November 13–14, 2024
Hilton Towers Arlington Arlington, VA
ACI's 6th Conference on
CHINA TRADE CONTROLS
The Country’s Premier Gathering on Managing Complex Business Dynamics, Export Controls and Sanctions Risks
DISRUPTIVE TECHNOLOGY TASK FORCE UPDATES:
Kevin Kurland
Deputy Assistant Secretary, Bureau of Industry and Security
U.S. Department of Commerce
OICTS INSIGHTS:
Eun Young Choi
Deputy Assistant Attorney General, National Security Division
U.S. Department of Justice
NEW BEST PRACTICES FROM:
Intel
Honeywell
Thermo Fisher Scientific
Biogen
Pfizer
Microsoft
SAP
Barclays (Hong Kong)
Northrop Grumman
Qualcomm
Keysight Technologies
L3 Harris
WILO Group LLC ɀ Mitsubishi Logisnext Americas
Nidec Motor Corporation
Parsons
IBM
Applied Materials
MicroPort Orthopedics ɀ Sandvik Manufacturing Solutions ɀ ServiceNow
Elizabeth Cannon
Executive Director of the OICTS,
Bureau of Industry and Security
U.S. Department of Commerce
THE BULK DATA EO AND NEXUS WITH CHINA TRADE:
Lee Licata
Deputy Section Chief for National Security Data Risk
U.S. Department of Justice
ASSOCIATE SPONSORS:
OUTBOUND INVESTMENT UPDATES:
Eric S. Johnson
Principal Deputy Chief, Foreign Investment Review Section
U.S. Department of Justice
EXHIBITOR:
As the only comprehensive, practical event of its kind, there has never been a more pressing time to address critical challenges, including:
Distinguished Faculty
GOVERNMENT FACULTY:
ç Post-Election China Trade Policy Outlook: Positioning Your Organization for What’s Ahead
ç Deciding If and How to Continue Business Operations in China: Aligning Decision-Making with Export and Sanctions Risk Management
ç Third-Party Management: Handling the Impact of Evolving Export Controls and Sanctions on Due Diligence and Monitoring
ç Making the Toughest Export Compliance Calls on China: de minimis, FDPR and the Interplay with Economic Sanctions
ç Integrating Export Controls and Sanctions for an Optimal Compliance Program: Revisiting Your Organization’s Risk Profile and Detecting Program Weak Spots
And much more!
Eun Young Choi
Deputy Assistant Attorney General, National Security Division
U.S. Department of Justice
Kevin Kurland
Deputy Assistant Secretary, Bureau of Industry and Security
U.S. Department of Commerce
Elizabeth Cannon
Executive Director of the OICTS, Bureau of Industry and Security
U.S. Department of Commerce
Lee Licata
Deputy Section Chief for National Security Data Risk
U.S. Department of Justice
Eric S. Johnson
Principal Deputy Chief, Foreign Investment Review Section
U.S. Department of Justice
Kit Conklin
Senior Advisor
U.S. House Select Committee on China
Julia Khersonsky
Deputy Assistant Secretary for Strategic Trade
Bureau of Industry and Security
U.S. Department of Commerce
CONFERENCE CO-CHAIRS:
Rebecca Conover
Senior Director, Export Controls and Sanctions
Intel
Barb Secor
Vice President, Global Trade Compliance
Thermo Fisher Scientific
Ajay Kuntamukkala
Office Managing Partner
Hogan Lovells
KEY INSIGHTS AND BEST PRACTICES FROM:
Peter Harrell Attorney
Former Senior Director, International Economics and Competitiveness, The White House; National Security Council; National Economic Council
Jeanette Chu
Vice President, National Security Policy
National Foreign Trade Council; Former Senior Policy Advisor, Bureau of Industry Security (BIS), U.S. Department of Commerce
Elizabeth Fitzpatrick
Vice President and General Counsel, Global Trade Sanctions Honeywell
Irene Chiu
Senior Vice President & Chief Compliance Officer MicroPort Orthopedics
Sahra Park-Su
Lead Senior Legal Counsel, Global Export Controls and Trade Sanctions SAP
Michaael DiPaula-Coyle
Head of International Trade Policy/ Director for Trade, Enterprise Risk and Supply Chain Resiliency IBM
Kelly Herman Corporate Counsel Northrop Grumman
Toochi Ngwangwa
US Global Trade Counsel Sandvik Manufacturing Solutions
Bob Bowen
Export and Trade Compliance Counsel ServiceNow
Hena Schommer
Director, Trade Legal Applied Materials
Sasha Kalb
Director, Financial Crimes Legal Barclays (Hong Kong)
Hector Rivera
Senior Director, Export and Sanctions Compliance Qualcomm Technologies Inc.
Debbie Shaffer
Senior Manager, Global Trade Compliance L3 Harris Technologies
Mark Jones
Export Compliance Manager WILO Group LLC
Sarah O’Hare O’Neal
Deputy General Counsel, International Trade Law Microsoft
Michael Bermudez
Vice President, International Trade Compliance Parsons
Heather Ludwig
Trade Compliance Counsel, Director Nidec Motor Corporation
Bryce Bittner
Managing Counsel, International Trade Legal McKinsey & Company
Ted Murphy
Partner
Sidley Austin LLP
David A. Ring
Partner
Wiggin and Dana LLP
Dr. Chris Timura
Partner
Gibson, Dunn & Crutcher LLP
Jahna Hartwig
Partner
Wilson Sonsini Goodrich & Rosati
Paul Marquardt
Partner
Davis Polk & Wardell LLP
Mollie Sitkowski
Partner
Faegre Drinker Biddle & Reath LLP
Yan Luo Partner
Covington & Burling LLP
Benjamin G. Joseloff Partner
Cravath, Swaine, & Moore LLP
Nathaniel B. Bolin
Partner
K&L Gates LLP
Mollie Sitkowski Partner
Faegre Drinker Biddle & Reath LLP
Erika Vidal-Faulkenberry
Global Head, Trade Compliance
Biogen
Rod Menas
Director, Export Compliance
Keysight Technologies
Nancy Fischer Partner
Pillsbury Winthrop Shaw Pittman LLP
Renee Latour Partner
Clifford Chance LLP
PRE-CONFERENCE WORKSHOP
Tuesday,
November 12, 2024
WORKSHOP A 9:00 am–12:30 pm (Registration opens at 8:30 am)
An In-Depth, Updated Compliance Roadmap to the Advanced Computing and Semiconductor Rule: Demystifying the Latest Updates, TGLs, Impacted ICs, Gap Analysis-and New Lessons Learned
Advanced semiconductor rule compliance is essential for maintaining market access and your competitive advantage. This workshop will assure you have critical points in place, taking risk mitigation to the next level. Instructors will employ hypothetical scenario planning and case study examples, and provide post-workshop take-away materials, all in a closed-door, collaborative setting. Bring your questions!
Topics will include:
• Determining what is restricted and where: Focus areas
» Sales restrictions
» Sales education
» Factory operations
» Consumers
• Compliance implementation and practices
» Classification reviews and product surveys:
Review the new ECCNs
3A090, 3A001.z, 3A991.p, 4A003.z, 4A004.z, 4A005.z, 4A090, 4A991.i, 5A002.z, 5A004.z, 5A992.z, 5D002.z, 5D992.z
Confirming the classification of items, including items that previously might have been classified as EAR99 or subject to only anti-terrorism (AT) controls
Assessing whether foreign made items are subject to the EAR under the de minimis and FDPR
Companies that procure these items as components need to confirm status with suppliers
» Evaluate licensing requirements:
Determining exports and services requiring authorization to Country Groups D:1, D:4 and D:5, as well as companies headquartered or parented in these countries
Considering whether new licensing requirements will eliminate or delay their ability to obtain certain critical items subject to the EAR for manufacturing operations
Evaluating options and strategies for use of NAC/ACA and the TGL
License Exception NAC: When you need prior notification to and authorization from BIS — compliance protocols to manage this process and build-in lead times
Hector Rivera Senior Director, Export and Sanctions Compliance Qualcomm Technologies Inc.
B. Bolin Partner
LLP
• Due diligence
» Due diligence “headquarters”
Defining the concept of “headquartered in”
Developing reasonable approaches to this issue, due diligence procedures, and documentation of their review
Diligence for private companies in China where ownership information is not transparent or for companies owned by private equity funds or other complex structures where owner headquarters location is not easily identified
Options for obtaining certifications and representations from customers concerning end use, location, headquarters/location
» U.S. person support, where “support” includes “facilitating” a shipment, transmission, or transfer
Reviewing US person involvement in semiconductor and supercomputerrelated activities, including those of senior management outside the US
Other touchpoints for “support” where you are not exporting an item subject to the EAR, but providing a specific service
• Temporary General License
» Language and translation challenges
» Testing control tools: Is test and validation a separate restricted end use?
Nathaniel
K&L Gates
Tuesday, November 12, 2024
WORKSHOP B 1:30 pm–5:00 pm (Registration opens at 1:00 pm)
Third Party and Supply Chain Due Diligence and Resilience: Revisiting Export, UFLPA and Sanctions Risk Assessments, Compliance and Monitoring
Third party risk management in China is increasingly critical due to the complexities of operating in China’s evolving regulatory environment and the reliance on extensive supply chains and partnerships. As companies engage with local vendors, suppliers, and other third parties, they must navigate a complex web of risks.
Building on the previous workshop, this session will discuss how to re-evaluate your organization’s risk profile and program as geopolitical and compliance challenges continue to mount. Topics will include:
• Third-party and supply chain risk ranking: Developing a due diligence model that stratifies your risk based on third parties — and how to perform due diligence accordingly
• US sanctions on mainland China and Hong Kong — and evolving due diligence and monitoring in response to changing sanctions
» Sanctions on Xinjiang Production and Construction Corps (XPCC) and implications for compliance
» China’s countermeasures: Understanding China’s Countering Foreign Sanctions Law
» Special status of Hong Kong in U.S. legislation
Toochi Ngwangwa
US Global Trade Counsel
Sandvik Manufacturing Solutions
Bryce Bittner
Managing Counsel, International Trade Legal McKinsey & Company
• Re-Assessing sanctions risks associated with each tier of your supply chain: Evaluating your risk profile and tolerance
• Working with verified entities – How much due diligence is enough?
• How to conduct a sanctions risk assessment as part of your compliance program
• UFLPA
» Requirements and expectations for due diligence
» How far do you need to go at the due diligence phase
» The scope of documentation and more items that are required to rebut the presumption of forced labor
» How AI and open-source research can be used to conduct global supplier due diligence
» Types of secondary due diligence (e.g., transaction testing, deeper-dive due diligence reports, forensic testing)
• Export controls and third-party audits and assessments
» Updating questionnaires regarding export compliance programs and practices — and dealing with uncooperative third parties
» Strengthening compliance clauses: Ensuring contracts include specific clauses requiring third parties to comply with all applicable export laws and regulations
» Addressing the hurdles to exercising third party audit rights
» To what extent you can require training — and the pros and cons of providing training
» What to do with information uncovered during the vetting process: How to evaluate suspected or actual issues
U.S.
Moderator:
Former
U.S.
Jeanette
National Foreign Trade Council; Former Senior Policy Advisor, Bureau of Industry Security (BIS), U.S. Department of Commerce
10:15
10:45
Deciding If and How to Continue Business Operations in China: Aligning Business, Operations, Trade Compliance and Risk Management
• Leveraging joint ventures to maintain select China operations
• What are the business thresholds for maintaining China operations?
• What are the impacts of China’s US export control/sanctions countermeasures on businesses in China: The relationship between The Anti-Foreign Sanction Law, Unreliable Entity List and the Blocking Order
• Completing the factual and legal due diligence and analysis needed to achieve clarity about the status of your business with China under international trade restrictions
Sarah O’Hare O’Neal
Deputy General Counsel, International Trade Law Microsoft
Elizabeth Fitzpatrick Vice President and General Counsel, Global Trade Sanctions Honeywell
11:45 STRATEGY SESSION #1 (Hypothetical Scenarios and Audience Polling)
Making the Toughest Export Compliance Calls on China: de minimis, FDPR and the Interplay with Economic Sanctions
Using hypothetical scenarios and audience feedback, this session will delve into the most vexing grey areas and compliance pain points
FDPR:
• Avoiding key pitfalls when applying the FDPR
• Foreign Direct Product Rule (FDPR)/advanced computing export controls rules
• de minimis threshold decision-making
Mark Jones
Export Compliance Manager WILO USA LLC
» Examine necessary tools your peers are using for when your compliance teams are stumped by:
Impacts of the FDPR rule: How do you tighten up compliance oversight around third-party due diligence procedures?
Pillsbury Winthrop Shaw Pittman LLP
Conducting gap analysis: Updating your compliance program protocols to make sure legal, engineering, and trade compliance are all in the loop
What constitutes “controlled content”
Ineligible items for de minimis
Standardized methodologies of calculations, documentation, record and communication
Mollie Sitkowski Partner
Faegre Drinker Biddle & Reath LLP
Nancy Fischer Partner
• Employee training and monitoring
» Understanding internal processes that lead to the export transaction: Working with all teams involved including development, fulfillment, logistics, finance and IT
» Has the company provided tailored training for high-risk and control employees?
» What resources have been available to employees to provide guidance
• Conducting gap analysis: Updating compliance programs to make sure legal, engineering, and trade compliance are all in the loop with new controls
• Third-party management
» Developing a model that stratifies your risk based on third parties — and how to perform due diligence accordingly
» What to do with information uncovered during the vetting process: How to evaluate red flags
Elizabeth Cannon Executive Director of the OICTS, Bureau of Industry and Security U.S. Department of Commerce
Jeanette Chu Vice President, National Security Policy National Foreign Trade Council; Former Senior Policy Advisor, Bureau of Industry Security (BIS), U.S. Department of Commerce
Businesses will need to keep a closer eye on their digital supply chains as the U.S. government introduces measures to secure the information and communications technology (ICTS) infrastructure from exploitation by foreign adversaries. The latest ANPRM now also brings connected vehicles (CVs) technology under the ICTS microscope.
How is industry screening, or preparing to screen, such transactions out of their existing supply chains?
Heather Ludwig Trade Compliance Counsel, Director Nidec Motor Corporation
Michael Bermudez Vice President, International Trade Compliance
Parsons
Bowen Export and Trade Compliance Counsel ServiceNow
Moderator:
Bob
Dr. Chris Timura Partner Gibson Dunn
3:45 EXPORT SANCTIONS AND GEOPOLITICAL RISKS IN THE BIG PICTURE
How Senior Corporate Leadership is Evaluating and Ranking Trade, Cyber, Data Privacy and Supply Chain Risks
This session will feature corporate executive insights into current supply chain risks amid increased cyber hazards, the Bulk Data EO, evolving advanced computing restrictions, as well as increased technological restraints in a tense geopolitical environment.
Irene Chiu Senior Vice President & Chief Compliance Officer
MicroPort
Orthopedics
4:30 HYPOTHETICAL SCENARIOS AND AUDIENCE POLLING
Michaael DiPaula-Coyle
Head of International Trade Policy/Director for Trade, Enterprise Risk and Supply Chain Resiliency
IBM
MEU, MIEU and CCMC Rules: New Enforcement Risks and the Hidden Lessons for Updating Compliance and Licensing Practices
• How industry is updating screening, compliance policies and procedures around MEU, MIEU and CCMC regulations: What are best practices?
• Getting previous Returned Without Action (RWA) notices approved:
» HYPOTHETICAL SCENARIO: What do you do if a customer’s subcontractor ends up on the MEU list, even if they have no military intent? How do you prove to BIS that this subcontractor will avoid military activities to get your RWA approved?
• License applications, approvals, and denials: What are the lessons learned from ever-evolving trends?
• CMMC, MEU, MIEU tools:
» Development of a Heat Map to focus on risk-based compliance
» Preparing questionnaires to help the business flag risk areas
» Leveraging relationships in countries where business opportunities are likely to arise
• Beneficial owner screening:
» Screening for the customer and any entity with a 50% or greater ownership interest
Sahra Park-Su
Lead Senior Legal Counsel, Global Export Controls and Trade Sanctions
SAP
Debbie Shaffer
Senior Manager, Global Trade Compliance L3 Harris Technologies
Jahna Hartwig Partner
Wilson Sonsini Goodrich & Rosati
» Best practices around screening all significant shareholders (5% or more) and the company’s Directors and Officers
• Resources beyond screening:
» Open-source research: Conduct searches of each end-user to verify and confirm business relationships and dealings
» Questionnaires
Inquiring about the use of products, requests for org charts and end use certificates
End Use Certification: Customer confirmation of their anticipated end use of the product
End User Questionnaire: Conducting due diligence to determine an entity’s ownership, business background and intended use of product
5:15 Close of Day One
Networking Cocktail Reception
7:30 Registration and Continental Breakfast
8:45 Opening Remarks from the Co-Chairs
Rebecca Conover Senior Director, Export Controls and Sanctions Intel
9:00 FIRESIDE CHAT
Barb Secor Vice President, Global Trade Compliance
Thermo Fisher Scientific
Special Update on Disruptive Technology Task Force Enforcement
Kevin Kurland
Deputy Assistant Secretary, Bureau of Industry and Security U.S. Department of Commerce
Eun Young Choi
Deputy Assistant Attorney General, National Security Division U.S. Department of Justice
Ajay Kuntamukkala Office Managing Partner Hogan Lovells
Renee Latour Partner
Clifford Chance LLP
9:30 STRATEGY SESSION #2 (Hypothetical Scenarios and Audience Polling)
Managing Cross Border Data Transfers Under the Proposed Bulk Data EO Regulations: Aligning Risk Mitigation for Export Compliance and Licensing
Businesses and entities involved in data-related activities must adapt to an evolving regulatory landscape to ensure compliance and protect their operations from potential risks. How are multinationals preparing for anticipated enforcement around the Bulk Data EO?
• The concept of “controlled” to include bulk sensitive data that might not traditionally fall under the EAR other ITAR
• How the proposed rule aligns with export control restrictions that focus on preventing the transfer of critical technologies and sensitive information
• Reviewing transactions involving bulk sensitive data with foreign adversaries, similar to how export controls require licenses for certain exports to controlled destinations
• How both the EO and export controls use similar criteria to assess national security risks, including the potential use of data for surveillance or intelligence activities
Hena Schommer Director, Trade Legal Applied Materials
Yan Luo Partner
Covington & Burling LLP
Moderator:
Integrating Export Controls and Economic Sanctions for an Optimal Compliance Program: Revisiting Your Organization’s Risk Profile and Detecting Program Weak Spots
Panelists will describe the evolution of their economic sanctions and export compliance programs, lessons learned, what tools they have used, and other hallmarks of a best-in-class program.
Topics will include:
• Key components and solutions that companies have integrated within their current processes
• Using root cause analysis to identify recurring problems and improve compliance efficiencies
• Industry specific challenges – Semiconductor, telecom, aerospace & defense, life sciences, automotive, etc.
» Program differences and similarities between industries
• Integrating evolving export controls into your policies, systems and third party and supply chain management
» Assessing the benefits of self-disclosure amid a possible violation
• Getting buy-in for compliance efforts from the top down
Julia Khersonsky Deputy Assistant Secretary for Strategic Trade Bureau of Industry and Security
U.S. Department of Commerce
Barb Secor Vice President, Global Trade Compliance Thermo Fisher Scientific
Mollie Sitkowski Partner Faegre Drinker Biddle & Reath LLP
1:45 TRANSACTIONAL RISK MANAGEMENT
Export, Sanctions, JV and M&A Transaction Risk Management in China: How the Financial Community is Re-Assessing Their Risk Tolerance and Decision-Making
• How are financiers changing their risk assessments and what have the impacts been on those making investments?
• Screening supply chains for compliance and revisiting contractual obligations for risk mitigation
• Leveraging joint ventures to maintain select China operations
• What are the business thresholds for maintaining China operations?
• What are the impacts of China’s US export control/sanctions countermeasures
2:30 FOREIGN ADVERSARY CONTROLLED APPLICATIONS
Director, Financial Crimes Legal
(Hong Kong)
Beyond TikTok: The Establishment of the Committee for the Review of Foreign Adversary Controlled Applications
When Congress passed the Protecting Americans from Foreign Adversary Controlled Applications Act in April 2024, most of the headlines focused on the law’s effect on a single popular social media app: TikTok. In July 2024, however, President Biden used authorities under the new law to establish the Committee for the Review of Foreign Adversary Controlled Applications, which could have far-ranging consequences across the digital landscape. What is the status of the new committee and how will it fit in among the U.S. Government’s other tools for combatting commercial hybrid threats?
3:15 Networking Break
S.
3:30 UFLPA and the Interplay with Export Controls and Sanctions Compliance: New Lessons Learned
• Exporting UFLPA detained/excluded merchandise (when/how/where)
• Should economic sanctions and export compliance tools be applied to UFLPA — and, if so, to what extent?
• Overlap between UFLPA Entity List and BIS Entity List for human rights violations
• Shared Government Agencies participating in the FLETF and End-User Review Committee Sasha Kalb
4:15 REPUTATIONAL RISK AND NIGHTMARE SCENARIOS
The Unwritten Lessons for Reputational Risk and Crisis Management: Recent Examples of Hits and Misses
• How reputational risks have evolved for exporters doing business in China
• Rethinking China-centric reputational risk management amid geopolitical shifts, a rise in shareholder activism, public pressures and enforcement developments
• The evolving role of legal and compliance in managing reputational risk
• Managing the reputational aftermath of an enforcement action
• Implementing new Board and Audit Committee priorities, including anti-bribery, ESG and emergency preparedness
David A. Ring
Partner
Wiggin and Dana LLP
Rod Menas
Director, Export Compliance
Keysight Technologies
5:30 Close of Conference
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