News

U.S. Plans to Help Universities Protect Security of Research

Doug Lederman, Inside Higher Ed – June 29, 2022

The U.S. Department of Commerce on Tuesday announced a new effort aimed at working with universities to protect potentially sensitive research products from theft by foreign agents.

The so-called Academic Outreach Initiative was announced by the Commerce Department’s assistant secretary for export enforcement, Matthew S. Axelrod, in a speech at the annual meeting of the National Association of College and University Attorneys.

“The challenges of keeping our academic research environments thriving and our controlled information secure from improper foreign acquisition are significant,” Axelrod said in remarks prepared for delivery at the conference. “That’s why I’m announcing today a new Export Enforcement initiative to help academic research institutions protect themselves from these threats.”

By working more closely with universities that conduct research with potential national security implications, the federal government “will empower colleges and universities to prevent unauthorized exports, including releases of controlled technology, and to make informed judgments about their future and ongoing partnerships with foreign universities and companies,” Axelrod said in remarks prepared for delivery at the conference.

Read the full Inside Higher Ed article here.

Enforcement Agencies Should Better Leverage Information to Target Efforts Involving U.S. Universities

United States Government Accountability Office – June 14, 2022

In June 2022, the U.S. Government Accountability Office (GAO) was asked to review agencies' efforts to address risks associated with foreign students and scholars who may seek to evade export control regulations. This report examines the extent to which agencies are assessing universities' risk of unauthorized deemed exports to prioritize outreach.

GAO reviewed related laws and regulations; analyzed agency data; and interviewed agency officials in Washington, D.C., and 15 U.S. field offices. GAO based its selection of these offices on their proximity to research universities, their geographic dispersion, and other agencies' field office locations.

They included eight recommendations to strengthen Commerce's, DHS's, and FBI's ability to prioritize outreach to at-risk universities. All three agencies concurred with the recommendations.

To read the full GAO report, please go here.

Publication of Amended Cuban Assets Control Regulations (CACR) and Related Frequently Asked Questions

Office of Foreign Assets Control – June 8, 2022

The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is amending the Cuban Assets Control Regulations, 31 C.F.R. Part 515 (CACR) to further implement portions of the President’s foreign policy toward Cuba.  The rule will be published in the Federal Register on Thursday June 9, 2022.  OFAC is also publishing a number of new and updated Frequently Asked Questions.

Commerce Adds 71 Entities to Entity List in Latest Response to Russia's Invasion of Ukraine

Bureau of Industry and Security, Department of Commerce – June 2, 2022

The U.S. Commerce Department, through its Bureau of Industry and Security (BIS), is issuing a final rule adding seventy-one entities located in Russia and Belarus to the Entity List in further response to Russia’s invasion of Ukraine. This brings the total number of parties added to the Entity List for support of Russia’s military since February 24 to 322. 

Sixty-six of the entities being added to the Entity List today were determined to be ‘military end users,’ and are receiving a “footnote 3 designation.” The footnote 3 designation means these entities are subject to a license requirement for the export, reexports, exports from abroad, or transfers (in-country) of all items subject to the Export Administration Regulations (EAR), as described under the Russia/Belarus foreign “direct product” (FDP) rule.  BIS will review license applications for these entities under a policy of denial.  No license exceptions are available for exports, reexports, exports from abroad, or transfers (in-country) to these entities. 

The parties were added to the list upon a determination by the interagency End-User Review Committee (ERC), made up of the Departments of Commerce (Chair), Defense, State, Energy, and where appropriate, Treasury, based on specific and articulable facts that the entities have been involved are involved, or pose a significant risk of being or becoming involved in activities contrary to the national security or foreign policy interests of the United States.

The ERC makes all decisions regarding additions to, removals from, or other modifications to the Entity List. The ERC makes all decisions to add an entry to the Entity List by majority vote and makes all decisions to remove or modify an entry by unanimous vote.

The rule takes effect upon posting for public inspection on June 2, 2022, on the website of the Federal Register. Text of today’s rule is available online here. 

These BIS actions were taken under the authority of the Export Control Reform Act of 2018 and its implementing regulations, the EAR.

While no University is listed by name, there are many institutes on the list as well as Russian Academy of Sciences affiliated entities. Best practice to conduct a due diligence screening of all entities in Russia. KU faculty and staff may submit a request for due diligence using our webforms or emailing gos@ku.edu.

Additional information on BIS’s actions in response to Russia’s invasion of Ukraine is available here.

For more information, visit www.bis.doc.gov.

Settlement Agreement between the U.S. Department of the Treasury’s Office of Foreign Assets Control and Toll Holdings Limited

Office of Foreign Assets Control – April 25, 2022

The United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) today [April 25, 2022] announced a settlement with Toll Holdings Limited (“Toll”), an international freight forwarding and logistics company headquartered in Melbourne, Australia. Toll agreed to remit $6,131,855 to settle its potential civil liability for 2,958 apparent violations of the Iranian Transactions and Sanctions Regulations, the North Korea Sanctions Regulations, the Syrian Sanctions Regulations, the Weapons of Mass Destruction Proliferators Sanctions Regulations, and the Global Terrorism Sanctions Regulations. The apparent violations occurred when Toll originated or received payments through the U.S. financial system involving sanctioned jurisdictions and persons. These payments were in connection with sea, air, and rail shipments conducted by Toll, its affiliates, or suppliers to, from, or through the Democratic People’s Republic of Korea, Iran, or Syria, or the property or interests in property of an entity on OFAC’s list of Specially Designated Nationals and Blocked Persons. The settlement amount reflects OFAC’s determination that Toll’s apparent violations were non-egregious and voluntarily self-disclosed.

For more information on this OFAC Enforcement settlement, please visit the following web notice.

This settlement agreement is an example of the long-arm and breadth of U.S. Sanctions Programs.  The Australian firm Toll with no office in the U.S. was fined over $6m for apparent violations that occurred when the foreign company originated or received payments through the U.S. financial system involving sanctioned jurisdictions and persons.  As a reminder, all U.S. persons must comply with OFAC regulations, including all US citizens and permanent resident aliens regardless of where they are located. In the cases of certain programs, foreign persons (Toll as an example) also must comply with OFAC regulations.

Securing Intellectual Property for Innovation and National Security

Sujai Shivakumar, Center for Strategic and International Studies – March 3, 2022

The United States is engaged in a global competition for innovation, with critical implications for the nation’s continued technological leadership, competitiveness, and security. To win, the United States will need to leverage its advantages at home, including its robust intellectual property (IP) rights system and the innovative zeal of its entrepreneurs. It should also look abroad—setting the pace for scientific cooperation with allies and strategic partners, as well as developing shared international technical standards through the contributions of experts from around the globe. Most pressingly, the United States should not adopt policies that weaken protection of U.S.-owned patents—which would both disincentivize innovation in the United States and support Chinese efforts to dominate critical standards and other advanced technologies.

Yet a recent proposal of the Antitrust Division of the U.S. Department of Justice (DOJ) does just that. Launched as a consultation, its Draft Policy Statement on Licensing Negotiations and Remedies for Standards-Essential Patents Subject to F/RAND Commitments is promoted as an effort to encourage good-faith licensing negotiations and to address the scope of remedies available to patent owners who have agreed to license their essential technologies on fair, reasonable, and non-discriminatory (F/RAND) terms.

For the complete Center for Strategic and International Studies article, please visit this webpage.

DARPA Screening for ‘Risk’ in Researchers’ Foreign Affiliations

Mitch Ambrose, American Institute of Physics – February 15, 2022

For over three years, the Department of Defense has been responding to congressional direction aimed at securing the research it funds from potential exploitation by rival governments. While many federal agencies have stepped up their research security efforts, DOD’s moves have generally been more expansive, both because they extend to the protection of R&D geared toward military applications, and because Congress has given the department additional mandates.

Now, the Defense Advanced Research Projects Agency is implementing a “Countering Foreign Influence Program” that involves assessing risks posed by researchers’ affiliations with foreign institutions, even for unclassified projects in fundamental research. While other science agencies have likewise expanded their use of disclosure policies to identify problematic conflicts of interest and time commitment, DARPA’s policy goes further by tying the review process to specific categories of foreign entities of concern.

Although DARPA stresses that projects deemed to carry high risk can still proceed with the appropriate approval, many stakeholders are seeking more clarity on the kinds of affiliations DARPA and other science agencies might deem problematic.

Read the full American Institute of Physics article here.

Technologies for American Innovation and National Security

White House Office of Science and Technology Policy – February 7, 2022

Today [February 7, 2022], the United States is releasing an updated list of critical and emerging technologies (CETs) that can play an important role in our nation’s security. Last updated in 2020, this list represents a subset of novel, advanced technologies with the potential to chart new pathways in American innovation and strengthen our national security.

The 2021 Interim National Security Strategic Guidance defines three national security objectives: (1) protect the security of the American people; (2) expand economic prosperity and opportunity; and (3) realize and defend democratic values. The 2021 CET list identifies the technology areas that currently hold the greatest potential to further those objectives in the future – and, for the first time, it also includes several specific subfields under each technology area.

This list will be a useful resource that guides new and existing efforts to promote U.S. technological leadership, cooperate with allies and partners, advance democratic values, attract and retain diverse science and technology talent from around the world, and protect against threats to U.S. security. For example, on January 21, U.S. Citizenship and Immigration Services, an agency in DHS, put in effect new policy guidance governing National Interest Waivers that utilizes the concept of CETs. The guidance stated that “USCIS recognizes the importance of progress in STEM fields and the essential role of persons with advanced STEM degrees in fostering this progress, especially in focused critical and emerging technologies or other STEM areas important to U.S. competitiveness or national security.” The CET list will be a useful reference as we chart a path for future American innovation and national security.

Read the full White House article here.

Settlement Agreement between the U.S. Department of the Treasury's Office of Foreign Assets Control and An Individual

Office of Foreign Assets Control – December 8, 2021

The U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) today [December 8, 2021] announced a $133,860 settlement with a natural U.S. person ("U.S. Person-1"). U.S. Person-1, who at the time of the apparent violations was a U.S. citizen living in the United States, has agreed to settle their potential civil liability for four apparent violations of the Iranian Transactions and Sanctions Regulations, 31. C.F.R. part 560. Specifically, between approximately February 2016 and March 2016, U.S. Person-1 arranged for, and received, four payments on behalf of an Iranian company using a personal bank account in the United States. OFAC determined that U.S. person-1 did not voluntarily disclose the apparent violations, and that the apparent violations constitute an egregious case.

For more information, please visit the following web notice (pdf).

For more information on this specific action, please visit this page.

Foreign Influence and Its Impact on Research Integrity – A Four-Part Series | Part 4: A Global Concern

Susan Wyatt Sedwick ǀ Society of Research Administrators International – May 12, 2021

Most of what we hear about foreign influence is viewed through the lens of the concerns raised over the past three years by United States (US) federal granting agencies such as the National Institutes of Health (NIH) and National Science Foundation (NSF). It is clear to those involved in educating the research administration community that these concerns are increasingly shared by countries from around the world and are not limited to the concerns first raised by the US. The European Union (EU), Australia, and Japan among others have initiated conversations and calls for stricter policies aimed at curbing this growing threat to international collaborations and research integrity.

For the full Society of Research Administrators International article, please visit this webpage.

Foreign Influences and Its Impact on Research Integrity – A Four-Part Series | Part 3: Recent Developments in Improper Influence on Scientific Research

Susan Wyatt Sedwick, Society of Research Administrators International – March 10, 2021

Research organizations were deluged in December and January with guidance on foreign influence from presidential directives to reports from the General Accounting Office (GAO), Office of Science and Technology Policy (OSTP), and private MITRE Corporation. While each contained unique findings and recommendations, some common themes emerged that provide insights on where the federal agencies may be headed in this complex area of regulatory compliance. The five agencies examined by the GAO (DoD, DoE, NASA, NIH, and NSF) collectively issued almost 90 percent of the federally funded research at universities.

For the full Society of Research Administrators International article, please visit this webpage.

Foreign Influence and its Impact on Research Integrity – A Four-Part Series | Part 2: Federal Agencies’ Policies on Foreign Influences

Debbie Pettitt, Society of Research Administrators International – February 10, 2021

The NIH Grants Policy Statement defines a foreign component as “any significant scientific element or segment of a project outside of the United States” whether or not NIH grant funds are expended, either by “a research or recipient in a foreign location or by a researcher in a foreign location employed or paid by a foreign organization.” NIH requires full transparency for all domestic and foreign research activities and does not consider these clarifications to be policy changes. In August 2018, NIH Director Dr. Francis S. Collins issued a foreign influence letter to 65 American colleges and universities stating NIH is currently investigating more than 180 researchers for unlawful participation in foreign programs, such as China’s Thousand Talents Program, which encourages participants to transfer research and other propriety information from the US to China.

For the full Society of Research Administrators International article, please visit this webpage.

Foreign Influence and its Impact on Research Integrity – A Four-Part Series | Part 1: What is Foreign Influence?

Gloria Greene, Society of Research Administrators International – January 15, 2021

Foreign Influence in accordance with 32CFR147.4 is a concern that a security risk may exist when an individual's family may be subject to duress. Whereas 32CFR147.5 defines Foreign Preference as a concern that an individual may prefer a foreign country over the United States. Federal agencies have expressed concern that foreign entities may be using university research enterprises to compromise our economic competitiveness and national security. Federal law enforcement agencies, federal funding agencies, and the academic and research community are working to effectively identify, educate, and combat the increasing problem and harm foreign influence has on research integrity.

For the full Society of Research Administrators International article, please visit this webpage.

State and Commerce Should Improve Guidance and Outreach to Address University-Specific Compliance Issues

United States Government Accountability Office – May 12, 2020

The U.S. Government Accountability Office (GAO) reviewed related laws, regulations, and guidance, and interviewed officials from relevant federal agencies and four university associations. GAO also visited nine universities—selected, in part, on the basis of research expenditures and geography—and assessed their compliance practices against agency guidelines.

They included four recommendations in their comprehensive report, including that State and Commerce should improve their export control guidance and outreach, which may help address gaps in university export control compliance practices. GAO also recommends that DOD take steps to ensure its officials consistently interpret export control regulations. State, Commerce, and DOD concurred with the recommendations.

To read the full report, please go here.

EAR Rules Expand Requirements for Exports to China, Russia & Venezuela

Bureau of Industry and Security, Department of Commerce – April 28, 2020

This message is to provide notice for all KU and KUMC faculty, staff, and students of a change of U.S. Government regulatory requirements when shipping or hand-carrying items to the People’s Republic of China, Russia and Venezuela. On April 28, 2020, the U.S. Department of Commerce, Bureau of Industry and Security (BIS) published regulations that extend BIS’s oversight of the export, re-export and transfer (in-country) of commodities, software and technology (“items”) to or within the People’s Republic of China, Russia and Venezuela. Effective September 27, 2020, an Electronic Export Information (EEI) is required for all shipments to China, Russia and Venezuela if the item(s) meet the following requirements:

• The item(s) listed on the Commerce Control List (CCL) excluding EAR99 items.
• Value of the shipments is more than $2500 including EAR99 items.

For example:

• shipping or hand-carrying a hard drive to China, Russia, or Venezuela (listed on the CCL as ECCN 5A992) would require an EEI filing.
• shipping or hand-carrying a non-export controlled plasmid to China, Russia, or Venezuela (EAR99 item) would not require an EEI filing (unless the value exceeded $2500).

If required, Express shippers (FedEx, DHL, etc.) can file the EEI on your behalf. For hand-carrying items, contact Global Risk & Security (GRS) for guidance. If there are any questions, please contact GRS at gos@ku.edu.

GRS is also available to answer other questions concerning this change or export compliance in general. We are also available to provide training when requested.