U.S. Removes Sandvine from Trade Restriction List

By Karen Freifeld and David Shepardson

NEW YORK/WASHINGTON (Reuters) – The United States has removed Canada-based Sandvine from a trade restriction list after the networking equipment company made significant changes to its corporate governance and business practices to protect human rights, according to the U.S. Commerce Department on Monday.

Background

The U.S. had initially placed Sandvine on the list in February for supplying the Egyptian government with technology aimed at targeting human rights activists and dissidents.

Sandvine provides deep packet inspection technology, which is utilized for examining and managing network traffic. In February, the State Department stated that Sandvine had supplied tools used for mass web monitoring and censorship, leading to the blocking of news and targeting political actors and human rights activists. This technology was reportedly misused to inject commercial spyware into the devices of critics and dissidents.

Company Response

On Monday, Sandvine stated that its removal from the list "recognizes our commitment to transparency, ethical business practices, and the protection of digital rights," adding that it is transitioning to a model where its technology will only be sold in democratic countries.

In recent months, the company has concentrated on servicing democracies that are committed to human rights. The Commerce Department noted that Sandvine has exited 32 non-democratic countries and is currently in the process of withdrawing from 24 others. Additionally, Sandvine is monitoring the misuse of its technology where it still operates, alongside implementing other reforms.

Implications

Once it was placed on the trade restriction list, Sandvine could not receive U.S. goods and technology without a special license, which was likely to be denied.

Matthew Borman, an official from the Commerce Department, remarked, "Sandvine's delisting is a clear example of how the Entity List may be used to shape corporate behavior in favor of human rights and digital safety."

Other Listings

The department added six Chinese companies to the Entity List, including Beijing Moreget Creative Technology Co for acquiring U.S.-origin items related to aviation simulation technology to support China’s military modernization.

Detail Technology and Shenzhen Jiachuang Weiye Technology were added for attempting to procure U.S.-origin items for Iran's weapons of mass destruction and unmanned aerial vehicle programs. In total, 26 entities were added to the list, including one from Egypt, 16 from Pakistan, and three from the United Arab Emirates. The Pakistani entities were linked to the country’s ballistic missile program, while the Egyptian and UAE entities were added for trying to acquire U.S.-origin parts to circumvent restrictions on Russia following the 2022 invasion of Ukraine.