Government Contracts EAR Rule Suspends License Exceptions for Hong Kong
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Tuesday, August 25, 2020

EAR Rule Suspends License Exceptions for Hong Kong

By Government Contracts Editorial Staff

The Bureau of Industry and Security has amended the Export Administration Regulations to suspend the availability of license exceptions for exports and reexports to Hong Kong, and transfers within Hong Kong, of all items subject to the EAR that provide differential treatment from the license exceptions available to the People’s Republic of China. BIS issued the final rule as part of revised U.S. policy in response to newly imposed security measures on Hong Kong by the Chinese Communist Party. According to the rule, these new security measures undermine Hong Kong’s autonomy and increase the risk that sensitive U.S. technology and items will be illegally diverted to unauthorized end uses and end users in the PRC or to unauthorized destinations such as Iran or North Korea. The rule suspends 13 license exceptions in EAR Part 740. The rule amends EAR 740.2, Restrictions on all License Exceptions, to identify the suspension of the availability of these license exceptions for exports to Hong Kong, reexports to and from Hong Kong, and transfers within Hong Kong, of all items subject to the EAR. This rule includes saving clauses for items, including deemed exports. The rule went into effect on July 31, 2020. For the text of the rule, see ¶72,750.483.

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