You’re going to start to see more high-dollar resolutions,” Axelrod said. “We’re on the cusp of seeing the results of the enforcement efforts that track that evolution of the national security threat.”
