The Bureau of Industry and Security (BIS), a division of the United States Commerce Department, has introduced significant regulatory updates in two Federal Register Notices published on October 25. These updates pertain to interim final rules (IFR) for the export controls on Semiconductor Manufacturing Items (SME IFR) and the Implementation of Additional Export Controls on Certain Advanced Computing Items; Supercomputer and Semiconductor End Use; Updates and Corrections (AC/S IFR). These new rules are in line with the U.S. national security objectives established in the IFR released on October 7, 2022, titled “Implementation of Additional Export Controls: Certain Advanced Computing and Semiconductor Manufacturing Items; Semiconductor End Use; Entity List Modification (Oct. 7 IFR).” Most of the changes introduced by these rules will come into effect on November 17, 2023.
The SME IFR has been introduced to exert controls on additional types of semiconductor manufacturing equipment (SME), including refining and sharpening the restrictions placed on U.S. individuals. Furthermore, the rule extends license requirements for SME by including 21 countries to the list of restricted countries, in addition to China and Macau, where the U.S. maintains an arms embargo (BIS Country Group D:5).
The AC/S IFR maintains the existing licensing requirements for China, including Hong Kong and Macau, which were established in the October 7 IFR. It introduces two categories of updates:
- Adjusting the criteria determining the restrictions on advanced computing chips.
- Implementing new measures to address risks related to the circumvention of the established controls.
Some notable changes brought about by the AC/S IFR include amendments to specific Export Control Classification Numbers (ECCNs), removal of ECCN 3B090, inclusion of a .z paragraph in nine ECCNs, the introduction of a new Temporary General License (TGL), and the creation of a new license exception called Notified Advanced Computing (NAC).
In addition to these changes, the BIS is introducing new requirements for forwarders who file Electronic Export Information (EEI) in the Automated Export System (AES). For any export of items controlled under ECCNs 3A001, 4A003, 4A004, 4A005, 5A002, 5A004, 5A992, 5D002, or 5D992, .z paragraph classification must be specified as the initial text in the Commodity Description field in the EEI filing in AES, alongside other mandatory data for the associated EEI filing. Another significant requirement relates to the commercial invoice, which now applies to 9×515 and “600 Series” ECCNs. The commercial invoice for items classified as 3A090, 4A090, 3A001.z, 4A003.z, 4A004.z, 4A005.z, 5A002.z, 5A004.z, and 5A992.z must display the ECCN for those items.
To provide clarity and address questions related to these updates, Assistant Secretary for the Export Administration, Thea D Rozman Kendler, will conduct a public briefing on the two IFRs and one final rule titled “Entity List Additions,” which was published in the Federal Register on October 19, 2023. The public briefing is scheduled for November 6 from 3 to 5 p.m. Eastern Time. The deadline to submit questions for the public briefing is November 1. The registration link to attend this event will be made available no later than October 30.
