US export controls have a long history, dating to the American Revolution when the Continental Congress blocked trade with England. Since then, trade controls have been used to advance political, military, and economic objectives. Following the devastation of the 20th Century World Wars, restrictions were imposed on weapons to deter profiteering and the proliferation of nuclear arms, chemical/bio-hazardous materials, and “dual-use” technologies with civil and military applications.
As technologies have evolved, export controls have become an increasingly important toolset to prevent adversaries from accessing items that could be weaponized against the US. In recent years, the US has entered into multilateral arrangements with like-minded nations to improve the effectiveness of strategic trade controls and reduce the abilities and incentives for bad actors to evade rules.
A spokesperson for Sherrod Brown, Chairman of the Senate Committee on Banking, Housing and Urban Development, observed, “When used right, export controls are critical tools to protect our technologies from bad actors and strengthen our national security.” The office for the Committee’s Ranking Member Pat Toomey agreed. “Export controls are powerful tools, and the decision to impose unilateral controls must be taken extremely carefully.”
The Senate Committee on Banking, Housing and Urban Affairs has had jurisdiction over the modern US export control system since its formation after World War II. While most people likely associate this committee with monetary policy, its authority extends to the export control regime. Key to its jurisdiction is oversight of Bureau of Industry and Security (BIS) and the International Trade Administration, both housed at the Department of Commerce. The Senate Banking Committee confirms the President’s nominees to these two agencies, while the Senate Commerce Committee confirms the cabinet-level position of Secretary of Commerce.
Once a relatively obscure agency, the BIS has grown in prominence. It captured headlines in recent years for designating some 350 Chinese companies to the Entity List for activities that run counter to US national security and foreign policy interests—including telecom equipment giant Huawei. A US company must obtain a license from the BIS to do business with a counterpart on the Entity List.
Export controls are an area of strong bipartisan agreement. Major export control reform was enacted as a part of the 2019 National Defense Authorization Act, which was decisively passed in the House (359-54) and Senate (87-10) and signed by the President. Chairman Brown and Ranking Member Toomey authored an amendment to the US Innovation and Competition Act that provides for a review of controls on items that could be used China to abuse human rights, which passed the Senate this year with more than a two-thirds majority.
In the Senate Banking hearing on export controls in 2019 Senator Brown stated:
“We want to protect U.S. national security priorities through tough, appropriate export controls. Ultimately, important national security and law enforcement considerations should be paramount, but kept separate from trade and economic considerations… Although export control decisions can appear to be simple, each one requires complex policy and legal analyses – ones that involve statutes, regulations, international commitments, intelligence and law enforcement equities, industrial base implications, license administration, foreign availability, and multilateral and bilateral foreign policy issues… It’s hard to have a conversation about export controls and emerging technologies without addressing the role China plays in these areas. China is laser-focused on dominating the technology and manufacturing sectors in the decades to come. That ought to have us worried – especially when we remember China’s history of using the same technologies it develops for economic purposes to also help modernize its military.”
There are many stakeholders to America’s export control regime, including exporters, security experts, arms-control advocates, ally nations, and others. Some have criticized the regime as too rigorous; others as not rigorous enough, obsolete, inefficient, and overly complex. The Export Control and Reform Act (ECRA) of 2018 sough to address these concerns, reflecting the “delicate balance between the maintenance of economic competitiveness and the preservation of national security,” noted a 2021 Congressional Research Service report. Indeed the ECRA is considered historic for its scope and attempt to update the regime after decades. Notably it provides greater statutory authority to BIS, and it strengthens standards for emerging and foundational technologies.
It has been four years since the Senate Banking Committee last confirmed a BIS Under Secretary. Though the last few BIS leaders served in acting roles, they have been productive, moving as quickly as one major regulatory action per week. Now attention has shifted to Alan Estevez, who Biden nominated to head the agency in July. A veteran of the Pentagon, Mr. Estevez brings a background in national security strategy—which may signal the Biden Administration’s intent to continue to build on the prior administration’s security policy vis-à-vis the US and China.
“The Under Secretary [for the Bureau of Industry and Security] plays a critical role in protecting our economic and national security,” Senator Brown’s office said. “Senator Brown looks forward to hearing more about Mr. Estevez’s vision and priorities for this key national security position and expects the Committee to move quickly on his nomination.”
*This piece was originally published in Forbes