Today, the U.S. Department of Commerce published for comment proposed regulations that would create sweeping authority to oversee, and potentially require the removal of, purchases of foreign telecommunications and IT technology linked to “foreign adversaries” by persons in the United States and U.S. companies overseas.  The draft regulations on “Securing the Information and Communications Technology and Services Supply Chain” are open for comment for thirty days.

The Proposed Regulations create a process for national security reviews of purchases of information and communications technology and services within U.S. jurisdiction.  Commerce will be able to initiate a review of any transaction connected to a foreign person occurring after May 15, 2019, including agreements signed prior to that date that are still being performed.

If Commerce concludes, after interagency consultation, that an ICTS transaction with links to a “foreign adversary” poses an “undue risk” to U.S. critical infrastructure or the U.S. digital economy or an “unacceptable risk” to U.S. national security or U.S. persons, it will be empowered take a range of actions to address any concerns, including prohibiting or unwinding the transaction or imposing mitigation measures.  There is no process for pre-clearance or advisory opinions contemplated; U.S. buyers will be subject to after-the-fact remedies at Commerce’s discretion.

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