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Overview  

The primary responsibility of the Bureau of Industry and Security (BIS), an agency in the Department of Commerce, is granting licenses for the export of sensitive goods and technologies, balancing commercial interests against those of national security. But the bureau also enforces sanctions and embargoes, works with other countries on export controls, monitors the health of the domestic defense industry and promotes U.S. trade interests abroad. The BIS therefore has a range of responsibilities relating to the interaction between industry and security. Since the Sept. 11 terrorist attacks, emphasis has been placed on restricting the export of technologies that could be used to create weapons of mass destruction.

 
History  

Export control has been an element of government policy for as long as the United States has existed. However, it took on great significance during the Cold War, when it was deemed necessary—for national security reasons and as a tool of foreign policy—to prevent sensitive goods from being sent to the Soviet bloc. Congress enacted the Export Control Act of 1949, creating a system for Cold War export control. The act was renewed repeatedly until the late 1960s, when thawing relations with the Soviet Union made some question whether export controls should be loosened. The Export Administration Act of 1969 did relax controls, and also delegated congressional authority to regulate foreign commerce to the executive branch, on a temporary basis. Subsequent renewals of this act in 1974, 1977, 1979 and 1985 further eased controls.

 In 1989, the collapse of the Soviet Union forced a debate on the future of export controls; some pushed for further liberalization in order to promote U.S. exports, while others thought controls should be tailored to address security threats in the post-Cold War era. However, Congress was unable to agree upon changes, and in 1994, the EAA lapsed—only to be continued for six years by Executive Order No. 12924, issued by President Bill Clinton on Aug. 19, 1994. Clinton derived the authority to do this from the International Emergency Economic Powers Act, which allows the president to declare an emergency and control exports for national security or foreign policy reasons.
 
In 2000, Congress enacted a law reinstating the 1979 version of the EAA until Aug. 20, 2001. That act was also allowed to lapse, and again, the president—this time, George W. Bush—continued the export controls by executive order. There have been legislative attempts since then to revise the EAA rules, but none have succeeded (see Suggested Reform).
 

The Bureau of Export Administration previously enforced EAA provisions. In 2002, the Commerce Department ordered that the agency be renamed the Bureau of Industry and Security, as part of an internal reorganization. In a 2002 speech, Under Secretary of Commerce

Kenneth I. Juster

, former head of the BIS, said this was done to “reflect the fact that our agency works on a broad array of issues at the intersection of industry and security—whether it be national security, economic security, cyber security or what is now known as homeland security.”

 

What it Does  

Many exports that are subject to BIS controls—including certain types of machinery, software and technical specifications—have both commercial and military applications, and are therefore dubbed “dual-use items.” Individuals or companies seeking to export these and other controlled goods must go through a licensing process that takes into account what the items are, where they’re going, who will be using them and for what purpose. According to the BIS Web site, there are 10 broad licensing categories: nuclear materials, facilities and equipment; chemicals, microorganisms and toxins; materials processing; electronics; computers; telecommunications and information security; sensors and lasers; navigation and avionics; marine; and propulsion systems, space vehicles and related equipment.
 
Export prohibitions vary depending on where the goods are being sent. Countries that are currently being embargoed by the United States, or have been designated supporters of terrorism, are subject to the tightest controls. Right now, that list includes Syria, Sudan, Iran, North Korea and Cuba. The bureau also maintains a list of individuals, entities and organizations that are prohibited from receiving exports because of alleged involvement in terrorism and drug trafficking, in the proliferation of weapons of mass destruction, or because the bureau couldn’t complete an adequate background check.
 
The BIS comprises many offices. In addition to licensing, the agency’s Export Administration performs a variety of functions that promote U.S. trade competitiveness. The EA is further broken down into five divisions: the Office of Nonproliferation and Treaty Compliance, the Office of Strategic Industries and Economic Security, the Office of Exporter Services, the Office of Technology Evaluation and the Office of National Security and Technology Transfer Controls.
 
Just as its name suggests, the Office of Export Enforcement is the bureau’s enforcement arm. It has three divisions: the Office of Export Enforcement, the Office of Enforcement Analysis and the Office of Antiboycott Compliance.
 
The BIS’ Operating Committee on Export Policy is the first forum for resolving disputes among agencies over controversial license applications.
 
For more information on the divisions, see this BIS-produced pamphlet
 
For more information on other topics, see:
 
 
Licensing, from the BIS Web site
 
Seminars and Training, from the BIS Web site
 
Defense Industrial Base Programs, from the BIS Web site
 
Export Control Blog, from the BIS Web site
 

Press Releases, Annual Reports and Foreign Policy Reports through 1996

, from the BIS Web site

 

Where Does the Money Go  

Major stakeholders include the U.S. military, the domestic defense industry and congressional districts in which defense-industry companies are major employers. Companies and individuals that export goods or technologies subject to the provisions of the EAA are also stakeholders.

 

Controversies  

BIS controversies often illustrate the tension between national security and free trade.

In October 2007, the federal government initiated a program to reduce the licensing requirements for certain military goods shipped to five Chinese companies. However, a report from the Wisconsin Project, a nonpartisan organization dedicated to stemming the proliferation of weapons of mass destruction, asserted that at least two of these companies have been linked to proliferation activities. “Reducing controls on exports to such companies increases the risk that American goods will help China improve its armed forces, and that American goods will be sent illicitly to Syria or Iran,” the report said.
 
In addition, the Arms Sales Monitoring Project (ASMP), a subgroup of the Federation of American Scientists, has issued a report that says U.S. arms exporters are increasingly bundling their sales with “offsets,” or side agreements in which purchasers receive bonus technology or manufacturing capabilities. According to the ASMP, some of these offsets “raise serious security concerns, as they assist in the development of foreign arms industries,” and have also exposed inadequate export-licensing enforcement by the BIS.
 
On the other hand, the business community pushed back against a proposal that would have tightened export controls on technological products in early 2007. The Bush administration floated the idea of expanding the definition of dual-use items in 2006, so that a greater number of exports fell under the BIS’ jurisdiction. This had some exporters worried that they would be burdened by red tape. In response, the BIS said it would revise its proposal.
 
An October 2006 computer attack against the BIS network crippled the agency, forcing it to replace hundreds of computers. Now, workstations on the BIS network reportedly are disconnected from the Internet; employees must switch to separate stations for Web access. Investigators say the hackers worked through Chinese servers.
 
For more information, see:
 
 
US Lawmaker: 2 Cos in Export Program Tied to Chinese Military, an AP article available through CNN Money
 
Our Trivialized Cuba Policy, an opinion piece by Mauricio Claver-Carone appearing in The New York Sun
 
Offsets Definitions, from the BIS Web site
 
 
US May Tone Down Its Stance on Exports, a report in the EE Times
 

Recent Changes Regarding Export License Control

, an article written by lawyers Rajat P. Kuver and Daniel C. Horne appearing in

Bender’s Immigration Bulletin

 

Debate  

Discussion about the BIS and export controls generally takes the form of a dialogue between camps: those pushing for fewer export controls in order to boost economic prosperity, and those advocating the status quo or even greater export controls, due to national security concerns.

Critiques and Reports
 
The Export Administration Act: Evolution, Provisions and Debate, a report by Ian F. Fergusson, specialist in international trade and finance, for the Congressional Research Service
 

Export Administration Act of 1979 Reauthorization

, a report by Ian F. Fergusson, Robert D. Shuey, Craig Elwell and Jeanne Grimmett for the Congressional Research Service

 

Suggested Reforms  

In 2001, Sen. Mike Enzi, a Republican from Wyoming, introduced the Export Administration Act of 2001, which would have delegated Congress’ constitutional authority to regulate foreign commerce to the president—without a sunset provision. Rep. Benjamin Gilman, a New York Republican, introduced a related bill, HR. 2581, in the House. Neither passed.

On Jan. 22, 2008, the Bush administration unveiled new directives on export controls it says will help balance national security with the needs of globalization. “The United States continues to face unprecedented security challenges, including terrorist threats from the proliferation of weapons of mass destruction and advanced conventional weapons to unstable regions of the world,” a White House press release said, adding that the country “also faces economic challenges from the increasing worldwide diffusion of high technology and global markets.”
 
The administration is still pushing for legislation that will overhaul the 1979 EAA.
 
For more information, see:
 

Streamlining and Strengthening Export Controls

, from the BIS Web site

 

Congressional Oversight  
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Table of Contents

Founded: 1987, 2002
Annual Budget: $79 million (2008)
Employees: 402 (2008 estimate)

Bureau of Industry and Security
Hirschhorn, Eric
Undersecretary

The agency responsible for ensuring that technology that can be used to build weapons of mass destruction does not fall into the wrong hands has a new leader, following a confirmation delay of more than six months. Eric L. Hirschhorn, whom President Obama nominated on September 11, 2009, received a recess appointment from the President on March 29, 2010. Hirschhorn’s appointment had been held up by Arizona Senator John Kyl, who was demanding answers to certain questions regarding the administration’s export control review process. The responsibilities of the Bureau of Industry and Security (BIS), an agency in the Department of Commerce, include granting or denying licenses for the export of sensitive goods and technologies, enforcing sanctions and embargoes, and promoting U.S. trade interests abroad.

 
Born on April 28, 1946, Hirschhorn grew up in New York City, where his father owned an advertising agency and his mother worked for the health care workers union, Local 1199SEIU. He earned his B.A. from the University of Chicago in 1965 and his law degree from Columbia University Law School, where he was a Harlan Fiske Stone Scholar in 1968. 
 
Commencing his legal career as a public interest lawyer, Hirschhorn joined MFY Legal Services in New York as Reginald Heber Smith Community Lawyer Fellow, a position he held from 1968 to 1971. Switching to policy work in 1971, Hirschhorn worked as Counsel for the Democratic Study Group in the New York State Assembly, advising newly elected Democratic state legislators on legislative issues. From 1971 to 1973, he served as Legislative Assistant to Democratic Congresswoman Bella Abzug, a leading advocate of the women’s movement who was also the first Jewish woman ever elected to Congress. From 1975 to 1977, he served as Chief Counsel for the House Subcommittee on Government Information and Individual Rights.
 
Joining the Carter Administration in 1977, Hirschhorn served as Deputy Associate Director for International Affairs and Trade in the Office of Management and Budget, and as Counsel to the President’s Reorganization Project.  In 1977 he directed the preparation of a plan to combine the U.S. Information Agency with the State Department’s Bureau of Educational and Cultural Affairs.
 
 In 1980, President Carter appointed Hirschhorn to run the Bureau of Export Administration, the predecessor agency to the BIS, a post he held until 1981. 
 
When Ronald Reagan took over the White House, Hirschhorn resumed private law practice in the field of international trade.  After first working at Johnston, McGeorge & Davidson, he became a partner in the Washington, D.C., office of Winston & Strawn, where he remained until joining the BIS in March 2010. As a lobbyist at Winston & Strawn, he represented Lockheed Martin, Sun Chemicals and high-tech firms, among others. In a 1995 editorial in the Journal of Commerce, he argued against pre-shipment reporting and clearance of goods to be exported.
 
Hirschhorn has been a consistent critic of unilateral trade sanctions by the U.S. He opposed President Clinton’s proposed trade sanctions against Iran, and spoke out against limiting trade with China if the Chinese military might be involved. In 2001 he called regulating the export of computers other than supercomputers “a pointless exercise” because such computers could be purchased from other countries. In 2007 Hirschhorn represented the National Foreign Trade Council in its lawsuit opposing the state of Illinois’ ban on trade with Sudan.
 
During his confirmation hearing for BIS undersecretary on November 5, 2009, Hirschhorn said that he would not allow his longtime advocacy work for less restrictive export controls to interfere with the Obama administration’s use of unilateral sanctions.
 
Although Hirschhorn ceased to be a registered lobbyist in 2005, he continued to work for Winston & Strawn as a “government relations advisor.”
 
Starting in 1986, Hirschhorn was also Executive Secretary of the Industry Coalition on Technology Transfer, a trade group that advocates and lobbies for companies involved in exports, especially defense-related exports. 
 
Hirschhorn is the author of The Export Control and Embargo Handbook, and numerous other publications on export regulation and legal ethics issues. 
 
He has also dealt with matters related to professional responsibility and conflict of interests. He chaired the D.C. Bar Legal Ethics Committee and the D.C. Bar Rules of Professional Conduct Review Committee.
 
A lifelong Democrat, since 1992 Hirschhorn has contributed $22,312 to various Democratic candidates and causes, including $1,500 to the Democratic National Committee, $2,562 to the presidential campaign of Barack Obama, $500 to Senator John Kerry, $1,000 to Vice President Al Gore, $1,000 to President Bill Clinton, and $300 to the California campaign to prevent the abolition of gay marriage in that state. Hirschhorn is a member of the District of Columbia and New York bars. 
 
Hirschhorn, who was married once before, has been married since 1981 to law professor Leah Wortham, who teaches at Catholic University in Washington, DC. The couple has three children, Alex, Elizabeth and Anne. 
 

Professional Profile (Martindale-Hubbell)    

 
Mancuso, Mario
Previous Under Secretary

The Bureau of Industry and Security is headed by Mario Mancuso, undersecretary of commerce for industry and security. Mancuso was born in New York and grew up in Howard Beach, Queens, where his parents ran a pizza parlor. He graduated magna cum laude from Harvard University. He then received a law degree from New York University School of Law, before moving on to the private sector, where he worked for a decade as an international corporate lawyer and business executive.

 
Mancuso is a veteran of the Iraq War; he served as a special operations commander for nearly a year. Between January and July 2005, Mancuso served as special counsel to the Department of Defense general counsel, focusing on issues of international law, national security policy and international affairs. He then worked as deputy assistant secretary of defense for special operations and combating terrorism. The U.S. Senate unanimously confirmed him as undersecretary of commerce for industry and security on May 25, 2007.

 

 
 


 
 
 
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