BIS Halting Many China-Related Exports, With More to Come, Sources Say
The Bureau of Industry and Security is suspending and revoking existing export licenses for a range of items destined to China, including chip-related design software and civil aviation items, two people familiar with the matter said.
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BIS has sent or is in the process of sending letters to many companies to inform them that their licenses are no longer valid and they must halt shipments, or that they must stop shipping certain items without licenses. The letters, known as is-informed letters, are affecting not just exports of physical items but also deemed export licenses, which companies must obtain before allowing certain foreign nationals to work on sensitive projects on U.S. soil involving export controlled items.
The letters are expected to impact billions of dollars worth of aerospace and aviation items listed in Category 9 of the Commerce Control List, one person said. They will also impact companies that sell electronic design automation software for semiconductors, certain chemicals and machinery, The New York Times and Reuters reported.
BIS is still in the process of sending letters, the people said, adding that the agency has notified some companies that they will soon be receiving a letter. The people said they expect BIS to continue to restrict more types of exports that the Trump administration believes are of strategic importance to China.
A BIS spokesperson didn’t respond to a request for comment.
One trade consultant, who asked not to be named, said several of their clients have been informed by BIS that certain of their China-related export licenses are being suspended. That includes deemed export licenses, the consultant said, meaning a foreign national employee that works under one of those licenses may be forced to move to another project, or they may no longer be able to perform their duties.
“That could have a very detrimental impact if you employ someone and they can’t do their job,” the consultant said. ”I imagine for some, it would mean firing the person.”
Other trade lawyers and consultants reached May 29 said their clients hadn’t yet received is-informed letters, but they’re receiving questions from clients about how the letters could impact existing purchase contracts.
The letters come about three months after BIS first began pausing new export license applications as part of a Trump administration policy review, including of exports to China (see 2502130068, 2502280006, 2502190018, 2503060013 and 2504020051).
A senior BIS official said May 29 that licensing officers haven't been directed to change licensing procedures for items involving China. Many of those licenses are still being held, while others to close U.S. allies and trading partners are being processed.