United States: Commerce Initiates Rulemaking Targeting Foreign-Manufactured Technology Used In Connected Vehicles
By Eric McClafferty , Carolyn (Carrie) Schroll , Terry Frederic and Wyatt Mince, Kelley Drye & Warren LLP
On Thursday, February 29, 2024, the Department of Commerce (“the Department”) announced an advance notice of proposed rulemaking (“ANPRM”), seeking public comments regarding new potential regulations to “secure and safeguard the Information and Communications Technology and Services (“ICTS”) supply chain for connected vehicles (“CVs”).”
The Department is expanding its authority to review transactions relating to communications and telecommunications, after a significant period of relative inactivity. This marks one of the first major uses of this authority to flag items of risk coming into the United States.
The ANPRM outlines the risks of such technology from foreign adversaries used within CVs. The Department determined that ICTS can provide a direct entry point to “sensitive U.S. technology and data,” or that may be able to bypass certain safety and security measures within the CV. Thus, the Department determined that ICTS provided under the jurisdiction or direction of certain foreign countries or persons could be used to harm the United States’ critical infrastructure and national security. In a press release, the Department also named China as a threat in this context.
The Department is seeking feedback on a range of issues, providing an opportunity for industry players to help shape the scope and direction of the Department’s rulemaking process. Although in its very early stages, the ANPRM signifies an unprecedented use of authority under the ICTS Executive Order. Companies should be attentive to these developments, and consider consulting with counsel and submitting questions or concerns to the Department, as requested in the ANPRM.
Companies that manufacture, supply, or are otherwise involved with CVs should strongly consider submitting comments, especially those in the telecommunications industry.
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