New advanced computing and chip export controls against China (see 2210070049) represent an “unprecedented degree” of U.S. intervention to preserve technology leadership and could deal a major blow to China’s semiconductor industry, the Center for Strategic and International Studies said in a report last week. But there are several “lingering gaps” in the new policy that the Bureau of Industry and Security should “swiftly” address if it hopes to make the rules as effective as possible, the report said, including adding more companies to the Entity List, making sure the restrictions are adopted by allies and ensuring the agency is properly staffed.

The Commerce Department is close to completing its work on a national export strategy, said Grant Harris, the International Trade Administration's assistant secretary for industry and analysis. Harris said he hopes the administration releases the strategy, which will outline efforts to increase foreign market access for U.S. manufacturers, farmers, carmakers and other industries (see 2104220033), in the “coming months.”

The top Republican on the Senate Banking Committee, Sen. Pat Toomey, R-Pa., said the administration has "a strong case for what they're doing" in restricting U.S. technology that aids the Chinese semiconductor industry (see 2210070049), but he questions how effective it will be unless the Netherlands and Japan go along.

The Bureau of Industry and Security is "undertaking a vigorous outreach effort" to educate companies on the broad China-related export controls announced last week (see 2210070049) and plans to issue guidance soon, a Commerce Department spokesperson said Oct. 12. That guidance will likely take the form of frequently asked questions, the spokesperson said. The agency is also hoping its Oct. 13 public briefing helps answer some industry questions.

The Biden administration wants to improve the effectiveness of multilateral export controls and is building toward the creation of an outbound investment screening regime, the White House said in its national security strategy published this week. Along with a range of domestic and foreign policy issues, the long-awaited strategy outlines the administration’s approach to trade and emerging technologies and its efforts to outcompete in its rivalry with China and continue to sanction Russia.

The Bureau of Industry and Security's new sweeping set of export controls (see 2210070049) will “likely damage” the Chinese semiconductor and advanced computing industries and the U.S. and foreign companies that sell to those sectors, ArentFox said in an Oct. 10 alert. “While that was clearly the point of the new rule, we are expecting total chaos for a while,” the law firm said, adding that there is a “lot to unpack” in the 139-page rule.

The Bureau of Industry and Security added 31 Chinese entities to its Unverified List last week, including Yangtze Memory Technologies Co., a semiconductor firm that U.S. lawmakers for months have urged BIS to add to the more restrictive Entity List. The final rule, which took effect Oct. 7, also removed nine other entities from the UVL and included new guidance on what types of criteria and activities may lead to the transfer of UVL entries to the Entity List.

The Bureau of Industry and Security last week announced a broad set of new export controls it said will restrict China’s ability to acquire advanced computing chips and manufacture advanced semiconductors. The controls, outlined in an interim final rule that will take effect in phases, will impose new restrictions on a range of advanced computing semiconductor chips and semiconductor manufacturing items, impose controls on transactions for supercomputer end-uses and certain integrated circuit end-uses, and introduce new restrictions on transactions involving certain entities on the Entity List.

The Bureau of Industry and Security should add China’s Yangtze Memory Technologies Co. to the Entity List, China Tech Threat, an organization that advocates for stronger export controls on China, said in an Oct. 4 letter to BIS. The letter points to a potential partnership between Apple and YMTC (see 2209220022), which would “put U.S. and other foreign manufacturers out of business” and will allow China’s Ministry of Industry and Information Technology to move closer to “achieving its objective of forcing companies to turn to China as their prime source for advanced technologies.”

The Bureau of Industry and Security added 31 Chinese entities to its Unverified List, including semiconductor firm Yangtze Memory Technologies Co., it said in a final rule effective Oct. 7. BIS said it hasn’t been able to verify the “legitimacy and reliability” of the entities through end-use checks, including their ability to responsibly receive controlled U.S. exports. All export license exceptions involving those parties will be suspended, and exporters must obtain a statement from any party listed on the UVL before proceeding with certain exports.