Responding to a request from the House Subcommittee on National Security, the General Accounting Office, the investigative arm of Congress, recently issued a report on the national security concerns of having foreign nationals work with sensitive technologies. This area is regulated by the Department of Commerce, which requires businesses that are involved in certain technologies, and which employ noncitizens, to obtain “deemed” export licenses. The reason for this is that, because a foreign national is becoming familiar with the technology and will, theoretically, return to his or her home country, it is essentially an export.
In this report, the GAO examined the performance of the Commerce Department in granted deemed export licenses during 2001. During that year, 822 out of 825 requests were granted. The Department also screened a random sampling of primarily H-1B visa applications at US consulates, selecting 160 cases for further review. Despite these efforts, the GAO found the Department’s practices lacking in two primary areas. First, by looking only at visa applications made to US consulates, the tens of thousands of applications made to the INS in the US go without any sort of review. According to the GAO, during 2001, there were about 15,000 people from so-called “countries of concern” who began employment involving sensitive technologies. The second issue is that even in the 160 cases the Department said needed further review, the Department lacked a way of determining the ultimate disposition.
Another serious problem found is that the Commerce Department does not pay on site visits to employers with deemed export licenses to ensure that they are abiding by the required conditions. According to the Department, it lacks staff with the required training to determine whether all the conditions are being met, and that even if it did, it would have no way of monitoring technology transfers that occur in low tech ways such as a conversation between two employees. The inability to monitor compliance with conditions is of especial concern to the Department of Defense, which has indicated that it considers such compliance essential in its decisions to sign off on a deemed export license application.
The GAO makes a number of recommendations, including requiring the Commerce Department to evaluate applications filed in the US with the INS that involve sensitive technologies, and the development of a program to monitor compliance with the deemed export license conditions. The Commerce Department said it will work with the INS to find a way to implement the recommendations, and will develop methods of tracking the outcome of cases it has recommended for further scrutiny.
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