The Bureau of Industry and Security Issues Export Controls Further Restricting Advanced Semiconductors to China and Adds 140 Entities to the Entity List

On December 2, 2024, BIS announced two new rules updating the Export Administration Regulations (EAR) with the stated goal of impairing China’s capability to produced advanced-node semiconductors used in artificial intelligence (AI) and advanced computing.

The first rule is an interim final rule (IFR) that adds two new Foreign-Direct Product (FDP) rules to the EAR; adds or modifies controls for certain advanced computing items, supercomputers and semiconductor manufacturing equipment (SME); and adds additional “Red Flags” to BIS’s “Know Your Customer Guidance.” The second is a final rule that adds 140 entities to the Entity List and modifies 14 existing entries, all of which are involved with the development and production of “advanced-node integrated circuits” (advanced-node ICs).

This highly anticipated rule package is a continuation of a series of BIS rules that control exports of advanced computing ICs, computer commodities that contain such ICs and certain semiconductor manufacturing items. This series of rules began in October 2022 with subsequent revisions and additions in October 2023 (Advanced Computing/Supercomputing IFR (AC/S IFR) and Export Controls on Semiconductor Manufacturing Items), and again in April 2024. The most recent IFR continues BIS’s policy of establishing controls on advanced computing items, supercomputing items and SME that are exported, reexported or transferred (in country) to, or within China (including Macau and any other US arms embargoed country designated as D:5 in the EAR). These rules are aimed at delaying China’s development of advanced AI and impairing its development of an indigenous semiconductor industry. BIS assesses these areas pose a substantial risk to US national security.