The Bureau of Industry and Security officially released the texts of two rules to update its Oct. 7, 2022, China chip controls, including an interim final rule that will update controls on certain semiconductor manufacturing items and another interim final rule that will update restrictions on certain advanced computing items, supercomputer and semiconductor end-uses and make other updates and corrections.
The Bureau of Industry and Security today will release a range of updates to its 2022 China chip rule, including new restrictions on several dozen additional chip tools and related items, updated export control parameters for chips used in artificial intelligence applications, a novel notification requirement for certain “gray-zone” chips that fall just below that updated threshold, a new license requirement for chip exports to companies headquartered in nations subject to a U.S. arms embargo and more. BIS also added 13 Chinese companies to the Entity List, effective Oct. 17, for developing advanced chips in ways BIS said are contrary to U.S. national security.
The Bureau of Industry and Security added 49 entities from China, Estonia, Finland, Germany, India, Turkey, the United Arab Emirates and the U.K. to its Entity List for providing support to Russia’s military or to its defense industrial base. The entities, outlined in a final rule effective Oct. 6, are subject to license requirements for all items subject to the Export Administration Regulations, and licenses will be reviewed under a policy of denial.
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The Bureau of Industry and Security added 28 entities from China, Finland, Germany, Oman, Pakistan, Russia and the United Arab Emirates to the Entity List for various actions "contrary to the national security or foreign policy interests of the United States.” The additions, outlined in a final rule effective Sept. 27, are now covered by license requirements for all items subject to the Export Administration Regulations, which carry varying license application review policies. BIS also modified two existing entries on the Entity List under the destinations of China and Pakistan. and removed an entity from the Military-End User List under the destination of China.
The Biden administration Aug. 9 unveiled its plans for a new outbound investment screening regime, which will restrict U.S. investments in three advanced technology sectors in China and set notification requirements for other sensitive outbound investments. The new screening regime, outlined in an executive order to be signed by President Joe Biden, will prohibit certain investments in entities operating in China’s quantum information technology, artificial intelligence and semiconductor/microelectronics industries, namely those that transfer technological “know-how” to Chinese companies, a senior administration official said during a call with reporters. The prohibitions will take effect after the Treasury Department solicits public comments, writes and finalizes regulations.
The Bureau of Industry and Security added four spyware companies in Greece, Hungary, Ireland and North Macedonia to the Entity List for their role in cyber activities that threaten the “privacy and security of individuals and organizations worldwide.” The additions, outlined in a final rule effective June 18, impose license requirements for all items subject to the Export Administration Regulations. BIS will review license applications under a presumption of denial.
The Bureau of Industry and Security added 43 entities in China, Kenya, Laos, Malaysia, Pakistan, Singapore, South Africa, Thailand, the United Arab Emirates and the U.K. to the Entity List for either supporting China’s military, supporting the government's human rights abuses or supporting Pakistan’s weapons capabilities. The additions, outlined in a final rule effective June 12, impose license requirements for all items subject to the Export Administration Regulations. The agency also removed one entity from the list.
The Bureau of Industry and Security announced a host of new Russia-related export controls, including measures that expand its Russian and Belarusian Industry Sector Sanctions, broaden its foreign direct product rule restrictions and add 71 new entities to the Entity List. Some of the changes, outlined in a 106-page final rule effective May 19, “better align” U.S. export controls with allies, place new export license requirements on additional “industrial items” and chemicals destined to Russia, and impose controls on certain electrical parts destined to Iran for use in unmanned drones. The Entity List changes, also effective May 19, add entities in Armenia, Kyrgyzstan and Russia for either supporting Russia’s military sector, diverting U.S.-controlled items to Russia or preventing a U.S. end-use check.
The Bureau of Industry and Security fined U.S.-based Seagate Technology $300 million for allegedly violating U.S. export controls against Huawei, the “largest standalone administrative penalty in BIS history,” the agency said. The agency fined the company and its branch in Singapore for selling millions of export-controlled hard disk drives to Huawei in violation of BIS’ foreign direct product rule. As part of a settlement agreement, Seagate agreed to a “mandatory multi-year audit requirement,” BIS said, and could face a five-year export denial order if it violates the terms of the agreement. The settlement comes about 18 months after Senate Republicans urged BIS to penalize Seagate for “likely” violating U.S. export controls against Huawei. Seagate said it received a proposed charging letter from BIS in August.