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U.S. Export-Control System Criticized
by Winter Casey
The United States should establish clear guidelines to follow when it weighs what technologies it will allow to be transferred to particular countries, according to a report released Tuesday by the Hudson Institute.
A credentialing process should "be established that would effectively 'register' countries or companies to engage in trade and then subject them to periodic review, just as individuals or companies who trade equities on the U.S. stock exchange register and then undergo monitoring on a real-time basis," the report argued.
"Export requests should be evaluated by means of a matrix approach that considers both the technology itself and the nationality of the applicant," the report said. "Such a system, which would identify and rank the sensitivity of technologies and the friendliness of countries, and which could also assess where that technology is most likely to end up, would clarify the issues involved and facilitate decision-making."
The report noted that a ranking system would assist Congress when it looks to "regulate trade with certain suspect countries without unduly regulating trade with our allies."
The research, which highlights 26 past recommendations aimed at creating a more efficient export-control system, is critical of Congress.
Neither the Bush administration nor Congress seems to view the export-control system "as especially important," according to the report. Congress has acted as an obstacle to an overhaul of the technology-transfer process and refused to permit significant changes to a technology-transfer regime, the report said.
"Why Congress has resisted reform is perhaps more a matter of speculation, but one reason may be simply that it wants to preserve its influence in foreign affairs," according to the report.
During a luncheon at the institute to release the report, Lincoln Bloomfield, a senior adviser to the law firm Akin Gump Strauss Hauer Feld, said more congressional oversight of the export-control system is needed and the legislative branch needs to be as accountable in terms of its knowledge and actions as other government agencies.
Under the current system, a company may need to obtain a license depending on the item that is being exported, where it is going, who will use it and what they will use it for.
Among the commercial products that require licenses are "dual use" items with both military and commercial value, including software, high-powered computers and other types of technology. The Commerce Department's Bureau of Industry and Security regulates the export of dual-use items, while other agencies regulate "more specialized exports," the agency's Web site says.
The report also offers suggestions on how to revamp export-control leadership within the government. Congress and the Bush administration could agree to give a senior official oversight of defense trade and management of the export-control system, either by overseeing a new independent or semi-independent agency with licensing authority, the document suggests.
Jeffrey Bialos, a partner at the law firm Sutherland Asbill & Brennan, said he is skeptical of creating a new agency for export controls.
According to the report, more emphasis needs to be placed on the benefits of allies sharing technology, and product export requirements should be standardized whenever possible.
The government also should collect more data on the export-control system and should draft a narrow list of critical military technologies, the report said, adding that the government should update its export-control system, rely less on lists and focus more on "managing" risk.
The report also called controls on exports of unclassified information "unnecessary" and said the government needs to pay attention to changes in the nature of technology transfer in the last decade "as the source of military capabilities shifts from technology developed in the defense sector to that developed in the civil sector."
Bialos said there is an institutional resistance to the sharing of technology.
Maria Farkas, a research fellow at the Hudson Institute and editor of the report, said the U.S. export-control system could be more effective if it did a better job integrating electronic filing systems. "The next challenge is to synchronize the different electronic filing systems that the departments and agencies use to review export-license applications," the report said.
Europe Wants Workers With Electronics Skills
The European Commission is concerned that it will likely face a shortage of workers with electronic skills in the future, the commission said Tuesday. The commission, the regulatory arm of the European Union, said it considers the skills vital to improving innovation and remaining competitive.
The commission outlined six areas of action: raising awareness of the problem; developing supporting actions and tools; fostering employment in electronics; promoting greater use of electronic learning; promoting cooperation; and monitoring progress.
The commission said it plans to encourage the exchange of information and best practices among EU nations on ways to promote science, mathematics and technology. The commission also said it will hold a major conference in 2008 to report on the region's progress toward increasing the levels of "e-skills."
China To Establish Fund For IP Disputes
The Chinese government will establish a litigation contingency fund to help companies deal with intellectual property disputes, the country's IP office said Tuesday. China Daily reports that China has faced an increase in IP disputes since it joined the World Trade Organization in 2001.
IP investigations, such as those the United States has launched against China, have jeopardized China's high-tech industries and structural upgrades in the country's trade exports, said Yu Benlin, China's deputy chief of the Commerce Ministry's fair trade bureau.
"We cannot rule out the fact that some transnational corporations abuse their [IP] rights and attempt to snuff out the emergence of Chinese firms," said Zhang Qin, deputy chief of China's intellectual property office.
Also this week in China, a report released Tuesday said the country has blocked access to 18,401 Web sites that have been deemed illegal as part of a nationwide campaign against online pornography, which began in April. Shanghai Daily said the sites were closed due to connections with pornography and illicit pictures. The campaign required major Chinese portals to conduct self-examinations of content and block "problematic channels."
Meanwhile, China wants more international collaboration on information-sharing and risk analysis to keep the 2008 Beijing Olympic Games safe from potential terrorists, a Chinese official said Monday. China Daily reports that more than 500 detailed security plans for the games have been mapped.
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