New Security Bill Targets U.S. Technology Transfers to China

New legislation introduced on January 4 by Senators Mark Warner and Marco Rubio aims to stop the transfer of telecom and other technologies to countries that pose a threat to U.S. national security.

According to a press release by Sens. Warner and Rubio, China and other nations are trying to achieve ”technological and economic superiority over the U.S. through the aggressive use of state-directed or -supported technology transfers.”

Under the new legislation, the White House would establish an Office of Critical Technologies & Security which would be responsible for developing a long-term, government-wide strategy to protect against state-sponsored technology theft and mitigate risks to supply chains that provide technology to U.S. consumers.

“China continues to conduct a coordinated assault on U.S. intellectual property, U.S. businesses, and our government networks and information, with the full backing of the Chinese Communist Party,” said Sen. Rubio.  “The U.S. needs a more coordinated approach to directly counter this critical threat and ensure we better protect U.S. technology.  We must continue to do everything possible to prevent foreign theft of our technology and interference in our networks and critical infrastructure.  By establishing the Office of Critical Technologies and Security, this bill will help protect the United States by streamlining efforts across the government.”

“It is clear that China is determined to use every tool in its arsenal to surpass the United States technologically and dominate us economically…  We need a whole-of-government technology strategy to protect U.S. competitiveness in emerging and dual-use technologies and address the Chinese threat,” Sen. Warren added.

Under the proposed legislature, the Office of Critical Technologies & Security would coordinate with state and federal technology and telecommunications regulators, the private sector, subject matter experts, and key international partners to ensure that every means available is utilized to safeguard American supply chains and emerging, foundational, and dual-use technologies.  The Office would also be responsible for educating key business leaders and the American public about the threats posed to national security by the illicit acquisition and transfer of critical technologies by foreign countries and by America’s reliance on foreign products in the supply chain.  The bill would also impose Denial Orders to ban the export of U.S. parts and components to Chinese telecommunications companies, following violations of U.S. sanctions by Chinese telecoms ZTE and Huawei.

The bill would add to on-going efforts by the Trump Administration to crack down on China’s aggressive tactics to expand its technological capabilities.  Last year, Trump signed a measure to boost scrutiny on Chinese investments in American businesses in an effort to prevent countries from acquiring U.S. technology and know-how.