PRC SenseTime Uses Loophole To Avoid US Sanctions

By Charles Rollet, Published Sep 28, 2021, 08:21pm EDT

SenseTime says US human rights sanctions have no "material adverse impacts" on its business, arguing a legal loophole lets the PRC AI giant obtain sensitive US technology.

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SenseTime was added to the Commerce Department's Entity List in October 2019, which effectively prevents listed entities from obtaining many US tech items.

But thanks to a 2020 US update that singled out "Beijing SenseTime", the firm says it can "continue to source" items as long as it doesn't use its Beijing SenseTime subsidiary.

Prior to the sanctions, SenseTime was widely referred to as "Beijing SenseTime" and most of the firm's key patents and trademarks are still owned by Beijing SenseTime while Beijing has the most SenseTime workers listed on LinkedIn.

However, SenseTime's current ownership chart shows Beijing SenseTime to be an isolated subsidiary. SenseTime's website no longer lists Beijing SenseTime at the footer, but Shanghai SenseTime.

This raises questions about these sanctions' implementation. And while SenseTime is currently benefiting, it also risks that Commerce will add other SenseTime entities later down the line.

IPVM jointly covered this story with Axios which has published its own article.

SenseTime **********

********* ** *** ***'* largest ****** ***********/** **** with **** ***** ** ~$534 *******,****** * ************ ****** ** *** on *** **** **** Stock ********.

********* ********** *** ****** **** in ******* **** (***** with********* *** *****)****"***** ****** ********** *** abuses ** *****’* ******** targeting *******":

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********* ******* '****** ***********' used ** *** ****** to ****** ******* ****** *** **** ********** ************* **** ***** ******** ******* that ** **** ** 2019, ****** ****** *** Entity ****, *** ***** US ****************** ******** ************ *********.

*** ****** **** ***** entities **** ********* ** tech ******** ** ********* ************** ***********/'***'******* * *******, ***** typically ******* ***** '*********** ** ******'.

2020 ****** **** ******

*********** ******* ************* **** ******** "***** Time" *** ***** * Beijing *******:

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*******, ****** ****, *** ** added"******* ***** ****" *** stated **** "***** ****" was ** "*****" ** Beijing *********. **** *** be **** ** ********** ****** ****:

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********* *** **** ******* at *** **** ** a ******* *** ** SenseTime; ** ******* ****, the ******** ********** *** originally ****** ********** "*********", but ** **** **** this *** ******** **** "Hangzhou ********* ******* ********** Co., ***" **** "*********" listed ** ** "*****":

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** ****** *** ***** for *** ** *** changes.

Sanctions "** *** *****", ** "******** ******* *******"

***** ******************* ****** **** **** Beijing ********* ** ********** so *** ********* "** not ***** ** ***** entities ****** *** *****":

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********* **** **** ** why ** *** ******** no "******** ******* *******" as "******** ***** ******** (excluding ******* *********) *** able ** ******** ** source" *** ***** (** long ** **** *** not ************ **** ** Beijing *********):

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***** ********** ********** ****** **** ********* only ***** ** *** specific ****** **********; **** do *** ***** ** "subsidiaries, ****** *********, *** sister *********" **** *** "legally ********" ** **** as ***** *** *** acting ** "******", "******", etc.

********* **** ** *********** "internal ******* ********" ** ensure ******* ********* **** not ********* ********* *****.********* **** '*** *****' has **** ****** ** obtain **** ***** *** to ******* *********'* ******* ("network ******, ******* *********, 3D ******** *** ****** software") *** ***** **** "not ******** ** *** business **********".

********* ******** ** *** firm****** ******* & ******* *** ********* ********.

SenseTime ********

* ********* ************ **** IPVM *** ********* **** apply ** ******* *********, citing "***** ***** ******":

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*. *** ****** **** designation **** ******* ** Beijing *********. ** ***.*, 2020, *** ******* *** Entity **** ** ***** "Beijing ********* ********** *********** Co., ***." *** ** additional *****, "******* ********* Technology *********** **., ***." to *** ****** **** and ******* "*********" ** an ***** ** **** listed ******.

*. ** **** ***** legal ****** **** *** licence *********** ********* ***** the ****** **** ******* to ******* ********* **** and **** *** ***** to *** ***** ******* distinct ********* ********.

Beijing ********* ********

***** ** *** *********, various *** ******* ******** to ********* (*** ******* as * *****) ** "Beijing *********", *.*. ***** ***** ****, * ***** **********************, *** ***-******** ********. ********* ** *********, *********'* **** ******* listed "******* *********" ** the ******:

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*******,*********, *** ******* ***** Shanghai ********* ** *** bottom:

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**** ******* ****** ****** was **** ********, ** some ***** *********** *********** **** **** ****; *** prospectus *** ***** ** August **.

***************** *** ****** **** Beijing ********* **** ****** "sales ** ******** ******** and ********* ** ******* services", *** **** ** its ***** ************. *** th* ********** ***** **** Beijing ********* **** *** majority ** *** ********* trademarks ********** "******** ** our ********":

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*** ********** **** ********* that ******* ********* **** most ** *** ********* patents ********** "********" ** well:

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***** ******** ********* ***** the ******* ****** ** SenseTime ********* *** ***** in *******, ***:

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********* *** *********** ************ outside ** *******, **** its ***** ** *** R&D ** ** ************* ****** ******* ** *&* ****** (**********) ** **********.

**** ***** ********* ***** the ***** - ********* responded ** ** "******** to ******** ***************" ***** the ********** "** ***** reviewed ** **********":

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****** **** ****, ***** the ** *****, ** are ******** ** ******** confidentiality ** *** ******* application ***** ** ** being ******** ** *** regulators. ** ********** **** the ******* ***********, ** have ********* * ***** application ***** ** *** prospectus, ***, ***** *** HK *****, *** ***** prospectus **** ** ************* verified *** ******** ** the **** ** **********. Accordingly, *** ***** ********** should **** * **** source ** *********** ********* the ******* (********* ** the ****** **** ***********) and ** ***** ******* that *** ***** ** it.

** ********* ** *** draft *********** ***** **********, we **** *********** ** export ******* ********** ******* to ****** ********** **** the ******** ** ****** control ****.

Commerce ************** *********

*** ***** ****** *** question ** ******* *** Commerce ********** ********** ******* SenseTime ******** ** *** SenseTime's **** ********* ******/****** HQ.

*** ********* *** *****, the ******** ************************ *****' ****** ***-***** headquarters/parent (**** ***** ******** subsidiaries). **** ***** ** difficult *** *********/***** ** use ***** ************ ** get ****** *** *********, since ***** ************ *** intimately ****** ** *** parent **** **** ******* being ********** "******", "******", etc.

*******, ******* ********* ** not *********** *********'* ******. Structurally, *** ********** ***** Beijing ********* ** ******** from *** ***** ********:

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*** ******** ****** *** the************ * ****** ******* entity, * ******* ******** for *** ***** (*********):

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Commerce ********** ********

**** ***** ******** ******* its ****** ** ** sanction ********* ** * Group, ** *** ******* entity ****. ******** ********* that ********* ** *** Entity **** "*** *** ones **********" ** ******* "US ******** ********/******* ******" and ***** **** "** continually ****** *** **** and **** *********** ** necessary":

*** ********* ** *** Entity **** *** *** ones ********** ** *****/** posing * **** ** being ******** ** ********** contrary ** ** ******** security/foreign ****** ******** ** 744.11, *** *** ***** the ******* *********** ******* unless ***** ****** *** acting ** ****** *** the **** **’** ********** provided. ** *********** ****** the **** *** **** adjustments ** *********. ***** you.

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************ ********* ******* *********'* ********* "was *** ****** ** information ********* ** *** Department ** ******** *** the *** **** ****** Committee":

*** ********** ** ********, with *** *********** ******** continually ******* ********* ***********, including ******* ******* *** receiving ***** ******* ** the ***, ** ****** whether ******* ****** ** added ** *** ****** List. ******* *********’* ********* on *** ****** **** was *** ****** ** information ********* ** *** Department ** ******** *** the *** **** ****** Committee.

Raises ********* ***** **************

*** **** **** ********* openly ****** ***** ********* have *** ** ******** impact ****** ********* ***** their ************* *** *** the ******** ********** - specifically ********* ** ******** *** Security (***), ***** *********** *** Entity **** - **** applied **** ** **** case.

Risk *** *********

** ********* ****** ************ in *************, *** ********* ******** is ** **** ** Commerce/BIS **** ******* ** add ***** ********* ******** to *** ****, ******* this "*** ****** ** significant *************", "********** **************", and "************ ****":

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Comments (7)

John Honovich

IPVM | 09/28/21 08:47pm

*******, **** *********! **** we **** **** ****** **** ***** ** exposing ****.

*** ******* **** * see **** ******* ** the ********* ********** ** a ***** (****** *****) is **** *** ********* of *** ** ********** was ** ******** *** main ********* ******** ** each ***:

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** **** ***, *** the **** **** ***** is ******* ******** **** directly **** ********* *** others **** '******* *********' was *** **** ********* business, * ******* **** SenseTime ** ****** ******* the ********* ** *** US **********'* *******.

**** ** ******* **** Commerce **********'* ***** ********* to **** ** *** Axios ** ****, ** anything, ******** ***** ** do *** **** ********* has ****** **** ** their ********. *********, *****, Hikvision, ***., *** *** do *** **** **** of ********, **** *** re-organize ****** ** ***** and *** ****** *********.

Agree: 3
Disagree: 1
Informative: 2
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Robert Wren Gordon

IPVM | IPVMU Certified | 09/29/21 01:41pm

*** ********* ***** ******** yesterday **** ********* ***** to *** ** **** Kong ** ****-***.

********* ** **** | Financial *****

*********** ***** **** * Stanford ******* ******** ** Charles's ******:

******* ********* ***** **** them ** ** **** forthright ** ********** [****** profiling] . . . but **** ***** **** them ******** ** *****.

Agree: 1
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Charles Rollet

In reply to Robert Wren Gordon | 09/29/21 03:11pm

* ****** ****, ***** quote ******!

Agree: 1
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Undisclosed Integrator #1

10/01/21 10:09pm

**'* ***** ******** **** staffers ******* **** *****'* backs. ****, *'** *** good *** *** ** it's *** **** *** three. **** ***.

****, *****'* ******* ***** with ****** ********. ****** multiple ******* *** ********** to **** *** ********, not *** ***.

*********, **** ***. *********, creative.

** *** ** **** to *** **** ******** profiling ***** **** ** the **. ***** ** LA, *******, *** ****, Phili, *******, *******, *******, Southern ******* (**** ******* elements **** ** ******). Many ***** ****** ****** China *** *** **** attention ** **** ** going ** ** ****. I ***** **** ****** open * *****-***** ******. Get ****** ** *** stories. *** ***** ** the ******** (** ****) with *** ************ ********. Now, *** ******** ** who **** **** ******* staff ****** ********* *** new ***** ********? * have * *** *****.

Agree: 1
Disagree
Informative: 1
Unhelpful
Funny: 2

Undisclosed #2

In reply to Undisclosed Integrator #1 | 10/01/21 10:41pm

*** *** *** *** most ******* ****** ***** Undisclosed... ******* ** ** pretty **** ** **** who *** *** ***** on *********-****** ******** **** you *** **** *** name.

*** ** *** ** your ***** ***** **** you *** ******** ** everyone ** *** ****?

*** ***** **** ** insult, **** ******* *** or *** ** *** hundreds ** ****** **** in *** **** **** dismissively, ** ** *** points *** ****** ** their **** *** *** you ***** ***** *** counterpoints.

*******, *** **** ****** into **** **** ** Alex *****-***** **** ***** something ** ***** **** has ******* ** ** with *** **, ********* that *** *** *****.

Agree
Disagree
Informative
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Funny: 1

Undisclosed #3

IPVMU Certified | In reply to Undisclosed #2 | 10/02/21 05:18am

*** *** *** *** most ******* ****** ***** Undisclosed...

**’* ** *****-**…

Agree
Disagree
Informative
Unhelpful
Funny: 2

Undisclosed Integrator #1

10/02/21 12:15am

**'* ***.

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