On October 17, 2023, the US Department of Commerce's Bureau of Industry and Security (BIS) released two interim rules: "Implementation of Additional Export Controls: Certain Advanced Computing Items; Supercomputer and Semiconductor End Use; Updates and Corrections" and "Export Controls on Semiconductor Manufacturing Items." BIS also published new additions to its Entity List.

These rules expand BIS' existing controls on semiconductor and supercomputer equipment and technologies for several countries (most notably, China) that were originally implemented on October 7, 2022.1 The changes were intended to address perceived loopholes in the October 2022 regulations through a series of changes designed to adjust relevant control parameters, and to address the risk of circumvention.

These include changes to:

  1. Impose controls on semiconductor manufacturing equipment.
  2. Adjust the parameters that determine whether an advanced computing chip requires a license.
  3. Refine the US person restrictions to ensure US companies cannot provide support to advanced China semiconductor manufacturing.
  4. Establish licensing requirements for exports of semiconductor manufacturing equipment to additional countries beyond China and Macau to 21 other countries for which the US maintains arms embargoes.
  5. Adopt new measures to address risks of circumvention of the controls, including by extending licensing requirements to 40 additional countries that present a heightened risk for diversion to China, as well as to companies headquartered in targeted countries to prevent countries of concern from securing controlled chips through their foreign subsidiaries and branches.

BIS also added to its Entity List two Chinese entities and their subsidiaries (a total of 13 entities), which are involved in the development of advanced computing chips, found to be engaged in activities contrary to US national security and foreign policy interests.

These updated rules are expansive and complex in nature, and should be reviewed carefully based on the facts.

Additional information on these updates can be found in BIS' press release.2


1 https://www.mayerbrown.com/en/perspectives-events/publications/2022/11/sweeping-new-us-semiconductor-related-export-controls-on-china

2 https://www.bis.doc.gov/index.php/documents/about-bis/newsroom/press-releases/3355-2023-10-17-bis-press-release-acs-and-sme-rules-final-js/file

Visit us at mayerbrown.com

Mayer Brown is a global services provider comprising associated legal practices that are separate entities, including Mayer Brown LLP (Illinois, USA), Mayer Brown International LLP (England & Wales), Mayer Brown (a Hong Kong partnership) and Tauil & Chequer Advogados (a Brazilian law partnership) and non-legal service providers, which provide consultancy services (collectively, the "Mayer Brown Practices"). The Mayer Brown Practices are established in various jurisdictions and may be a legal person or a partnership. PK Wong & Nair LLC ("PKWN") is the constituent Singapore law practice of our licensed joint law venture in Singapore, Mayer Brown PK Wong & Nair Pte. Ltd. Details of the individual Mayer Brown Practices and PKWN can be found in the Legal Notices section of our website. "Mayer Brown" and the Mayer Brown logo are the trademarks of Mayer Brown.

© Copyright 2023. The Mayer Brown Practices. All rights reserved.

This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.