Overview
On November 26, the US Department of Commerce (DOC) issued a proposed rule to implement Executive Order 13873 (Executive Order on Securing the Information and Communications Technology and Services Supply Chain) that could have far-reaching consequences for certain transactions involving information and communications technology and services (ICTS). The proposed rule covers a wide variety of transactions and would give DOC significant discretion to review, prohibit, or require mitigation for such transactions. The public comment period, initially set to close on December 27, has been extended to January 10, 2020, after which DOC will review submitted comments before taking further action.
Review Criteria:
In evaluating a given transaction, the Secretary of Commerce and other enumerated US government officials will consider five specific criteria, including whether:
- the transaction is “subject to the jurisdiction of the United States;”
- the transaction involves property in which a foreign country or foreign national has an interest, including a contractual interest for the provision of a technology or service;
- the transaction was initiated, pending, or incomplete as of May 15, 2019;
- the transaction involves ICTS “designed, developed, manufactured, or supplied, by persons owned by, controlled by, or subject to the jurisdiction or direction of a foreign adversary;” and
- the transaction: “(1) poses an undue risk of sabotage to or subversion of the design, integrity, manufacturing, production, distribution, installation, operation, or maintenance of information and communications technology or services in the United States; (2) poses an undue risk of catastrophic effects on the security or resiliency of United States critical infrastructure or the digital economy of the United States; or (3) otherwise poses an unacceptable risk to the national security of the United States or the security and safety of United States persons.”