Cover story: AI Regulation

AUKUS: Defense Chiefs Announce Pillar II Initiatives

Royal Australian Navy Collins Class Submarines joined in formation by United States Navy Los Angeles Class Submarine USS Santa Fe in the West Australian Exercise Area for a photo opportunity in February 2019.

Defense Chiefs of the AUKUS military-industrial alliance met at the Defense Innovation Unit Headquarters at Moffett Field in California to discuss progress for the partnership, especially Pillar II, the broad based defense industrial collaboration. The three nations are also establishing an AUKUS Industry Forum with trilateral government and industry representatives to help inform policy, technical and commercial frameworks to facilitate the development and delivery of advanced capabilities. The initial meeting of that forum will occur in the first half of 2024. In a Joint Statement, the Secretaries and Deputy Prime Minister reaffirmed the three nations' commitment to maximize the strategic and technological advantage of AUKUS . They agreed that advancing AUKUS requires continued commitment to streamlining defense trade controls and information-sharing while minimizing policy and financial barriers across public and private sectors.

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November 2023 Export Practitioner

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- More Firearm Export "Pause" Outrage
  
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- OFAC Ups Ante on Belarus
  
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- OFAC / Justice Target Serial Procurer for Russia
  
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- Requests for Nominations: Advisory Committee on Supply Chain Competitiveness
  
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Sanctions

OFAC Sanctions Guatemalan Official

Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Luis Miguel Martinez Morales for his role in corruption in Guatemala wherein he engaged in widespread bribery schemes, including schemes related to government contracts. Martinez is the former head of the now-defunct Centro de Gobiernoa powerful quasi-cabinet level agency created by Guatemalan President Alejandro Giammattei at the start of his administration.

Asset Seizure for Ukraine Reconstruction Act

Legislation authorizing the Justice Department to more quickly seize high-value assets owned by sanctioned Russian oligarchs and transfer the funds to Ukraine is being sponsored by a bipartisan group of lawmakers. The Asset Seizure for Ukraine Reconstruction Act would allow Justice to seize high-value assets owned by sanctioned Russian oligarchs more quickly through existing administrative forfeiture processes and transfer the proceeds from those assets to assistance for Ukraine.

China Sanctions Report: Weak Leverage, No Winners

In the event conflict with China warrents further sanctions, the U.S. may find its leverage weaker than desired, according to a new report from the Center for a New American Security (CNAS). No Winners in This Game: Assessing the U.S. Playbook for Sanctioning China by Emily Kilcrease illuminates the severe constraints on U.S. sanctioning capabilities, particularly if the United States attempts to act unilaterally without key partners. …

Enforcement

FCPA: US to Host Corruption Conference Dec 11

The United States will host the 10th session of the Conference of the States Parties (COSP) to the United Nations Convention against Corruption (UNCAC) in Atlanta from December 11-15, 2023.

FCPA: International Corporate Anti-Bribery Initiative Announced

n a speect to the 40th International Conference on the Foreign Corrupt Practices Act, the Justice Department's FCPA Chief announced an anti-bribery initiative to drive cross-border collaboration in fighting foreign bribery. Acting Assistant Attorney General Nicole Argentieri's comments included the announcement of the International Corporate Anti-Bribery initiative, or ICAB, which will be driven by three experienced prosecutors, who will build on existing bilateral and multilateral partnerships, as well as form new partnerships.

PwC China Cheating Costs $7 million

The Public Company Accounting Oversight Board sanctioned PwC China and PwC Hong Kong for violating PCAOB quality control standards related to integrity and personnel management. Both firms failed to detect or prevent extensive, improper answer sharing on tests for mandatory internal training courses. The PCAOB also sanctioned the accounting firm Haoxin and four of its associated persons for violations of the U.S. securities laws and PCAOB rules and standards in connection with the audits of the 2015-2017 financial statements of Gridsum Holding Inc.

Policy Briefs

Congress Chides USTR on Digital Trade

Co-Chairs of the Digital Trade Caucus, led a bipartisan letter with 38 members of Congress urging U.S. Trade Representative Katherine Tai to reconsider her agency’s decision to abandon important bipartisan digital trade proposals at the World Trade Organization. Suzan DelBene (D-WA) and Darin LaHood (R-IL) contend the decision to walk away from key digital trade proposals runs counter to the interests of American workers and businesses, while ceding more leverage to foreign powers, like the People's Republic of China (PRC), to write the rules that will govern the global digital economy for years to come.

Senators Call for Stricter Enforcement Against Forced Labor in Textile Imports

In a concerted effort to combat the import of clothing and textiles made with forced labor, a bipartisan group of U.S. Senators have urged U.S. Customs and Border Protection (CBP) to intensify oversight and enforcement measures. The Senators addressed their concerns to Acting CBP Commissioner Troy Miller, highlighting the necessity of enforcing the Dominican Republic-Central American Free Trade Agreement (CAFTA-DR) and the United States-Mexico-Canada Agreement (USMCA).

Monniker Makeover for Arms Control Bureau

The Department of State last week officially announced the Bureau of Arms Control, Deterrence, and Stability (ADS), the new name of the Bureau of Arms Control, Verification and Compliance. This …

Licensing

DDTC: Temporary USML Mod for Korea Fighter

The Department of State temporarily modifies the United States Munitions List (USML) Category VIII to accommodate the Korean production of their KF-21 Stealth Fighter. The Department assessed that this temporary modification does not change the export jurisdiction or classification of any existing commodities, as it only prevents the possibility of future release from paragraph (h)(1) due to use in the KF–21, which has not yet entered into production. Therefore, when the KF–21 enters production, any paragraph (h)(1) commodities authorized for export for this purpose will retain their current export classification described in paragraph (h)(1).

Firearms Export "Pause" Outrage Continues

House Committee on Oversight and Accountability Chairman James Comer (R-Ky.) joined the chorus requesting information related to the U.S. Department of Commerce’s recent decision to cease issuing new export licenses related to certain firearms, firearm components, and ammunition for approximately 90 days to certain countries.

EU Primer on Dual-Use and Cyber Surveillance Released

This briefing paper on dual-use and cyber-surveillance provides on overview of current EU export controls of dual-use items in general and cyber-surveillance items in particular, and what the approach is in countries such as the US, the UK and Japan. It explains the impact of the sanctions against Russia on the export of dual-use items and the use of cyber-surveillance in the conflict in the Ukraine.