BIS 50% Beneficiary Rule Suspended

On November 12, 2025, the Department of Commerce, Bureau of Industry and Security, published a rule (90 FR 50857) suspending the previously announced “50% Rule” for the Entity List and Military End User (MEU) List.

Originally scheduled to take effect with the expiration of a General License on November 28, 2025, the rule is now suspended for a year – through November 9, 2026.  Given the importance of this rule, companies should continue to work on implementing additional screening and due diligence measures on exporters and suppliers.  Keep in mind that restrictions also apply to unlisted parties worldwide and you don’t want to be caught short.  Contact us if you want a demo of ECScreening software.

USXports Tracking

The ELISA website that previously provided tracking for pending ITAR applications has been replaced with usxports.gov.  The new site is intended to provide a unified case search for applications submitted through DDTC’s DECCS and BIS’s SNAP-R licensing systems.  ELISA has been decommissioned, while BIS’s STELA (System for Tracking Export License Applications) remains online.

Cambodia Removed from ITAR § 126.1

Following our previous report that Cambodia would be removed from the ITAR 126.1 list of prohibited destinations, the Department of State, Directorate of Defense Trade Controls (DDTC) published a rule (90 FR 50489, November 7, 2025) officially making that change.

As stated in the rule:

As a result of this change, requests for authorization for transfers of defense articles and defense services to Cambodia will be adjudicated on a case-by-case basis and exemptions that are unavailable for transfers to countries listed in ITAR § 126.1 are now available for transfers to Cambodia, subject to the relevant criteria in the exemption being satisfied.

 Tri-Seal Advisory: Sanctions and Export Controls Relief for Syria

On November 10, 2025, the Department of State, Department of Commerce, and the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued a Tri-Seal Advisory: Sanctions and Export Controls Relief for Syria.  The advisory provides an overview of what business is currently permissible with Syria as well as what sanctions and other restrictions remain in place.  While some sanctions on specific persons and entities remain in place, Syria is no longer subject to comprehensive sanctions.  Many civilian items (EAR99) may generally be exported without a license, but most Commerce Control List (CCL) items require a license.  The advisory (pdf) contains additional detail on the current restrictions and opportunities.

On October 27, 2025, the Department of State, Directorate of Defense Trade Controls (DDTC) announced that the United States has removed the arms embargo on Cambodia.  DDTC is now reviewing license applications for ITAR-controlled activities on a case-by-case basis for Cambodia.

An official revision to the ITAR § 126.1 list of proscribed destinations is expected, but has not yet been published.  Until then, Cambodia should continue to be treated as a prohibited destination for all relevant purposes, but licenses should be more likely to be approved.

EAR military end user restrictions on Cambodia also remain in effect.  BIS has not yet made a parallel announcement, likely due to the ongoing government shutdown.

This action follows presidential negotiations in Malaysia.  The White House has released a fact sheet on those developments.

BIS Issues 50% Rule for Entity List

On September 30, 2025, the Department of Commerce, Bureau of Industry and Security, published a rule (90 FR 47201) establishing a “50% Rule” for the Entity List and Military End User (MEU) List.

The new rule extends Entity List restrictions to other entities (e.g., subsidiaries or joint ventures) owned or controlled by entities identified on the Entity List.  It also applies to entities on the Military End User (MEU) List and Specially Designated Nationals (SDNs) under EAR § 744.8.

As we noted back in July, the change is intended to make it more difficult for sanctioned entities to route shipments through related, but unlisted entities.  The new rule imposes additional screening and due diligence responsibilities on exporters as restrictions also apply to unlisted parties worldwide.

The new rule was effective September 29, 2025, but with a Temporary General License (TGL) which essentially delays the rule until November 28, 2025.  Comments were also requested through October 29, 2025.

Our ECScreening service has been anticipating the BIS expansion of end user controls and will be offering an ownership search function to the ECScreening tool that will be deployed before the 60 day grace period expires.

Government Shutdown Update

The Department of State, Directorate of Defense Trade Controls (DDTC) initially switched the DECCS system for electronic licensing to read only mode.  DDTC has since resumed limited operations, including registration renewals and licensing.

DDTC previously stated that submissions may be reviewed if they are:

necessary to respond to emergencies involving the safety of human life or the protection of property, and those necessary for activities essential to national security, including the conduct of foreign affairs essential to national security

These submissions may be flagged for review by:

emailing DDTCCustomerService@state.gov to create a support case. The subject line of your request MUST read “Request for Emergency Submission,” and the message must include the relevant case number (if already pending with DDTC), applicant name and registration code, end-use/end-user (for licenses and agreements), and justification for needing an emergency license. DDTC will contact the requestor with guidance on how to proceed.

The Department of Commerce’s SNAP-R system for electronic licensing remains available, with a procedure available for applications “urgently required to protect U.S. national security and the safety of life and property (for example, exports in support of U.S. military operations and those of our allies and partners around the world).”

To request expedited processing of your application, please note in the “Additional Information” block that priority processing is requested during a lapse in appropriations and include a brief justification for priority processing. You should also send an email to EmergencyLicense@bis.doc.gov for both new license submissions, as well as licenses previously submitted, with a justification for priority processing, noting any nexus to urgent U.S. national security priorities or the safety of life and property.

Although rules (such as the extension of Cyprus policy and reversal of the BIS firearms licensing policy, detailed below) have taken effect since the shutdown began, the eCFR has not been updated.  As their website notes:

The National Archives and Records Administration is closed to normal operations due to a lack of appropriations. eCFR.gov will not be updated until we resume normal operations.

The Federal Register continues to publish notices with a note that publication will continue, but technical support will not be provided.

ITAR Updates – Cyprus

Cyprus remains in the unique situation of being found in the ITAR § 126.1 list of proscribed destinations, but with an annually suspended status.   Under 90 FR 43388  (September 9, 2025), the Republic of Cyprus’ status as a proscribed destination is suspended from October 1, 2025, through September 30, 2026 (Fiscal Year 2026).

EAR Updates – Firearms Policy

On September 30, 2025, BIS published a rule (90 FR 47170) rescinding most of the firearms policy which had been published in a 2024 Interim Final Rule.  The new rule maintains 2024 revisions to firearms ECCNs while otherwise returning to the previous license requirements and review policies.

Of note, the list of High-Risk Destinations for Firearms and Related Items in Supplement No. 3 to part 742 has been removed and reserved.  License applications seeking to export or reexport firearms and related items to non-government end users in these destinations had been subject to a presumption of denial.

For additional background, BIS also published a press release on this action.

BIS Expected to Issue 50% Rule for Entity List

The Department of Commerce, Bureau of Industry and Security (BIS) is expected to issue a rule extending Entity List restrictions to other entities (e.g., subsidiaries or joint ventures) owned or controlled by entities identified on the Entity List.

While details are limited prior to publication, the change is expected to cover previously unlisted entities that are owned or controlled (50% or more) by a person on the Entity List.  The change would be intended to make it more difficult for members of the Entity List to route shipments through related, but unlisted entities.  This would impose additional screening and due diligence responsibilities on exporters as restrictions would apply to unlisted parties worldwide.

The Entity List began in 1997 as a Weapons of Mass Destruction (WMD) anti-proliferation effort.  It now includes both individuals and entities involved in “activities that are contrary to the national security or foreign policy interests of the United States.” (EAR §744.11).  Listed entities are subject to license requirements for EAR-controlled items (including EAR99 or other items that would otherwise be shipped No License Required, or NLR), typically with a presumption of denial.

Revisions to ITAR Country Policies: Proscribed Countries, NATO, and Major Non-NATO Allies

On July 7, 2025, the Department of State, Directorate of Defense Trade Controls (DDTC) issued a final rule (90 FR 29720) updating the International Traffic in Arms Regulations (ITAR) country policies and lists.

The first changes were revisions to §126.1 proscribed country policies for the Central African Republic, the Democratic Republic of the Congo, Haiti, Libya, Somalia, South Sudan, and Sudan.  These revisions are based on recent United Nations Security Council resolutions.  No countries were added to or removed from the proscribed country list.

Second, Finland and Sweden were added to the list of NATO member countries and the name of the Czech Republic was updated to Czechia.

Third, the list of Major Non-NATO Allies (MNNA) was updated to add Colombia, Kenya, and Qatar while removing Afghanistan.

Fourth, redundant references to the Russian Federation were removed from §120.54.  When originally published, §120.54 (the ITAR Cloud Rule) excluded data stored or sent from 126.1 countries or Russia.  Russia’s subsequent addition to §126.1 made the reference redundant.

Finally, the text of §126.1(a) was revised for clarity and other minor changes were made.

OFAC Updates Syria Sanctions

Following an Executive Order, the Department of the Treasury, Office of Foreign Assets Control (OFAC) took multiple actions including a General License, Fact Sheet, and FAQs and changed the Syria-related sanctions program to the “Promoting Accountability for Assad and Regional Stabilization Sanctions (PAARSS) program.”

These actions also include revisions and numerous removals from the  Specially Designated Nationals and Blocked Persons List (SDN List) and Sectoral Sanctions Identifications List (SSI List).

For more information, refer to OFAC’s June 30 press release.

While these actions reduce the scale of OFAC’s comprehensive sanctions on Syria, the country remains subject to significant export restrictions under both the ITAR and Export Administration Regulations (EAR).  It is an ITAR §126.1(d)(1) proscribed country subject to a policy of denial and a member of EAR Country Groups D:5 and E:1 subject to comprehensive export restrictions under EAR §746.9.

On May 13, 2025, the Department of Commerce, Bureau of Industry and Security (BIS) announced that it will rescind the January 15, 2025 Artificial Intelligence (AI) Diffusion Rule and issued guidance on export controls for AI chips.

Formal rescission of the AI Diffusion Rule as well as a replacement rule are expected in future Federal Register Notices.

The May 13, 2025 notice informs industry that compliance requirements that were scheduled to take effect on May 15 will not be enforced.

In addition, BIS issued guidance documents on the following related topics:

• The risks of using PRC advanced computing ICs, including specific Huawei Ascend chips.
• The potential consequences of allowing U.S. AI chips to be used for training and inference of Chinese AI models.
• How U.S. companies can protect supply chains against diversion tactics.

The BIS press release includes additional detail and links to the guidance documents, which in turn provide additional detail including risks, red flags, and best practices.

Since our last roundup was followed by a change in administrations, we have seen a flurry of activity, a regulatory freeze, a few reversals and restorations, and some business as usual.  Read on for the notable export-related changes and proposals.

Department of State: DDTC / ITAR

USML Revisions Proposed, Effective September

The Department of State, Directorate of Defense Trade Controls (DDTC) proposed revisions of fourteen USML categories, ranging from minor corrections to developmental exoskeletons and foreign advanced military aircraft.

• 90 FR 5594, published January 17, 2025 & effective September 15, 2025
• Comments accepted through March 18, 2025
• See our previous post for all the details.

Department of Commerce: BIS / EAR & CCL

Implementation of Certain Australia Group Decisions

The Department of Commerce, Bureau of Industry and Security (BIS) amended the Export Administration Regulations (EAR) to implement changes agreed to by Australia Group (AG):

• New controls on automated peptide synthesizers, dipropylamine, and neosaxitoxin
• Revised controls on botulinum toxins, toxic gas monitors, and centrifugal separators
• 89 FR 104408, published & effective December 23, 2024

Unmanned Aircraft Systems

BIS published an advance notice of proposed rulemaking (ANPRM) related to information and communications technology and services (ICTS) transactions integral to unmanned aircraft systems (UAS).

• 90 FR 271, published January 3, 2025
• Comments on 50 specific issues accepted through March 4, 2025
• Press release

Connected Vehicles

BIS published a final rule related to ICTS transactions integral to connected vehicles.

• Prohibits transactions involving Chinese or Russian origin Vehicle Connectivity System (VCS) hardware and software
• 90 FR 5360, published January 16, 2025 & effective March 17, 2025
• Press Release

Biotechnology Laboratory Equipment

BIS published an Interim Final Rule increasing controls on advanced biotechnology tools:

• High-parameter flow cytometers and certain mass spectrometry equipment moved from ECCN 3A999 into new ECCN 3A069, with development and production technology controlled under new ECCN 3E069.

• 90 FR 4612, published & effective January 16, 2025
• Comments accepted through March 17, 2025
• Press Release

Due Diligence Measures for Advanced Computing Integrated Circuits

BIS published an Interim Final Rule providing additional due diligence procedures regarding advanced computing integrated circuits

• 90 FR 5298 published & effective January 16, 2025 (corrected in 90 FR 9604, published February 14, 2025)
• Comments accepted through March 14, 2025
• Press Release

Framework for Artificial Intelligence Diffusion

BIS published an Interim Final Rule relating to Artificial Intelligence (AI) hardware and models.

• Revised controls on advanced computing integrated circuits (ICs)
• New ECCN 4E091 for artificial intelligence (AI) model weights for certain advanced closed-weight dual-use AI models.
• Updates Data Center Validated End User authorization
• Expands and adds new related license exceptions

• 90 FR 4544 published January 15, 2025, effective January 13, 2025
• Comments accepted through May 15,2 025
• Press Release

Export Enforcement 2024 Year in Review

BIS published its annual Year in Review, highlighting enforcement activities, including:

• Indictments, convictions, and civil penalties
• Release of the antiboycott Requester List and additions to the Entity List
• Updates to guidelines, guidance, and best practices
• Webinars and outreach
• Press Release

Sanctions Programs

 ICC Sanctions Return

 Following an Executive Order, the Department of the Treasury, Office of Foreign Assets Control (OFAC) implemented sanctions on the International Criminal Court on February 6, 2025.  Similar sanctions had been in place from 2020-2021.

Cuba Restricted List Rescinded and Reinstated

The State Department’s Cuba Restricted List was rescinded on January 16, but republished and updated on February 6.  Cuba’s status as a State Sponsor of Terrorism was also briefly rescinded and reinstated.

 Civil Monetary Penalties

The Departments of State, Commerce, and Treasury each published their annual inflation adjustments for export-related civil monetary penalties.

 Executive Orders and Memos

America First Trade Policy

This January 20, 2025 memo included, among other directives:

• A review of the United States export control system by the Secretary of State and the Secretary of Commerce including making recommendations
  • how to maintain, obtain, and enhance our Nation’s technological edge;
  • how to identify and eliminate loopholes in existing export controls; and
  • regarding export control enforcement policies and practices, and enforcement mechanisms to incentivize compliance by foreign countries.
• The Secretary of Commerce was also directed to review Office of Information and Communication Technology and Services (ICTS) rulemaking on connected vehicles and consider whether ICTS controls should be expanded to additional connected products.

Unleashing Prosperity Through Deregulation

Executive Order 14192, dated January 31, 2025 (90 FR 9065) establishes a regulatory cap, considering both numbers and cost of regulations.  The impact on export compliance may be limited, however, as “regulations issued with respect to a military, national security, homeland security, foreign affairs, or immigration-related function of the United States” are excluded from the regulatory cap.

As the year winds down, regulatory activity continues.  Most are rules that renew, formalize, or build on earlier actions, plus a small expansion of controls on items destined for Pakistan related to non-proliferation concerns.

Department of State: DDTC / ITAR

Temporary Modification of USML Category VIII(h)(1)

On November 26, 2024, the Department of State, Directorate of Defense Trade Controls (DDTC) issued a final rule (89 FR 93170) which extends the temporary modification of United States Munitions List (USML) Category VIII (aircraft).

VIII(h)(1) currently controls “Parts, components, accessories, and attachments specially designed for the following U.S.-origin aircraft: The B-1B, B-2, B-21, F-15SE, F/A-18 E/F, EA-18G, F-22, F-35, and future variants thereof; or the F-117 or U.S. Government technology demonstrators.”

The temporary modification allows Category VIII(h)(1) to continue to control specially designed parts, components, accessories, and attachments for listed aircraft if also used in the KF-21 aircraft. Without this note, use of a part for one of the listed aircraft on the KF-21 would have released it form ITAR control.

Registration Fee Increase

On December 10, 2024, DDTC issued a final rule (89 FR 99081) which, effective January 9, 2025 will increase registration fees for manufacturers, exporters, and brokers.

Originally proposed in April, the new fee structure will be as follows:

• Tier 1: $3000
  • New registrants and registrants with no authorization approvals
  • Increase from $2250
• Tier 2: $4000
  • Registrants with five or fewer approvals
  • Increase from $2750
  • Previous threshold was ten approvals
• Tier 3: $4000 + $1100 for each approval after the first five
  • Registrants with more than five approvals
  • Increase from $2750 + $250 for each approval after the first ten

Brokering registration fees remain tied to Tier 1, regardless of the number of brokering authorizations submitted or approved.  No additional fee is required for brokers already registered as manufacturers or exporters.  Limited discounts are available.

Department of Commerce: BIS / EAR & CCL

Commerce Increases Controls on Pakistan

On November 26, 2024, the Department of Commerce, Bureau of Industry and Security (BIS) published a rule (89 FR 93164) adding export controls for certain items destined for Pakistan.

Effective immediately, the new rule adds a license requirement for items listed on the Commerce Control List under Export Control Classification Numbers (ECCNs) 1B999, 2A992, 2B999,1 3A992, 3A999, and 6A996, including:

• Particle accelerators
• Certain stainless or alloy pipes and valves
• Certain pumps and welders
• Oscilloscopes
• Chromatographs and spectrometers
• Magnetometers

The primary concern is whether items may be used in nuclear or missile activities, or may be diverted to any of the currently 162 Entity List members located in Pakistan.  Based on these concerns, the availability of license exceptions is also limited.

BIS also issued a press release on the new rule, which also notes the existence of specific Pakistan Due Diligence Guidance on the BIS website.

Advance Computing Foreign Direct Product Rule

On December 5, 2024, BIS issued an interim final rule (89 FR 96790) expanding the Foreign Direct Product (FDP) rules for advanced computing and semiconductor manufacturing items.  Effective December 2, 2024, comments will be accepted through January 31, 2025.

ICTS Supply Chain Rule

On December 6, 2024, BIS issued a final rule (89 FR 96872) on Securing the Information and Communications Technology and Services (ICTS) Supply Chain.  This follows an interim final rule published in 2021 and will be effective February 4, 2025.

The original rule was intended to provide a process to review information and communications technology and services (ICTS) supply chain transactions, “similar to the process by which entities may inform the Committee on Foreign Investment in the United States (CFIUS) of investments in U.S. businesses” and requested comments.  The new rule “responds to public comments on the interim final rule and finalizes the practices guiding review of ICTS Transactions, amending and, in some cases, removing terms or concepts which experience has shown to be unnecessary, inefficient, or ineffective.”

In addition to recent proposals and changes for space-related export controls, here’s a wrap-up of other recent export-related actions.

Department of State: DDTC / ITAR

AUKUS Authorized Users Available         

As required for the new AUKUS Exemption at International Traffic in Arms Regulations (ITAR) § 126.7, the list of “authorized users” in Australia and the United Kingdom is now available in the Department of State, Directorate of Defense Trade Controls (DDTC)’s DECCS.  Currently including 87 entities, the authorized users are approved by their respective governments and the list is subject to change.

Precision Castparts Consent Agreement

DDTC announced a Consent Agreement with Precision Castparts:

Precision Castparts Corp. settled allegations that it violated the International Traffic in Arms Regulations (ITAR) in connection with unauthorized exports of technical data to foreign-person employees from Bhutan, Burundi, El Salvador, Honduras, Mexico, and Peru pertaining to tools (specifically, wax pattern and core dies) and wax patterns consumed in the subsequent production of casting blades used in gas turbine engines.

This is the third Consent Agreement from DDTC this year, following The Boeing Company and RTX Corporation.

Cyprus

Cyprus remains in the unique situation of being found in the ITAR § 126.1 list of proscribed destinations, but with an annually suspended status.   Under 89 FR 79140 (September 27, 2024), the Republic of Cyprus’ status as a proscribed destination is suspended from October 1, 2024, through September 30, 2025.

Department of Commerce: BIS / EAR & CCL

Data Center Validated End User Authorization

The Department of Commerce, Bureau of Industry and Security (BIS) expanded the Validated End User Authorization (VEU) at Export Administration Regulations (EAR) § 748.15 to include data centers.

• 89 FR 80080, published & effective October 2, 2024

Connected Vehicles Supply Chain

Notice of Proposed Rulemaking (NPRM) would “prohibit transactions involving Vehicle Connectivity System (VCS) hardware and covered software designed, developed, manufactured, or supplied by persons owned by, controlled by, or subject to the jurisdiction or direction of the People’s Republic of China, including the Hong Kong Special Administrative Region (PRC), or the Russian Federation (Russia).”

• Part of effort to secure the information and communications technology and services supply chain
• 89 FR 79088, September 26, 2024
• Press release

Implemented Export Controls (IEC)

At EAR § 740.24 License Exception Implemented Export Controls (IEC) authorizes exports, reexports, and transfers (in-country) of eligible items to, among, or within specified destinations.

• Eligible ECCNs and destinations can be found on the BIS website at https://www.bis.gov/iec
• 89 FR 72926, September 6, 2024
• 89 FR 83427, October 16, 2024 (revision)

Best Practices for Financial Institutions

BIS Issues Guidance to Financial Institutions on Best Practices for Compliance with the Export Administration Regulations

• Recommendations include due diligence best practices, red flags, and a real-time screening.
• Press Release, October 9, 2024

Department of Defense

Cybersecurity Maturity Model Certification (CMMC) Program

Under development since 2010, the CMMC Program is intended “to verify contractors have implemented required security measures necessary to safeguard Federal Contract Information (FCI) and Controlled Unclassified Information (CUI).”

• Tiered model based on the type and sensitivity of relevant information.
• Levels include self-assessment, third party assessment, and government assessment.
• Phased implementation, with four phases over three years.

• 89 FR 83092, October 15, 2024
• Effective December 16, 2024

Department of the Treasury: OFAC

 Recordkeeping Requirements Extended to Ten Years

 The Department of the Treasury’s Office of Foreign Assets Control (OFAC) has extended recordkeeping requirements for sanctions-related transactions from five years to ten years to match the related statute of limitations.

• Statute of limitations for civil and criminal violations of the International Emergency Economic Powers Act (IEEPA), and the Trading with the Enemy Act, (TWEA) was extended from five to ten years in April 2024.
• Includes transactions authorized under general or specific licenses after April 24, 2019
• Effective March 12, 2025
• 89 FR 74832, September 13, 2024

Maritime Shipping Industry Sanctions Guidance

OFAC issued scenario-based guidance to the maritime shipping industry.

• Scenarios identifying new or common fact patterns include deceptive shipping practices, Specially Designated Nationals (SDNs) on trade documentation, obscured or complex ownership structures, and mid-voyage notification of sanctions risk.

Press Release, October 31, 2024