As part of the National Defense Authorization Act for 2021 (the “NDAA”), Congress has passed the most significant U.S. anti-money laundering (“AML”) legislation since the USA PATRIOT Act of 2001, the “Anti-Money Laundering Act of 2020” (“AMLA 2020”).
Although President Trump has threatened to veto the NDAA, the majorities supporting the legislation would be sufficient…
Yesterday, President Trump issued an Executive Order[1] that will, following an initial two-month grace period and a further ten-month wind-down period in which only dispositions are permitted, prohibit U.S. persons (including citizens and U.S. legal entities acting outside the United States and foreign citizens and legal entities acting inside the United States)[2] from engaging in any transactions in publicly traded securities (debt or equity) issued by companies that the U.S. government designates as tied to the Chinese military (Designated Entities), as well as in any securities linked (in an undefined manner) to the targeted Chinese securities. The 31 current Designated Entities are listed at the end of this note.[3] …
Continue Reading Trump Administration Bans Transactions in Securities of Military-Linked Chinese Companies: Potentially Far-Ranging Consequences Remain Unclear
Yesterday, the U.S. Department of Commerce, Bureau of Industry and Security (BIS) published a final rule (the Final Rule) imposing export controls on additional emerging technologies pursuant to the Export Control Reform Act of 2018 (ECRA).[1] We previously wrote about the process to identify and impose export controls on emerging and foundational technologies under the ECRA, as well as the steps taken in furtherance of that process to date, here.…
Continue Reading BIS Imposes Export Controls on Additional Emerging Technologies; Further Defines Scope of CFIUS Mandatory Notification Requirement
On September 18, 2020, the U.S. Department of Commerce (Commerce) released for public inspection substantively identical notices[1] specifying the transactions relating to mobile applications TikTok and WeChat to be prohibited pursuant to the executive orders related to both entities issued by President Trump on August 6, 2020 (the TikTok Notice and the WeChat Notice, respectively, and together, the Notices).[2] Commerce withdrew both Notices before formal publication on September 22, presumably to address uncertainty regarding the effective dates in light of developments in both matters; the TikTok Notice has already been re-issued with revised timing, but negotiations over a possible partial sale of TikTok continue.[3] The WeChat Notice has yet to be re-issued, possibly as a result of timing uncertainty regarding the preliminary injunction discussed below.[4] …
Continue Reading Commerce Provides Clarity on the Potential Scope of the TikTok and WeChat Bans; All Else Remains Murky
On August 27, 2020, the U.S. Department of Commerce, Bureau of Industry and Security (BIS) issued an advance notice of proposed rulemaking (the ANPRM) requesting public comment on the definition of, and criteria for identifying, “foundational” technologies[1] that are essential to U.S. national security and should be subject to more stringent export controls.[2] The ANPRM marks another step toward implementing the long-delayed “emerging and foundational technology” provisions of the Export Control Reform Act of 2018 (ECRA).[3] Like the earlier ANPRM regarding emerging technologies, the rulemaking is still at a conceptual stage.…
Continue Reading BIS Issues Long-Awaited Request for Public Comment on Foundational Technologies
Following the enactment of the Hong Kong Autonomy Act (HKAA), the issuance of Executive Order 13936, which implemented sanctions authorities under the HKAA and other statutes, and other recent U.S. sanctions designations and enforcement actions, many multinational entities based or operating in Hong Kong are concerned with how to navigate the new…
Last night, President Trump issued two Executive Orders establishing a framework for prohibiting transactions involving popular Chinese-owned communications apps WeChat and TikTok.[1] Contrary to some press reports, the Executive Orders do not prohibit all transactions with their respective parent companies; they do not in fact set out the scope of the restrictions. Rather, they give the Commerce Department authority to prohibit any transaction involving a U.S. person or within the jurisdiction of the United States involving the two services; each of the Executive Orders clearly states “45 days after the date of this order, the Secretary shall identify the transactions subject to subsection (a) of this section [which contains the broad authority to prohibit].”[2] Furthermore, the scope of Commerce’s authority is subtly (and no doubt intentionally) different in the two Executive Orders: with respect to TikTok, the authority covers any transaction with ByteDance, TikTok’s parent; with respect to WeChat, the authority covers any transaction relating to WeChat involving its parent, Tencent Holding. Commerce will, within 45 days, take further action specifying exactly which transactions will be prohibited; it is even possible, particularly with respect to TikTok if the mooted divestiture of U.S. operations occurs, that no restrictions will be imposed.[3] Unless and until Commerce implements the Executive Orders, no restrictions are in place and their precise future scope is unknown.…
Continue Reading President Trump Authorizes Restrictions on WeChat and TikTok; Details to Come
On July 14, President Trump issued an Executive Order pursuant to the Hong Kong Policy Act eliminating the separate status of Hong Kong and China under various provisions of U.S. law, including export controls, immigration, tax, and extradition, as well as providing for the implementation of recent Hong-Kong related sanctions authorities.
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This Trade Summary provides an overview of WTO dispute settlement decisions and panel activities, and EU decisions and measures on commercial policy, customs policy and external relations, for the first quarter of 2020.
If you have any questions regarding the above, do not hesitate to contact fclaprevote@cgsh.com or tmuelleribold@cgsh.com.
On May 15, 2020, the U.S. Department of Commerce, Bureau of Industry and Security (BIS) issued an interim final rule (the Interim Rule) amending the direct product rule under the Export Administration Regulations (EAR) to further restrict Huawei Technologies Co., Ltd. (Huawei) and its affiliates designated on the Entity List from receiving semiconductor and other products produced outside the United States using U.S.-origin software and technology. The changes, which are effective immediately (but subject to two savings clauses), could have a significant impact on the ability of non-U.S. foundries that manufacture semiconductor products for Huawei and its affiliates (e.g., HiSilicon) using U.S.-origin software or technology to continue to do so (and could have a corresponding significant impact on the competitiveness of U.S. semiconductor manufacturing equipment and software). BIS also extended the temporary general license (TGL) that authorizes certain activities subject to the EAR involving Huawei and its affiliates through August 13, 2020.[1]…
Continue Reading BIS Expands Export Restrictions on Huawei, Extends Temporary General License
