Overview of US Export Control Regulations
The U.S. Government controls exports of sensitive equipment, software and technology as a means to promote our national security interests and foreign policy objectives. Through our export control system, the U.S. government can effectively:
- Provide for national security by limiting access to the most sensitive U.S. technology and weapons
- Promote regional stability
- Take into account human rights considerations
- Prevent proliferation of weapons and technologies, including of weapons of mass destruction, to problem end-users and supporters of international terrorism
- Comply with international commitments, i.e. nonproliferation regimes and UN Security Council sanctions and UNSC resolution 1540
The Variable Interest Entity structure enables Chinese companies to sell US investors shares in Cayman Island shell companies. Investors have no visibility or control over the real companies located in China.
The road to security regulation internationalization was based on the principle that all sellers played by the same rules. The continuing emergence of Chinese state owned enterprises on the American based New York and NASDAQ exchanges is stacking the deck against American companies and intensifying the risks that investors are taking.