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)

*******, **** *********! **** 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
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Funny

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

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

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

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

Agree: 1
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Funny

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

Agree: 1
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Funny

**'* ***** ******** **** 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

*** *** *** *** 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
Unhelpful
Funny: 1

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

**’* ** *****-**…

Agree
Disagree
Informative
Unhelpful
Funny: 2

**'* ***.

Agree
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Funny
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