MR. EISNER: It s good to be here with you all. I don t have a. formal presentation. I wanted to create this more as a dialogue, and I will

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1 MR. EISNER: It s good to be here with you all. I don t have a formal presentation. I wanted to create this more as a dialogue, and I will promise to honor my time commitment to about 12 to 13 minutes. As Maria unfortunately said, apparently exports of lawsuits are one of our largest exports. Maybe a case of good news, bad news. The good news is there are no export controls on lawsuits. The bad news is there are no export controls on lawsuits. What I d like to do briefly, as a University Export Control Officer at a research institution that performs fundamental research, namely basic and applied research under the regulations, is to take a step back and to, if you re like I was in many of the previous presentations, not really being a subject matter expert in your areas, I d like to give you a brief overview of export controls just to set a foundation. And, I also want to emphasize that Stanford University does take export controls seriously. Steve underlined, I think very well, why we need to take export controls seriously. In the university setting, the implications are serious, so abiding by export control laws are a formal part of our university policy. Of course, the challenge is to perform basic research across borders with international collaborators by abiding by these complex set of laws. But, what are export controls? They re essentially regulations that address the transfer of technologies, of hardware, of software code that have the

2 potential to adversely affect US National Security. I m addressing US export control laws. How do exports take place in a university setting, which is my world? They can take place through physical shipments; they can take place through transfers whether they re electronic or physical in tangible format through specification sheets, blueprints, and so forth, sharing that information with foreign nationals oversees. But, a lot of us also forget that hand carries are also considered exports under export control regulations. Many of you, like me, know our engineering and science communities love to share the results of their research, put it in a vial, whatever, a pocket, and go on the United Airlines flight to London, to Tanzania, wherever it is. That s actually an export. If it s a tangible item, it s a regulated export. It may require an export license, depending on what s being put in the pocket or put in the suitcase. So, that s sort of a general framework of what exports are, the forms exports can take, how exports can take place and what export controls are. My job at Stanford University, which is a university that has an openness in research policy, which states that we must not accept restrictions on publication dissemination on the results of our work, and that we may not regulate foreign national access to the results of our research. I would say that the vast majority of US institutions of higher learning are institutions that engage in both basic and applied research considered fundamental research under export control regulations.

3 My job is to ensure that the university only performs fundamental research and thereby stays within a safe harbor called a fundamental research exclusion. Some people consider it an exemption, an exclusion, there s a debate about that. But, basically this fundamental research safe harbor states that the results of basic and applied research that are intended for broad dissemination and sharing among the interested scientific community shall be free from regulation, shall be free from export control regulation, shall be free from inhibiting the sharing of research results with our foreign national students, scholars. And for the purposes of this presentation here, the NAS and our international collaborators. The issue is that fundamental research for us is becoming increasingly international. I think we re all seeing that. The Department of Energy even, Federal laboratories, are becoming increasingly international. Stanford operates the SLAC National Accelerator Laboratory on behalf of the Department of Energy. We have students that perform fundamental research at SLAC; however, the Hadron Collider that just opened up in Switzerland at CERN is the recipient of much of the products of Stanford University fundamental research, both in tangible and intangible form. Now, the fundamental research exclusion or safe harbor only regulates information. It does not regulate tangible items. It does regulate the products of research that are components, equipment, materials that we create in the course of our conducting fundamental research. So, that creates an issue I ll touch upon in a second.

4 I m not going to get into trade sanctions and embargos, but I will say that the US regulates items, software code and information with countries that are sanctioned by the US government for economic reasons, namely Iran, Cuba, Sudan, Syria, and North Korea. There are comprehensive embargoes on the first three of those countries. Our students cannot go to Cuba to write term papers if that involves research in Cuba. That is a regulated activity. If they re involved in a dissertation or masters research, they can go as a licensed activity, but right now, it s government policy to not approve licensed applications for graduate students going to Cuba to conduct term papers. And, hardware that goes along with some of the exempted activities with travel to embargoed countries still might require export licenses for those physical shipments even though the activity may not be regulated. So, that s something to keep in mind when attempting to or proposing to engage in international collaborations with the trade-sanctioned countries. So, now that I ve set the tone for what is not regulated under export controls as regards university research, namely fundamental research, for our purposes, what is regulated activity? What is regulated information? And, I think this is key for all of us to understand: what really is bread and butter in the university community is information and sharing information. It is so critical for us to share information across borders, sharing information with our students and scholars, even the United States.

5 So, regulated information is information that is not intended to be broadly shared with the scientific community. But, guess what? During the conduct of our research, we may need to access proprietary or commercial and disclosure restricted information to generate our research results. That s not just true domestically, but it s true internationally, especially if there are third parties involved in the conduct of our research. It could be overseas. It could be a foreign corporation. It could be a non-profit in Latin America that s asking us to sign a non-disclosure agreement to share technical information that they might have from a sponsor. So, NDAs, commercial licensing agreements, procurement agreements, material transfer agreements, which are not uncommon agreements in the course of our research, are subject to restriction and thus may deal with regulated technologies or technical information, or disclosure restricted hardware or software code if it s a software licensing agreement. But, the challenge is that industrial partnerships are increasingly essential to university research. There s an increased focus on applied research. This is at the PI and lab team level. It s PI driven research. Sponsors want results. They want to see tangible results. They want to see how fundamental research can be applied and then commercialized later on and developed. But, in our world, the vast majority of our regulated technologies do not have a military pedigree: they originate in the commercial sector. So, that s a real challenge for us. Our world has changed. Unlike 40 years ago during the Cold War, when most of our technologies had that military pedigree and then

6 filtered into the commercial sector. But, most of the technologies that drive our military these days are coming from the commercial sector, whether they are semiconductors, telecommunications, or laser sensors that morph into infrared and night vision lenses. A couple of examples that are regulated items for national security reasons are acoustic dopplers that are like little pinging devices that can be used for mapping sea beds and ocean tides. Well, a number of my faculty are out in the Gulf of Aqaba, the Red Sea, even the Pacific Ocean using these instruments in their basic research on earth science, on the environment, in civil engineering. Lasers are a basic tool and instrument for fundamental photon science that s taking place. But, we re not developing our own lasers. We re not developing our own acoustic dopplers. It s too labor intensive, it s too resource intensive. What are we going to do? We re going to purchase then from a company that s going to provide us a technical manual that may train us in how to use it, and that activity is regulated activity. Again, why? Because they re not sharing public domain information with us. As long as we stay within public domain activity, as a university or a Federal research institute, and our intent is to publish, our intent is to share with the interested scientific community, that s unregulated activity. So, let me just take a brief moment here to throw out a sort of counterintuitive concept. Exports are not just transnational. Exports can actually take place within the United States. Those transfers of technology to foreign nationals in the United States can be a regulated activity, and it s called a

7 deemed export. Exports are deemed to take place to the home country of that foreign national student or scholar at our universities. So, a deemed export, think of it this way. The paradigm shift is this. They re essentially international collaborations that are not transnational; they re actually taking place on a university campus in the United States. I mean, we have our own international collaboration. If I have a foreign national post-doc, and I m a PI, and I m sharing information with that individual, in a sense that s an international collaboration that s going on. It doesn t have to be transnational. So, I beg you to think of, in sort of a broader sense go outside the box, and think of international collaborations as also activities with our foreign national community that take place at our universities. I like the concept of an intellectual diaspora that we heard earlier this morning. Our leaders that are trained in US institutions are part of that intellectual diaspora at some point because many of them go back to their home countries and become leaders of their communities. Rafic is one example. I read his bio. He was trained at North Carolina State in Electrical Engineering, and now he s essentially driving science and technology policy in Abu Dhabi. Our relationships with our foreign nationals in our universities and our research institutions, Federal research institutions like NIH, NSF, what have you, it s really key. Relationships are all about intellectual activity within the scientific community. We ve heard that, presentation after presentation, today. Our relationships with our foreign nationals and our research institutions in the

8 United States are critical in how they are going to perceive us once they leave our institutions. In industry partnerships, and the sharing of corporate IP in university research are, more and more, being encouraged on the Federal level, as I just mentioned, and that creates that difficulty within our universities to share the information we need to share in many of our sponsored research projects. Some barriers to international research collaboration are the following: the extraterritorial reach of US law, as I mentioned, can offend our foreign partners overseas, our foreign students here, and retard short-term and long-term relationships, and these relationships are critical. I m not going to talk in depth about the ITAR which is a complex set of regulations that Steve addressed, but in the space science area, Stanford does a lot of space science; that is regulated as a munitions activity, but it s outside of the fundamental research scope at US universities. That creates difficulties for US universities engaged in fundamental space science research. So, if we re developing prototypes for scientific instruments, and we want to share the results of our work in that area with foreign national collaborators there, it s such a tightly regulated area that, outside of the NATO countries, essentially everything is regulated once it leaves the United States. There are some exemptions for working with that information domestically, but once it leaves the US, sharing that information at conferences outside the United States to certain foreign nationals is a regulated activity, and that creates

9 difficulty when we re engaged in an international research workshop in space science. And, if we elaborate and go beyond what s actually been published in the literature and the results of our work, that could be a defense service. That could be seen as technical assistance. So, essentially we end up with no Q&A in the space science area outside of NATO countries because if we go beyond what s been published and somebody asks, well how did you do that, you know, can you go into the heat tolerances of that thing? There may be a rationalization for that, on some National Security level, but we also can t talk about our science and go beyond what s already in the papers. Essentially, here s the paper, go ahead. Penultimately, many of our export controls are unilateral, and that s creating a huge burden in the United States. I personally would like to see 90 percent of our unilateral, if not all of our unilateral, export controls eliminated under the current export control reform. I don t think they make sense for the United States. The same technologies can be found for these low-level technologies outside the United States, whether it s Europe, China. And some of the design software is critical for our students to design software chips, and it s difficult for them to engage in that area. So finally, in Beyond Fortress America a publication that came out sponsored by the NAS last year, the thesis is that there s an inextricable link between national security and economic security. We see that foreign national

10 graduates hired by US companies, coming out of US institutions, are critical to the US economic base. We want to hire the best and the brightest. They create new jobs, intellectual property that they create increases tax revenue, and we now have a foreign policy focused on promoting exports. Foreign economic development creates jobs in manufacturing and service industries, generates wealth for the US, and the global standard of living rises. We want to regulate only those technologies that really are absolutely critical to the US It will also be a source of funding for US academic research which will offset our current decline in federally funded research if our foreign nationals are able to productively contribute to basic research in the United States without regulation. Thank you.

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