MAR. 20, 2008 - MARKEY: Questions Remain on Fast-Tracking Sensitive Tech Exports to China

New Commerce Department Rule May Weaken U.S. Export Controls, Benefit China’s Military

WASHINGTON, D.C. – Representative Edward J. Markey (D-MA), chairman of the Subcommittee on Telecommunications and the Internet and a senior member of the Homeland Security Committee, today reiterated his request for information from the Department of Commerce about a new rule which could fast-track exports of sensitive U.S. technology to companies affiliated with the Chinese government.

Last year, the Department of Commerce designated five Chinese corporations as "Validated End-Users," (VEU) a new designation authorizing them to import certain sensitive U.S. technologies without an export control license. Export control licenses are used to prevent diversion of such sensitive technologies to military users.

On Jan. 29, 2008, Rep. Markey raised questions about this fast-track system based on a report by the non-governmental Wisconsin Project on Nuclear Arms Control, which found that two of the five Chinese corporations designated as VEUs have significant ties to China's military-industrial complex. The Department of Commerce responded on Feb. 15, 2008 but declined to answer a number of questions, citing the confidentiality provisions of the Export Administration Act (EAA) of 1979.  However, provisions in the EAA make clear that the confidentiality provisions cited by the Commerce Department may not be used to withhold information from Congress.  (Rep. Markey's original letter and Dept. of Commerce response available HERE.)

Accordingly, Rep. Markey's second letter to the Commerce Department, released today, reiterates his request for this information and seeks more details about VEU screening and compliance mechanisms. (full letter is available HERE.)

"This new Validated End-User policy raises serious questions about who is getting access to sensitive U.S. technologies without a license. The Department of Commerce should respond in full to my original request for information about the VEU program. Further, while these concerns are outstanding, the Department should not award VEU status to any new companies or additional countries,  " said Rep. Markey.

"Export controls are in place for a reason. We must not give China's military an open pipeline to advanced U.S. technologies that have rightly been restricted. I look forward to receiving a full accounting of this program."

March 20, 2008

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