By Karen Freifeld and David Shepardson
Jan 23 (Reuters) – President Donald Trump’s administration has pushed out a Commerce Department official whose office effectively barred nearly all Chinese cars from the U.S. market for national security reasons, according to people familiar with the matter.
Elizabeth “Liz” Cannon has resigned as executive director for Information and Communications Technology and Services, an office created in 2022 to investigate threats to the supply chain from foreign adversaries, the people said.
News of Cannon’s impending departure comes shortly after the department dropped a plan to impose restrictions on Chinese drones despite the risk that U.S. adversaries might remotely access and manipulate the devices, exposing sensitive U.S. data.
The office, which falls under the department’s Bureau of Industry and Security, also has not issued expected restrictions to address concerns about medium and heavy-duty truck imports.
A year ago, under then-President Joe Biden, the office finalized rules that effectively barred Chinese passenger vehicles due to concerns of data collection and manipulation of vehicles connected to navigation systems.
Those rules remain in place and the Trump administration so far has not signaled that it intends to modify them. Trump has said at times that he would welcome a Chinese automaker that wants to build cars on U.S. soil.
“If they want to come in and build a plant and hire you and hire your friends and your neighbors, that’s great, I love that,” Trump said during a speech in Detroit earlier this month. “Let China come in.”
“BIS is committed to using its ICTS authorities to address national security risks from foreign technology,” a spokesperson for the bureau said in a statement Friday. “Recent staffing changes at the ICTS Office will strengthen the Office and ensure that it continues to deliver for the American people.”
Two sources said that, had she not resigned, Cannon would have been reassigned, and that the new administration plans to put a political appointee in the post. Her last day is expected to be February 20, people said.
Actions restricting both imports from and exports to China have been put on hold at the department in the wake of a fragile trade truce struck last year between the world’s two biggest economies.
LATEST OFFICIAL TO LEAVE COMMERCE DEPT UNDER TRUMP
The administration also recently greenlit Nvidia H200 and other advanced AI chip exports to China ahead of a meeting scheduled between Trump and Chinese President Xi Jinping in April.
The Commerce Department said in September it planned to issue rules that could restrict or ban Chinese drones and withdrew the proposal on January 9, months after sending it to the White House for review.
Commerce also said in September it was considering a rule on trucks weighing more than 10,000 pounds from countries like China and other foreign adversaries, after the curbs on passenger vehicles. That rule is currently on hold, sources said.
In 2024, in a first-of-its-kind determination, Cannon’s office barred the sale of antivirus software made by Russia’s Kaspersky Lab in the U.S., finding Russia’s influence over the company was a significant security risk.
“It’s going to be hard to find somebody who can come in and replace the job Liz Cannon was doing,” said Geoffrey Gertz, a senior fellow at the Center for New American Security, a Washington think tank that specializes in national security.
“Even if we are in a period of detente, it’s important to have the expertise to think through the risks and possible actions,” said Gertz. “If not, it’s going to come back to haunt us.”
Cannon is the latest Commerce Department official to leave government under the Trump administration. Kevin Kurland, who held several high-level posts in his 28 years at BIS, left in December. Dan Clutch, former acting director of the Office of Export Enforcement, started at Caterpillar in August. And Matthew Borman, one of the most influential export control officials for decades, joined the Akin Gump law firm after being pushed out last spring.
Cannon came to the Commerce Department from Microsoft in January 2024 after over a decade at the U.S. Department of Justice, where she supervised and prosecuted criminal cases involving export control and sanctions violations, including the 2017 case against Chinese telecommunications equipment firm ZTE, which paid nearly $900 million as part of a guilty plea.
(Reporting by Karen Freifeld, David Shepardson and Bo Erickson; Editing by David Gregorio, Deepa Babington and Mike Colias)
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