Clifford Chance

New Barriers to Entry: The Department of Commerce's Proposed Rule to Ban Imports of Chinese or Russian "Connected" Vehicles and Parts

September 25, 2024

On Monday, September 23, 2024, the U.S. Department of Commerce's Bureau of Industry and Security published a Notice of Proposed Rulemaking ("NPRM") that seems to counteract a threat previously only visualized in media productions such as Leave the World Behind. This NPRM aims to secure the supply chains of Connected Vehicles from the People's Republic of China ("PRC") and Russia by prohibiting the import or sale of certain connected vehicle systems designed, developed, manufactured, or supplied by entities with a sufficient nexus to the PRC or Russia. The prohibition excludes vehicles not used on public roads such as agricultural and mining vehicles. Connected Vehicles utilize specific pieces of hardware and software that allow for both Vehicle Connectivity Systems and Automated Driving Systems. By virtue of permitting external connectivity, these vehicles are allegedly more vulnerable to malicious operators who can access and collect sensitive data and remotely manipulate cars on American roads. Thus, the Department of Commerce has issued this NPRM to remedy this loophole in domestic security.

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