Semiconductor IP News and Trends Blog

EDAC’s Export Work Changes Global IP Industry

EDAC Export Committee Chair – Larry Disenhof – discusses Chinese National charges, patent theft, unrestricted technology, and the fate of the global IP market.

My interest was piqued after watching the video about EDAC’s upcoming export seminar – set for September 18, 2013. What follows are additional questions that I asked Larry Disenhof, EDAC Export Committee Chair, concerning the Liu case, the export committee’s hiatus, unrestricted technology, and IP theft. – JB

Blyler: Can you tell me a bit more about Sixing Liu, the US engineer who was caught carrying sensitive company data on his laptop during a flight to China?

Larry Disenhof, EDAC Export Committee Chair

Disenhof: Here’s a good article about the Sixing case. There is a similar case at a company that I pass every day on my commute to the office.

Blyler: Why has it been so long since the last EDA seminar on export control? I believe the last one was in 2007.

Disenhof: A combination of: 1, the fact that we had done very frequent training for about five years and had saturated the target audience; 2, our own individual schedules and day jobs; and 3, the fact that export reform efforts got underway in 2009, but there hadn’t been anything major to report until now. The new regulations will come into effect in a rolling cycle starting in October. Changes to the definition of “military electronics” – the area that directly affects some of our customers (and thus our support of these customers) – will come into effect early next year.

Blyler: Why is it important that EDA maintains its status as “unrestricted technology?” What does “unrestricted technology” mean? What other technologies enjoy this status?

Disenhof: All technology is controlled for export reasons, but most is not heavily restricted. EDA is considered dual-use technology, which is technology that is commercial in nature but can be used in a military setting. There is an overriding restriction which does apply to EDA – namely, we can’t sell to “terrorist” destinations, including countries such as Iran and North Korea, nor to listed prohibited parties. Further, there are a few end-use restrictions – selling to organizations designing missiles or nuclear weapons.

Beyond this, EDA is not restricted. And “restricted” in the dual-use world means no exports to China (PRC), Russia, Vietnam, and about 20 other countries without first obtaining an export license from the government.  The restriction extends to citizens of these countries who are in the US or elsewhere working under a visa status.

As many companies have operations overseas or are hiring foreign nationals, being unrestricted is a big deal. For instance, encryption technology is restricted – however, we received an exemption for how EDA uses encryption for the protection of IP in the design cycle.  Without this exemption that our committee negotiated for and received in 2005, our entire industry would be different today, as much of our software would have required licensing or, at minimum, the need for extra paperwork and reporting responsibilities for any overseas transaction.

In the realm of IP, memories and controllers are unrestricted. But ADCs and DACs above a relatively low threshold are restricted, as are high-speed Ethernet, processors, etc.  Unprogrammed FPGAs are restricted – again, above certain thresholds.

Blyler: How does intellectual-property theft fit into export control?

Disenhof: The thought is that if you take reasonable steps to protect your IP, you won’t be held responsible if pirated copies end up in Iran or North Korea. However, if you are sloppy, you open yourself up to questioning about whether you’re allowing for export violations to occur.