U.S. House Of Representatives: Review All Chinese LiDAR Companies, Consider The Inclusion Of The Sanctions List

On November 28, local time, the U.S. House of Representatives' U.S.-China Select Committee on Strategic Competition sent a letter to the U.S. Department of Commerce urging the government to conduct an additional review of all Chinese LiDAR (Light Detection and Ranging , or LiDAR) technology firms to determine whether inclusion on three sanctions lists is warranted - the Department of Defense's Chinese Military Industrial Complexes List, the Commerce Department's Entity List, and the Treasury Department's List of Non-SDN Chinese Military Industrial Complexes (CMIC List).

It is reported that a total of 20 members of Congress to sign the letter, and the letter also did not forget to "thoughtful" copied to the Secretary of State Blinken and the Secretary of Energy:
The congressmen argued that LIDAR is not currently subject to U.S. export controls or government procurement, but as a key technology in automated systems and robotics, the U.S. government does not have any national security clearance requirements, and therefore there is a significant so-called "national security risk".
Previously, LiDAR was also included in the Outbound Investment Transparency Act, which was recently attached as an amendment to the Senate's National Defense Authorization Act of 2024, targeting Networked Laser Scanning System, one of the types of LIDAR. LIDAR stands out for its ability to map urban environments, "see through" critical infrastructure, and create realistic scenarios almost like a video game. At the same time, LIDAR can be used in critical military applications.
LIDAR's broad utility makes it a dual-use technology. In the military, LIDAR is used for such purposes as autonomous navigation in unmanned vehicles and drones, and for creating highly accurate 3D maps of the battlefield. The global automotive LiDAR market alone is expected to grow from $300 million to nearly $5 billion by 2028. Needless to say, LiDAR has been widely used in recent years and has excelled in the field of self-driving cars - a field in which China has seen rapid domestic growth and a growing presence as an exporter.
At the moment, a major debate is unfolding in the LIDAR sector about the security risks of whether China dominates the U.S. LIDAR market. U.S. companies claim that Chinese LIDAR poses an imminent security risk, which Chinese companies deny. Earlier this month, China's official media dismissed concerns about self-driving cars and LIDAR data as "another excuse to curb China's technological rise".
Chinese LIDAR manufacturers like WoSai Technology argue that the Chinese government can't access any of the data collected by their automotive LIDAR equipment because it's not connected to the internet, and their equipment can't store a sufficient amount of data to pose a threat.
The Chinese companies named by the GOP lawmakers this time are 1) WoSai Technology, 2) Robosense, and 3) other Chinese companies that have been blacklisted by several U.S. governments have set up their own LiDAR companies, including DJI's Livox Technology and Huawei. Most commercial LiDAR sensors require FPGA semiconductor chips to work. Currently, two U.S. companies, Xilinx Corp. and Altera Corp. control most of the global FPGA market.
Beyond data security concerns, a potentially larger concern is the impact of foreign companies on the dominance of U.S. producers, which could jeopardize the overall viability of U.S. industry. Generous government subsidies allow Chinese firms to ramp up production and flood the market with artificially "cheap" goods, which can put foreign competitors out of business. This well-established model has recently created a furor in the electric vehicle sector.
The inability to procure domestic LiDAR would leave the U.S. dependent on potentially less safe foreign products and products that could ultimately be weaponized or cut off.On December 30, 2022, China listed LiDAR as a restricted item in the "China's Catalogue of Export Prohibition and Restriction of Export Technologies (Public Comment Version). In the restricted exports section, the most notable additions are "vehicle-mounted laser detection and ranging system technology" under LIDAR, and "manufacturing technology for optoelectronic/infrared sensors, synthetic aperture radar, and LIDAR" under key technologies for unmanned aerial vehicle mission payloads. ". While the final version of the document has not yet been released, this action could have a negative impact on self-driving car companies that rely on China-produced LIDAR.
In 2020, China listed LiDAR as a strategic emerging industry, thus increasing the country's investment in the sector. In the automotive LiDAR sector, data shows that China's Hosai Technology maintains a 67% market share in the self-driving cab (self-driving car) market. And in this market, Hosai supplies almost all the U.S. companies in the field.
"Until 2018, the global LiDAR market was dominated by U.S. companies; however, Chinese LiDAR companies are growing rapidly due to the support of China's industrial policies, including tariffs and subsidies," the letter added, noting that Hosai Technology accounted for 47 percent of the global market share by sales revenue. "
The lawmakers called on the U.S. Departments of Commerce, Treasury, and Defense to "investigate China's LiDAR industry to identify entities that should be included on their respective agencies' lists and whether specific U.S. technologies should be subject to controls related to exports to China" - particularly the underlying chips used in LiDAR technology. in particular, the underlying chips used in LIDAR technology, which are not subject to existing restrictions.
The U.S. scrutiny of Chinese technology, particularly LIDAR equipment, underscores the complex global science and technology turmoil at the moment: recently, the U.S. has increased its efforts to stem the flow of U.S. capital and high-tech equipment to China-linked companies, including announcing plans in October to tighten previously imposed restrictions on China's exports of advanced semiconductors. This followed an executive order issued by President Joe Biden in August restricting U.S. investment in China in certain specific technology areas.
The U.S. government has a robust set of national security and trade tools designed to deal with exactly this type of issue. Advanced LIDAR modeling, included in the U.S. Bureau of Industry and Security's (BIS) Export Administration regulations. If hard data shows a real national security threat related to Chinese lidar, the U.S. government can add foreign lidar companies to additional lists, such as the Department of Commerce's list of entities to be blacklisted for procurement. The U.S. government could also exercise the Treasury Department's non-SDN Chinese Military Industrial Complex (CMIC) list and the Department of Defense's list of Chinese military companies.The CMIC list identifies entities sanctioned for their involvement in China's military sector, and the Department of Defense's list identifies Chinese military companies with some operations in the United States. Neither of the two major Chinese LiDAR companies, WoSai Technology and Sutem Polytron, are currently on these lists, and their hard links to the security breach are really hard to prove definitively.