U.S. Announces More Controls on Quantum Computing and Other Tech

The Commerce Department just announced export controls on quantum computing, advanced semiconductors, and additive manufacturing technologies.

AIP’s FYI posted a summary of the news: “The controls cover key equipment, materials, and software used in quantum computers as well as complete computers that exceed certain performance specifications. The department stopped short of requiring licenses for foreign nationals to work with these technologies in the U.S., instead implementing new disclosure requirements for citizens of certain countries. However, it has reserved the right to add license requirements in the future and is seeking input on what effects they would have.”

“The rule states that insisting on deemed export licenses for all D:1 and D:5 country nationals would be “devastating to the continued progress of future developments in the quantum field.” It instead requires entities that share controlled quantum technology with foreign nationals from these country groups to keep records of what information they release and to whom,” reported FYI.

According to the Commerce Department, “The most effective way to protect our national security is to develop and coordinate our controls alongside like-minded partners, and today’s actions demonstrate our flexibility in how we craft such controls to achieve our national security objective,” said Assistant Secretary of Commerce for Export Administration Thea D. Rozman Kendler, adding “Not only are we adopting new emerging technology controls with this rule, we are also building increased agility into our system with a new license exception for trusted partners.”

“As critical technologies with military applications continue to emerge and evolve, there is an increased need to regulate their movement to ensure these items are not used for purposes contrary to U.S. national security or foreign policy,” said the Commerce Department.

With the IFR, the Bureau of Industry and Security is implementing worldwide export controls on specific types of items, including:

• Quantum Computing—quantum computers and related equipment, components, materials, software, and technology used in the development and maintenance of quantum computers
• Advanced Semiconductor Manufacturing Equipment—tools and machines essential for the production of advanced semiconductor devices
• Gate All-Around Field-Effect Transistor (GAAFET) Technology that produces or develops high-performance computing chips used in supercomputers
• Additive Manufacturing equipment, components, and related technology and software designed to produce metal or metal alloy components

An FYI article by Clare Zhang claims, “The quantum controls on exports to certain allies enter into effect on Nov. 5 while the rest of the new controls went into effect the day of the announcement, Sept. 6. The rule includes a request for public comment specifically on the prospect of adding deemed export license requirements for D:1 and D:5 countries, as well as ideas for ways of addressing national security concerns without using deemed export licenses. BIS will accept comments on the new rule through Nov. 5.”

According to Carl Williams, a quantum technology consultant and former NIST scientist, aligning U.S. controls with international partners is a positive move. Still, the new reporting requirements pose a nontrivial burden for startups and other small quantum companies. It may be difficult for small companies to comply with the reporting requirements.

“There have been several reports by the U.S. government and others that basically show that half of the quantum-enabled technical workforce… are foreigners in the U.S., and the biggest group is from China,” Williams said. If companies want to keep drawing from that labor pool, they must have in-house lawyers or other export control experts, which many small quantum companies do not have, he added.

One has to look at what’s happened so far with controls and conditions imposed by the U.S. A Global Times article, G.T. Voice: “U.S. tech export controls backfire, drive companies into ‘death spiral,” indicates that we may be shooting ourselves in the proverbial foot. Restrictions on technology with China are resulting in increased financial losses for American companies and innovation woes that prevent the U.S. from being able to force allies into further control over China.

California Dems are pushing the Biden administration to freeze fresh restrictions on U.S. technology exports to China, arguing that a further round of controls “could send longstanding U.S. companies into a death spiral,” according to a Reuters report. The Federal Reserve Bank of New York pointed out that U.S. export control measures targeting China have hurt American companies, as they have caused supply chain disruptions, raised operating costs, and reduced U.S. companies’ competitiveness. The losses are not inconsequential. The report claimed that the total market value of all U.S. companies affected by export controls on China has been reduced by an estimated $130 billion.

Controls have not stopped Chinese companies from developing. Instead, they’ve promoted independent innovation in China, helping Chinese companies reduce their dependence on U.S. technology products and enhancing their competitiveness in the global market. In addition, these Chinese companies are government-supported, putting U.S. companies at a disadvantage. Today’s China has strong technological capabilities and can make independent breakthroughs. The control strategy of the U.S., left over from the Cold War era, is bound to fail in the long term.