Articles Posted in China

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On June 8, 2023, the United States and the United Kingdom announced the Atlantic Declaration for a Twenty-First Century U.S.-UK Economic Partnership (“Declaration”). The Declaration reaffirms the need to adapt and reimagine the unique alliance between the two countries. From critical and emerging technologies to digital transformation, clean energy, and defense collaboration, businesses can leverage the partnership to exploit new trans-Atlantic opportunities.

(This is the first post of a three-part series on U.S., UK and EU alignment on economic security strategy.)

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On March 21, 2023, the U.S. Department of Commerce released a Notice of Proposed Rulemaking (NPRM) imposing guardrails preventing the “improper use of funds” made available under the CHIPS Act of 2022. In “Commerce Releases New Proposed Rule Governing Restrictions on Chinese Investments by CHIPS Act Applicants,” members of our International Trade team break down the proposed rule, which tightens restrictions on activities by “affiliates” and clarifies scope of statutory clawbacks.

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The Cyberspace Administration of China (CAC) issued the final version of the Measures on the Standard Contract for the Cross-Border Transfer of Personal Information (Standard Contract Measures) on February 24, 2023, which includes a template standard contract (Standard Contract). The Measures will take effect on June 1, 2023, but set forth a six-month grace period until December 1, 2023, to provide companies with time to take actions for compliance.

In their recent client alert, “China Publishes Measures on Standard Contract for Cross-Border Transfer of Personal Information,” colleagues Jenny (Jia) Sheng, Chunbin Xu and Wenjun Cai break down the details of this final version, including a discussion of when Standard Contract Measures apply, the Personal Information Protection Impact Assessment (PIPIA) and notable compliance obligations.

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On November 2, 2022, Assistant Secretary of the U.S. Department of Commerce Thea Rozman Kendler answered questions on the Bureau of Industry and Security’s (BIS) October 13 interim final rule (“the Rule”) regarding restrictions on certain advanced computing integrated circuits and semiconducting manufacturing items exported to the People’s Republic of China (PRC).  Pillsbury has described the Rule here. Comments on the Rule will be accepted until January 31, 2023. (Previously, comments were accepted until December 12, 2022. This date was extended on December 7, 2022.)

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On October 28, 2022, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) issued guidance on its October 7, 2022 interim final rule (Rule) that imposed new export controls on certain advanced computing integrated circuits (ICs), computer commodities that contain such ICs, and semiconductor manufacturing items exported to the People’s Republic of China (PRC). Comments on the Rule will be accepted until December 12, 2022. Our previous blog post on the Rule may be found here.

The guidance offers several important clarifications, including regarding the definition of a covered “facility,” the impact of the Rule on deemed exports, and the scope of the “activities of U.S. persons” restrictions. An overview may be found below.

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On October 7, 2022, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) issued an interim final rule (the “Rule”) imposing sweeping new export controls targeting certain advanced computing integrated circuits (ICs), computer commodities that contain such ICs, and certain semiconductor manufacturing items intended for the People’s Republic of China (PRC).

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Key Takeaways:

  • The Uyghur Forced Labor Prevention Act (UFLPA) went into effect on June 21, 2022, and requires the U.S. Customs and Border Protection (CBP) to presume that all goods manufactured wholly or in part in the XUAR, or by the entities identified by the U.S. government on June 17, 2022, are made with forced labor and banned from import to the United States, unless the importer demonstrates otherwise (a “rebuttable presumption”).
  • Guidance and Reports published in the week leading up to June 21 identify key information for companies seeking to comply with the law, maintain U.S. imports, and understand the supply chain information that may be required by U.S. Customs and Border Protection (CBP).
  • Where the presumption of forced labor applies, rebutting it will require an importer to overcome a high bar by providing “clear and convincing” evidence; however, this same high standard will not necessarily apply to demonstrating that imports have no connection with the XUAR.

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On June 12, 2022, a bipartisan group of Senate and House lawmakers announced agreement on a new draft of the National Critical Capabilities Defense Act of 2022 (NCCDA), which would establish an expansive outbound review mechanism for investments and other transactions in specified countries of concern, including China. The draft is based on a bill introduced in the Senate last year that ultimately was not included in the U.S. Innovation and Competition Act (USICA), which passed, while the House included a similar measure in its America COMPETES Act, which also passed, and the two bills are now in conference.

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On January 24, 2022, the U.S. Department of Homeland Security (DHS) on behalf of the Forced Labor Enforcement Task Force (FLETF) issued a Notice Seeking Public Comments on Methods to Prevent the Importation of Goods Mined, Produced, or Manufactured with Forced Labor in the People’s Republic of China, especially in the Xinjiang Uyghur Autonomous Region, into the United States (RFC). The notice is available here. Comments are due by March 10, 2022.

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TAKEAWAYS

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