Government tightens export controls after report

Government tightens export controls after report
Government tightens export controls after report
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The Ministry of Economic Affairs on Friday said that it has tightened controls on machine tool exports to prevent their use by Russia in its war against Ukraine, after the Washington Post reported that Taiwanese companies had sold US$20 million of equipment that ended up in the hands of Russian arms makers.

The ministry’s response came after the Washington Post reported on Thursday that since January last year, Russian company I Machine Technology has imported more than US$20 million of sophisticated equipment called CNC machine tools. The tools are made in Taiwan, including by a similarly named Taiwanese trading company called I Machine Tools.

The computer-controlled machines are used for complex and precise manufacturing that is critical to many industries, including weapons production, the Washington Post said.

Photo: Liao Chia-ning, Taipei Times

The ministry said the measures it has adopted to prevent reoccurrences included placing I Machine Technology, which is accused of redirecting Taiwanese-made precision equipment to Russian arms makers, on a blacklist last month.

The list has so far banned 1,900 entities from receiving such products from manufacturers, the ministry said.

The ministry also said it has asked Taiwanese manufacturers exporting to countries such as Turkey and the United Arab Emirates, which are considered to have a high risk of reshipping the products, to agree not to redirect shipments to Russia and Belarus.

In addition, the penalty for first-time violations of exporting to Russia has been increased by more than 15 times to NT$1 million (US$32,007), the ministry said.

The Post said that the shipments imported by I Machine Technology probably violated prohibitions Taiwan and the West imposed in January last year on the sale of technology to Russia, in response to the Ukraine war.

I Machine Technology and the Taiwan-based I Machine Tools have denied the accusations, stressing that the shipments involved only spare parts that were not subject to export controls, the report said.

The Post said the ministry had declined to comment on whether the Taiwanese companies identified in its report had violated the export controls, but said in a statement that the Taiwanese government is planning to bar local companies from selling their goods to I Machine Technology out of concern they could be used for weapons production.

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The article is in Norwegian

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