US-China Trade Truce: Export Controls and Tariffs in the Second Trump Term

The geopolitical landscape between the United States and China is entering a phase of managed friction, characterized by what former senior diplomat William Klein describes as a truce rather than a definitive peace. For the Legal and RegTech sectors, this distinction is critical. A truce implies that the underlying regulatory architecture—specifically the aggressive use of export controls, entity listings, and Section 301 tariffs—remains in place, even if the pace of new escalations slows. Klein, who served in senior roles at the US embassy in Beijing during the first Trump administration, suggests that the primary objective of upcoming high-level summits will be to prevent the relationship from going off the rails rather than a wholesale dismantling of the trade barriers erected over the last decade.

The Busan summit held on October 30 serves as the current baseline for this relationship. According to Klein, the commitments made there regarding export controls and tariffs are likely to be reaffirmed in any future meeting between President Trump and President Xi. For corporate legal departments, this signals a period of regulatory stasis where compliance with existing restrictions remains the top priority. The expectation of modest outcomes from future visits suggests that the complex web of US Department of Commerce Bureau of Industry and Security (BIS) regulations will not be simplified anytime soon. Instead, the focus will likely shift toward commercial wins, such as Chinese purchase agreements for US agricultural products and commercial aircraft, which serve as traditional diplomatic lubricants without requiring significant changes to the national security-linked regulatory framework.

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The geopolitical landscape between the United States and China is entering a phase of managed friction, characterized by what former senior diplomat William Klein describes as a truce rather than a definitive peace.

The implications for RegTech are particularly pronounced. As the two superpowers attempt to contain the competition, the demand for sophisticated trade compliance software will likely surge. Companies operating in the crosshairs of US-China trade must navigate a landscape where truce conditions can be volatile. The potential for loosening some export controls remains the big question, but Klein notes that stakeholders on both sides remain cautious. This caution suggests that legal teams should prepare for a dual-track reality: one track of public diplomatic engagement and commercial announcements, and a second track of persistent, rigorous enforcement of technology transfer restrictions.