BIS Advisory Opinion

The Bureau of Industry and Security recently published its response to an advisory opinion request on whether certain information shared with the International Civil Aviation Organization during aircraft standards development activities would be subject to the Export Administration Regulations. The requester, whose name was redacted, believes that the information contains “non-proprietary system descriptions” and therefore isn’t subject to the EAR.

The Bureau of Industry and Security published its first set of frequently asked questions on its new China-related export controls (see 2210070049), covering the definition of semiconductor “facility” and offering guidance on certain U.S. persons requirements, license review policies and more.

The Bureau of Industry and Security was “overwhelmed” with advisory opinion requests after issuing its 2020 rules creating military end-user regulations and an MEU list (see 2004270027), said Matt Borman, deputy assistant secretary for export administration, speaking during a Sept. 27 defense industry conference hosted by IDEEA. He said the agency was “happy” to help companies that had questions about the rule, but the process was time-consuming. “It took us a while,” Borman said. “But I think we're through that backlog” now.

The Bureau of Industry and Security recently launched a landing page for its export control actions against Russia, including relevant fact sheets and guidance. The page also includes agency contact information for industry, a link to request a formal advisory opinion and a list of related regulations and "legal resources." BIS warned that it has imposed controls on a "range of items" subject to the Export Administration Regulations that didn't "previously require export licenses when destined for Russia" and plans to update the page as more restrictions are announced.

The State Department has crafted new guidelines for preparing defense trade agreements and plans to release them soon, said Catherine Hamilton, licensing director at the Directorate of Defense Trade Controls. She said the agency also plans to make changes to the International Traffic in Arms Regulations to reflect the new document, which would update submission guidelines for Technical Assistance Agreements, Manufacturing License Agreements, and Warehouse and Distribution Agreements.

Although the Commerce and State departments have been able to conduct some export end-use checks during the COVID-19 pandemic, officials said both agencies continue to face challenges scheduling on-site inspections.

Crowell & Moring has seen “mixed results” and some longer response times from the Bureau of Industry and Security for license applications captured by the agency’s military end-use and end-user rule, said Brian McGrath, a trade lawyer with the firm. But overall, McGrath said the agency has been helpful when responding to exporter questions about the rule, which imposed more due-diligence requirements on shipments that could be sent to military end users or used for military end uses in certain countries (see 2102190042).

The Bureau of Industry and Security has faced challenges applying some of its new export control rules during the last year, including its military end-use and end-user regulations and broader semiconductor-related policies toward China, a senior BIS official said. Matt Borman, BIS’s deputy assistant secretary for export administration, said he recognizes the rules may also be causing compliance challenges for industry, and the agency is considering more guidance.

The Bureau of Industry and Security will amend the Export Administration Regulations (EAR) Dec. 23 to add the new military end-user list (see 2012210047), consisting of 103 entities subject to export licensing requirements, the agency said in a Dec. 22 notice. Licenses will be required to export, reexport or transfer certain items described in the EAR that are subject to military end-use (MEU) or end-user licensing requirements. A BIS spokesperson said the 102 cited in the notice is a typo.

The Commerce Department will not publish its long-awaited proposed regulations on routed export transactions (see 2007150044) this year and is experiencing delays on other rules, including another set of export controls from the 2019 Wassenaar Arrangement, a Commerce official said. Hillary Hess, the Bureau of Industry and Security’s regulatory policy director, cited a combination of internal BIS delays and a backlog at the Federal Register for the slowdown.