BIS Processing Licenses to Ally Countries; Others More 'Challenging,' Official Says
Although the Bureau of Industry and Security recently resumed processing certain license applications that it had paused in early February as part of a broader export control policy review, the agency is still holding applications for a range of items destined to countries outside a group of about 40 U.S. allies and other trading partners, two people with knowledge of the holds said.
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BIS is processing most license applications involving NATO countries and nations in Country Group A:5 of the Export Administration Regulations, the people said, which includes trading partners that generally benefit from favorable licensing treatment under the EAR.
One of the people, a senior BIS official who asked not to be named, said license applications involving destinations outside those countries are a “little bit challenging right now,” specifically mentioning applications involving the Middle East and Africa. Another person, who also requested anonymity, said the license hold is no longer “across the board,” but more sensitive items, like advanced semiconductors to China, don't appear to be moving.
The agency is, however, processing some applications that have a strong likelihood to be denied, the BIS official said, especially if they involve end-users in Country Group D:5, such as China and other nations subject to a U.S. arms embargo, or if they’re in Country Group E, which are nations subject to a general embargo.
The license holds are still “expansive,” but not as expansive as they were when they first began last month, the BIS official said, when the agency was told to “hold everything.”
An agency spokesperson didn't respond to a request for comment.
The holds began during the first week of February and were led by James Rockas, a Trump administration-appointed official who had been acting as BIS undersecretary for most of last month and who was overseeing an export control policy review (see 2502280006). Rockas was removed from his position in late February and is now listed on the agency's website as the BIS deputy undersecretary. Around the same time, multiple industry officials were told BIS began processing certain licenses.
That included license applications for exports of firearms and ammunition. Larry Keane of the National Shooting Sports Foundation said licenses are back to "being processed as usual" for NSSF members, who deal in firearms and ammunition.
Keane said he hasn't received any recent complaints from members about the holds. If there were still holds, he said, "my phone would be ringing off the hook, but it isn’t."
Other industry officials and trade lawyers told Export Compliance Daily this week that the status of the holds is still unclear.
Bailey Reichelt, co-founder of Aegis, a law firm serving the commercial space industry, said BIS hasn’t provided guidance about which applications are being held and which ones aren’t. But she also said one client recently received an approval for a license application involving a 600-series item that had been submitted to BIS after the holds began in early February. Reichelt said that item is destined to a NATO country.
The BIS official, who spoke to Export Compliance Daily this week, said licensing officers and other employees processing applications haven’t been given a specific reason for the holds, including why certain applications are being held and not others. The person also said BIS leadership hasn’t told licensing officers when processing will return to normal.
“It's a lot of wait-and-see,” the official said.
The person added that the holds caused large backlogs from licenses submitted last month. They said they “wouldn't be surprised” if the current backlog numbered in the hundreds or more.
At least one licensing officer, as of this week, had a backlog of more than 40 applications that had been held for about 20 days, the BIS official said. The person added that some BIS licensing officers usually operate with “hardly any” backlog because new applications normally start to get processed within one or two days.
The BIS official acknowledged that licensing officers haven’t given much information to industry about the holds, despite receiving questions.
“If they have specific questions, we can refer them to the people that are doing it, and they can answer it,” the person said, referring to Trump administration-appointed officials.
“It's not really for me to know,” the person added. “Just, hey, let me know when [BIS] can or cannot process these licenses. And so far, [senior leadership has] been pretty good at it. It just seems to be taking a little bit longer than I expected.”