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Department of Commerce Declines to Pursue Export Restrictions for Electronic Components

Following ISRI’s meeting with the Bureau of Industrial Security (BIS) and subsequent comments, ISRI met again with the Commerce Department staff in late June to further explain our arguments against this proceeding. This proceeding was initiated after several unsuccessful attempts to pass federal legislation to restrict exports of certain electronic devices based on false stories of used electronics from the United States being dumped in developing nations that was refuted by several governmental and non-governmental reports in 2011-2013. One of ISRI’s main arguments was halting the exports of used electronics would not solve the problem of counterfeit electronic parts since the evidence indicates counterfeit parts are not coming from used electronic devices and the counterfeiting is coming directly from the manufacturing origins of those electronic devices. More importantly, the United States Senate already outlined an effective plan within the 2012 National Defense Appropriations wherein the law instructed defense contractors to establish trusted supply chains and conduct 100 percent testing of products. ISRI argued that this process has been very effective for sensitive military applications and should be extended to critical infrastructure and other sensitive electronic applications. In less sensitive applications such as smartphones, the manufacturers already have very secure supply chains and routinely test the millions of devices they produce each year to identify counterfeiting problems. Other organizations including electronics and other manufacturers also argued this proceeding was unnecessary and would be ineffective for largely the same reasons as ISRI’s. The BIS agreed with these arguments and indicated they were not planning to take further action.  Several days following our meeting, the legislation to restrict exports of electronics was introduced again in the House of Representatives. ISRI will be strongly arguing that this legislation is still not necessary nor will it be effective at stopping counterfeit electronics from entering the marketplace. 

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