U.S. Will Relax Most High-Tech Export Curbs

The Bush Administration announced Monday that it plans to end Cold War-era requirements that U.S. firms obtain export licenses on most of the high-technology goods that they ship to other Western countries--a move that will affect about $30-billion worth of trade.

The order, which will become effective in two weeks, is the first formal step that the Administration has taken to ease export-licensing requirements on U.S. trade with the Western allies, a relaxation that American business has sought for years.

Commerce Department officials said that the deregulation primarily will affect three major categories of exports--computers, semiconductor-manufacturing equipment and telecommunications equipment.

Dennis Kloske, undersecretary of commerce for export administration, said that the elimination of requirements for export licenses will ease the administrative burden for U.S. firms and make them more competitive within the Western alliance.

Nevertheless, partly to help ensure that buyers do not re-export the strategic technology they receive, the regulations require U.S. exporters to keep on file basic information about the firm that is purchasing their products.

As a result, initial reaction from the business community was lukewarm. William T. Archey, international vice president of the U.S. Chamber of Commerce, said that the easing is welcome but that it is “tempered” by the requirement for added data. He branded the action “an interim step.”

The move was taken on the heels of a June 7 agreement by the United States and its major allies on a sweeping overhaul of Western restrictions on high-technology exports to the Soviet Bloc, expected to ease the way for sales of goods needed to modernize Eastern Europe.

Congress also is moving to force the Administration to liberalize its rules. The 1988 Omnibus Trade Act ordered the White House to streamline previous rules. And a new bill by Rep. Sam Gejdenson (D-Conn.) would eliminate all such licensing requirements by 1991.

However, Administration policy-makers said that the process was speeded up by the allies’ accord on East-West trade and by the faster-than-expected movement within the European Community to create a single, integrated European market by 1992.

If the United States had not relaxed its restrictions on exports to other Western allies, it could have left American producers facing a two-tiered export-control process in which U.S. firms were put at a visible disadvantage against European firms in their product lines.

U.S. officials said that the United States next must make sure that its own regulations are consistent with those of other Western countries so that the allies can adopt common security standards for high-tech exports by next April 30, as promised.

The relaxation announced Monday will have no impact on current requirements that firms obtain licenses when the products they are selling to a Western country are to be re-exported to a former Soviet Bloc nation. In such instances, previous rules remain intact.

U.S. officials said that they probably will have to draft special procedures for technology and equipment that is destined for East Germany--particularly if that country’s scheduled reunification with West Germany is accelerated, as seems more and more likely.

Commerce Department officials estimated that the relaxation announced Monday would eliminate the need for about 20,000 of the 25,000 licenses that the agency issued in 1989 for exports to Western countries, including 90% of those for semiconductor-manufacturing equipment.

Eastern Europe is now opening up, but exports to Western allies still account for virtually all the trade in strategically sensitive technology. The United States has been among the most stringent of the Western allies in regulating the flow of such goods.

The June 7 accord signed by members of the 17-country Coordinating Committee on Multilateral Export Controls, known as Cocom, relaxes restrictions on East European countries that agree to help enforce Cocom rules.

So far, only Poland, Hungary and Czechoslovakia have agreed to follow Western enforcement procedures. U.S. officials said Monday that a team of American advisers will travel to those three countries in late summer to set up liaison offices and provide on-site inspection.