The US has indicated a significant increase in export control enforcement, cautioning that those breaching dual-use technology restrictions will encounter harsher penalties and heightened scrutiny. David Peters, Assistant Secretary for Export Enforcement at the Bureau of Industry and Security (BIS), emphasized the escalating risks to American technology, stating that adversaries are keen on accessing crucial dual-use technologies to diminish America’s economic and military superiority. Peters highlighted the administration’s commitment to bolstering enforcement actions under President Donald Trump and Commerce Secretary Howard Lutnick, with a proposed 123% funding boost in the 2026 President’s Budget.
The testimony before the House Committee on Foreign Affairs’ South and Central Asia Subcommittee outlined the challenges faced in enforcing export controls despite recent resource enhancements. Peters acknowledged the stretched enforcement capacity and outlined strategies to address the evolving threat landscape, including prioritizing recruitment, advanced analytics, international collaborations, and training programs. Recent enforcement actions were underscored, with mentions of indictments and arrests in Texas and Florida related to smuggling and unlicensed exports of advanced AI chips and GPUs.
Peters also highlighted significant civil penalties imposed in the past year, such as a $95 million penalty against Cadence Design Systems for unlawfully exporting critical technology and a $1.5 million penalty against Exyte Management for failure to prevent transfers to listed entities. Notably, a $252 million settlement with Applied Materials for illegal exports to a company on the Entity List was described as a substantial penalty. Peters issued a stern warning, emphasizing the consequences of non-compliance with the law and stressing the need for stronger penalties under the Export Control Reform Act (ECRA).
While acknowledging the returns from enforcement efforts, Peters expressed concerns about the adequacy of current financial penalties under ECRA, advocating for stronger measures to deter misconduct and ensure compliance. The Bureau of Industry and Security (BIS) oversees the enforcement of US dual-use export control laws, focusing on technologies with both commercial and military applications. Recent years have seen tightened restrictions on advanced semiconductor exports, particularly those related to artificial intelligence and high-performance computing, in response to mounting apprehensions over technology transfers to strategic rivals.
