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U.S. cuts export rights of firms that sent 3D blueprints to China

An American flag flies outside the Commerce Department in Washington. (Andrew Harrer/Bloomberg News)

The Commerce Department on Wednesday announced it has frozen the export privileges of three U.S. companies for the illegal export to China of technical drawings used for 3D printing of satellite, rocket and defense-related parts.

The issuance Tuesday of what’s known as a “temporary denial order,” or TDO, means Quicksilver Manufacturing, Rapid Cut and U.S. Prototype, all located in Wilmington, N.C., cannot export anything for 180 days, Commerce Department officials said. They said the investigation is ongoing.

“Outsourcing 3-D printing of space and defense prototypes to China harms U.S. national security,” Matthew S. Axelrod, assistant secretary for export enforcement at the department’s Bureau of Industry and Security, said in a statement. “By sending their customers’ technical drawings and blueprints to China, these companies may have saved a few bucks — but they did so at the collective expense of protecting U.S. military technology.”

Peter Lamporte, CEO of the three companies, declined to comment on Wednesday.

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The material is subject to U.S. export controls because of its sensitivity and importance to national security, officials said. The action marks the first time the Commerce Department has taken such an enforcement action against U.S. companies for sending technical drawings to China.

The use of TDOs has been increasing, with Commerce also issuing them against Russian airlines to punish Moscow for the invasion of Ukraine. These orders are some of the most potent civil actions the agency can issue, officials said. They can be used not only to cut off the right of U.S. companies to export controlled items, which include everything from furniture to military-grade products, but also to bar foreign companies from exporting U.S. items, and to prevent foreign companies from receiving any U.S. components.

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According to the TDO, the firms collectively used the same rental mailbox to receive export-controlled drawings from their domestic customers with requests to 3D-print them. Without their customers’ consent or knowledge, the drawings were sent to manufacturers in China to print, without the required license. The items were then imported into the United States and shipped to the original customers.

The information illegally sent to China included sensitive prototype space and defense technologies, the Commerce Department said. In one case, a U.S. customer in May 2021 hired Rapid Cut to make specially designed parts intended for a rocket platform’s ground support and test equipment, the TDO said.

The Commerce Department urged customers of the three firms to review their records to see whether intellectual property or controlled technologies were provided to the firms.

The Chinese government has long tapped commercial firms to develop cutting-edge technologies that its military needs. This “military-civil fusion” approach has been elevated by Chinese President Xi Jinping to a national strategy.

Alice Crites contributed to this report.

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