BIS Issues New Advanted Tech Controls, Including for Quantum, Chips

BIS said the rule will align U.S. export controls with restrictions already announced or implemented by “several like-minded countries,” and it expects more countries to put in place “similar controls soon.” Countries that have announced controls include Canada, Italy, Spain, France and the Netherlands (see 240620004 and 2407030048).

The announcement comes as member states of the Wassenaar Arrangement -- the multilateral export control regime for dual use technologies -- struggle to advance certain export control proposals because Russia remains a member with veto power (see 2405300063).

“Today’s action ensures our national export controls keep step with rapidly evolving technologies and are more effective when we work in concert with international partners,” said BIS Undersecretary Alan Estevez. “Aligning our controls on quantum and other advanced technologies makes it significantly more difficult for our adversaries to develop and deploy these technologies in ways that threaten our collective security.”

Thea Kendler, assistant secretary for export administration, said the new measures “demonstrate our flexibility in how we craft such controls” to bolster U.S. national security. “Not only are we adopting new emerging technology controls with this rule,” she said, “we are also building increased agility into our system with a new license exception for trusted partners.”

The rule takes effect Sept. 6, although exporters, reexporters and transferors of quantum items destined to nations in Country Group A:1 don’t have to comply with certain license requirements until Nov. 5. BIS said it included this 60-day delayed effective date to allow companies time to submit license applications to BIS and to update their internal compliance procedures.

Public comments on the rule are due Nov. 5.

BIS said the restrictions will place “worldwide export controls” on:

• Quantum computing items, including quantum computers, related equipment, components, materials, software, and technology that can be used to develop and maintain quantum computers
• Advanced semiconductor manufacturing equipment, including tools and machines that are “essential for the production” of advanced chip devices
• Gate All-Around Field-Effect Transistor (GAAFET) technology, including technology that produces or develops high-performance computing chips that can be used in supercomputers
• Additive manufacturing, or 3D printing, items, including equipment, components and related technology and software designed to produce metal or metal alloy components.

New License Exception Implemented Export Controls (IEC) will allow exporters to ship these items to certain countries -- without a license -- if those countries have “equivalent national controls” on the same items. BIS published a table that lists which countries are eligible for this exception.

The agency is creating a new “framework” in the Export Administration Regulations to control these technologies, which it’s calling IEC items. Those IEC items will be identified in the 900 series of the Commerce Control List, BIS said, adding that they will be identified by Export Control Classification Numbers where the third digit is a “9” and the fourth digit is a “number from 0 to 7,” such as 3A901. For other items, BIS said it will revise existing ECCNs because it “would have been more confusing to the public to create a separate ECCN.”

The new framework will help exporters distinguish between IEC items and items controlled under formal multilateral regimes, BIS said. “Such items have worldwide license requirements and more limited license exception availability as compared to the ECCNs implementing multilateral regime controls.” License review policies will range from a presumption of approval to a case-by-case review to a presumption of denial.

BIS said the rule also includes a “limited number” of deemed export requirements, which place license restrictions on certain transfers that take place on U.S. soil. The agency said those rules will apply to certain quantum computers, materials, and related electronic assemblies; aerospace technology; and integrated circuit “development” or “production.” The rule also outlines certain “exclusion clauses” for those deemed exports, which BIS said will help “avoid disrupting the ongoing research and development of these critical and emerging technologies.”

The rule also includes a new general license, which authorizes certain exports but subjects them to annual reporting requirements. This will give the agency “necessary visibility and oversight for national security reasons,” BIS said.

The rule also notably includes deemed export control “grandfathering clauses” that will allow certain foreign person employees and contractors to continue to access certain controlled “technology” and “software” that require a license for national security or regional stability reasons if those employees or contractors already have access to that technology and software and are “employed by an entity as of” Sept. 6.

One exception to this grandfathering clause is for certain GAAFET technology controlled under ECCN 3E905 if the foreign person was most recently a citizen or permanent resident of a nation in Country Group D:1 or D:5. Employees or contractors may be able to overcome this exception and access this GAAFET technology under a new general license introduced in the rule, BIS said, “subject to reporting requirements and conditions.”

The 133-page rule describes other specific license requirements, exceptions and exclusions, including for quantum-related deemed export controls.

The agency is asking for feedback on its new framework for IEC items, “especially as it may impact supply chains and compliance programs,” along with the “scope and clarity” of the new ECCNs. It also wants public comments on the scope of the license exceptions and the “potential impacts” caused by the new deemed export control requirements, especially for quantum items.

The agency is asking whether companies have the "necessary" trained staff to “manage deemed export controls for these items,” how many licenses they would need “if deemed export controls were implemented” and how that would impact research and development efforts. It also asked whether companies are developing quantum items "as part of basic scientific research for which deemed exports would be potentially relevant," and whether this is "true for research that is intended for open publication, research for which details will be kept restricted or proprietary, or both."