Where Industry and Security Intersect
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The meeting was called to order at 9 A.M. There were approximately 130 people in attendance, including 10 of the 12 DEAC members, the press, government officials and the general public. Seated on the stage were:
DEAC members
Norm Augustine
Dr. Robert Gates
Dr. Albert Carnesale
Sean O’Keefe
Dr. Anthony Frank
Dr. James Siedow
Dr. Ruth David
Dr. William Wulf
Mike Splinter
General John Gordon
Department of Commerce
Dr. David Sampson, Deputy Secretary
John Sullivan, General Counsel
Johnnie Frazier, Inspector General
Mark Foulon, Acting Under Secretary for Industry and Security
Christopher Padilla, Assistant Secretary for Export Administration
Darryl Jackson, Assistant Secretary for Export Enforcement
Bernard Kritzer, Director, Office of National Security and Technology Transfer Controls, DEAC Designated Federal Official
Other Government Agencies
Dave McCormick, Deputy National Security Advisor, National Security Council
Dr. Sharon Hayes, Associate Director, White House Office of Science and Technology Policy
Kenneth Krieg, Under Secretary of Defense for Acquisition, Technology and Logistics
Under Secretary Foulon called the meeting to order. He briefly outlined the agenda and discussed the reasons behind the formation of the DEAC. Under Secretary Foulon explained that the creation of the DEAC was an example of sound policy, involving the collaboration of the different stakeholders involved in deemed exports.
Immediately following Under Secretary Foulon’s introduction, Deputy Secretary of Commerce David Sampson spoke. Deputy Secretary Sampson opened by thanking Deputy National Security Advisor Dave McCormick, whose efforts while at the Department of Commerce, were instrumental in moving the DEAC from concept to reality. During his remarks, Deputy Secretary Sampson highlighted the critical need to get any changes to deemed export policy correct. According to Deputy Secretary Sampson, the ability of the DEAC to perform a comprehensive, top-down review of deemed export policy would contribute significantly to both the long term national security of the U.S. and America’s position as the leading global innovator.
The two DEAC co-chairmen then took the floor. Norm Augustine discussed the need for the DEAC to be flexible and consider viewpoints and opinions from all parties involved. Gates pointed out that the existing export control system was established during the Cold War, with one primary adversary. Today we live in a much different world. One where the globalization of commerce and science is evolving rapidly, where the Internet allows for the instantaneous sharing of research and the contributions of science to our economy are as important as ever. At the same time, we operate in an environment where adversaries and friends alike, attempt to steal U.S. technologies. According to Gates, the role of the DEAC is to examine deemed exports to develop recommendations for changes in current polices that (1) protect real national security interests and (2) protect the freedom of scientific inquiry, that is vital to our economic competitiveness.
Deputy National Security Advisor Dave McCormick thanked the DEAC for its willingness to step up to this important challenge. McCormick mentioned that the first DEAC meeting was the byproduct of interagency collaboration, including the Departments of Commerce, Defense, State and the White House. In addition, McCormick indicated that the DEAC could be used as potential model for future collaboration between the government and research communities. Lastly, McCormick stated that he hoped the recommendations provided by the DEAC would be seen as credible by those who must implement them.
Sharon Hayes, Associate Director, White House Office of Science and Technology Policy (OSTP) then briefly explained the role of OSTP. In addition to advising the President on science and technology, OSTP coordinates science and technology issues across the entire federal government. Hayes discussed OSTP’s previous experience with deemed exports; it chaired an interagency working group which advised the Department of Commerce on deemed exports from the perspectives of the national research agencies (National Science Foundation, the National Institutes of Health and the Department of Energy). Hayes stated that the contributions of foreign nationals to U.S. national security efforts have been nothing short of profound. Despite this, the threats are real. Hayes noted that the difficult issue is to determine who the bad actors are while not stifling research by choking off the influx of the best and brightest from around world.
Immediately following Ms. Hayes’ speech, the floor was opened up for public comments. Only three individuals offered comments. All spoke to the difficulty of determining an effective deemed export policy.
Terry Murphy/M.K. Technologies – Murphy explained he has previous experience with the issue through a workshop he co-chaired on deemed exports at the Center for Strategic and International Security in May 2005.
Bill Root/Independent Consultant – Root voiced his opinion that there technically is no statutory authority for deemed exports, since a ‘deemed’ export does not meet the definition of export from the Export Administration Regulations (EAR). Activities covered by EAR and current Executive Orders are intended for foreign transactions, not domestic activities. Root asserted there still is considerable confusion within the academic community on what controlled technology is. He closed his remarks by offering a potential solution: return to the rules which governed transfers of technology before the deemed export rule was established in 1994.
Jonathan Epstein/Holland Knight, LLP – Knight explained there are significant Constitutional and statutory issues when the government asks industry to examine American citizenship based on birthplace or nationality. He referenced Title VII, which makes it hard for companies to take action with respect to individual employees. Knight concluded by reminding the DEAC to consider the perspective of rank and file export compliance personnel. If the DEAC’s recommendations are not able to be implemented, then any rule changes will not have the desired effect.
Under Secretary Foulon closed the open session of the DEAC at 10 A.M.