burst!US sanctions Arrow: The latter is included in the MEU list
Reuters reported on the 23rd that the Trump administration in the United States will define 89 Chinese companies as having a “military background” and restrict their purchases of American goods and technologies. Comments said that the list, once released, could further escalate trade tensions between the United States and China and harm the interests of American companies that sell civil aviation parts to China.
In other news, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) intends to issue documents amending the Export Administration Regulations (EAR) to add a new list of “military end users” (MEU) and the first entities. According to Reuters, a draft list seen by it shows that a total of 89 Chinese entities and 29 Russian entities are listed on the MEU list, with Commercial Aircraft Corporation of China, Aviation Industry Corporation of China and 10 related entities on the list. in the list. That means U.S. suppliers must be licensed to sell them a lot of commercial items. Under the rule, applications for such licenses are more likely to be rejected than approved.
It is worth noting that Arrow Electronics Asia Pacific Group (Arrow Asia Pacific), a wholly-owned subsidiary of Arrow Electronics, the world’s largest component distributor, is also on the list.
It is reported that Arrow Asia-Pacific is one of the most important IC distributors in China and even in Asia. The United States focuses on Arrow Asia-Pacific, and further actions may be taken against mainland distributors. Once Arrow Asia-Pacific enters the entity list and is implemented, it also means U.S. suppliers must seek a license to supply components to Arrow Asia Pacific.
Difference Between MEU List and Entity List
The MEU list is different from the entity list that has been heard many times before, and the export control measures implemented under the rule are directed to export activities related to “military end-use” and “military end-users.” The Entity List system, on the other hand, is established based on Section 744.16 to identify subjects who have been determined to engage in or have a significant likelihood of engaging in activities involving violations of U.S. national security or foreign policy interests; therefore, export control measures under the Entity List system are directed to is about an export that violates “U.S. national security” or “U.S. foreign policy interests.”
In terms of control measures, the items on the MEU List Entities that are subject to export control measures are limited to the scope of items listed in Appendix 2 of Part 744. As for the control measures for the subjects listed on the Entity List, the scope of the items restricted by the additional control measures is usually all EAR controlled items, so the Entity List is much more restricted than the MEU List.
In other respects, the MEU list entity inclusion and removal procedures are consistent with the entity list. Applying for license approval is more difficult and more likely to be rejected.
Specifically, the relevant provisions of the MEU list are mainly restricted by Article 772.1 of the Export Control Regulations. According to the document, in addition to complying with the relevant licensing requirements of the U.S. Department of Commerce Control List (CCL), any company exporting, re-exporting, and domestically transferring any item in Annex 2 of Part 744 of the EAR to a company on the MEU list is required to Apply for a license from the U.S. Department of Commerce.
Items listed in Appendix 2 of Part 744 mainly include the following nine categories: materials, chemicals, microorganisms and toxins; material processing; Electronic device involvement, development and production; computers; communications and information security; sensors and lasers; navigation and aviation Electronics; maritime; propulsion systems, spacecraft and related equipment.
New ECCNs in the scope include consumer products such as mobile phones, notebook computers and “smart” devices, as well as certain chips and integrated circuits, certain electronic test and processing equipment, and telecommunications test equipment.
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