BIS Adds 32 to Entity List for Diverting Items to China, Russia, Evading End-Use Checks

The Bureau of Industry and Security last week added 32 entities to the Entity List, most of them based in China, for either circumventing export controls on China, supplying controlled items to Russia, evading BIS end-use checks, supporting China’s military modernization, or other activities that BIS said breached U.S. export rules.

The additions include 23 entities located in China and others based in India, Iran, Singapore, Taiwan, Turkey and the United Arab Emirates, the agency said in a final rule released and effective Sept. 12. They will be subject to license requirements for all items subject to the Export Administration Regulations, and licenses will be reviewed under a presumption of denial or policy of denial.

The rule notably added two China-based companies, GMC Semiconductor Technology (Wuxi) Co., Ltd. and Jicun Semiconductor Technology (Shanghai) Co., Ltd., to the list after BIS said they illegally acquired U.S.-origin semiconductor manufacturing equipment for other parties on the Entity List. Those listed parties include China’s largest chip manufacturer, Semiconductor Manufacturing International Corporation, and a SMIC affiliate: SMIC Northern Integrated Circuit Manufacturing (Beijing) Co., Ltd.

Other companies were added for diverting U.S. export controlled items to support China’s military and “defense-related space-domain activities” along with its quantum technology capabilities; participating in China’s “advanced computing and integrated circuit manufacturing and distribution sectors"; directly supplying the Chinese military, government, and security apparatus; and other similar activities.

Others have supplied technology to Russian military end users or are involved in “concealing shipments” to Russia of items listed in Tier 2 of the BIS Common High Priority Items List. BIS also added several companies for either evading end-use checks or for their “dilatory, evasive, or misleading behavior regarding the importation of U.S.-origin items that effectively prevented end-use checks” from occurring or rendered those checks “inaccurate.”

One entity, Iran- and UAE-based Smart Mail Services, was added for being a “facilitator” of the illegal transshipment network run by Hossein Hatefi Ardakani, who was sanctioned by the Treasury Department 2023 for his ties to Iran’s unmanned drone program (see 2312190069).

BIS also said Turkey-based Atempo Proje Taahhüt Ses ve Görüntü Sistemleri Anonim Şirketi İstanbul Şubesi and EB Teknoloji Sistemleri Anonım Şirketi tried to divert export controlled items to Russia, and both will be subject to the Russia/Belarus-Military End User and Procurement Foreign Direct Product Rule.

The rule also revises an existing Entity List entry to remove certain Russian addresses and corrects “typographical errors” in the alias, address, license requirements, Federal Register citation, or punctuation for 27 entities based in Belarus, China, Iran, Pakistan, Russia and Turkey.

All exports that now require a license as a result of this rule but were aboard a carrier to a port as of Sept. 12 may proceed to their destinations under the previous eligibility as long as the items are exported before Oct. 14, BIS said.