1) Oct 25 -- Export Controls on Semiconductor Manufacturing Items
On October 7, 2022, the Bureau of Industry and Security (BIS) released the interim final rule (IFR) “Implementation of Additional Export Controls: Certain Advanced Computing and Semiconductor Manufacturing Items; Supercomputer and Semiconductor End Use” (October 7 IFR), which amended the Export Administration Regulations (EAR) to implement controls on advanced computing integrated circuits (ICs), computer commodities that contain such ICs, and certain semiconductor manufacturing items. The October 7 IFR also made other EAR changes to ensure appropriate related controls, including on certain “U.S. person” activities.
This IFR addresses comments received in response to only the part of the October 7 IFR that controls semiconductor manufacturing equipment (SME) and amends the EAR to implement SME controls more effectively and to address ongoing national security concerns. This rule is effective November 17, 2023, except for amendatory instruction 5, which is effective January 1, 2026. Comments must be received by BIS no later than December 18, 2023.
On October 7, 2022, BIS released interim final rule (IFR) “Implementation of Additional Export Controls: Certain Advanced Computing and Semiconductor Manufacturing Items; Supercomputer and Semiconductor End Use” (October 7 IFR) and requested public comments on the newly imposed measures. (87 FR 62186, October 13, 2022) BIS imposed these new controls to protect U.S. national security interests by restricting the People's Republic of China (China's) military modernization efforts and degrading its ability to violate human rights. With a calibrated and measured approach, focused on key, force-multiplying technologies, the October 7 IFR accomplished U.S. national security objectives while interfering with commercial trade no more than necessary to accomplish those objectives.
The advanced computing integrated circuits (ICs), semiconductor manufacturing equipment (SME) essential to producing advanced-node ICs, and items used to further supercomputing capacity controlled through the October 7 IFR are critical for the development of weapons of mass destruction (WMD), advanced weapons systems, exascale supercomputing, and artificial intelligence (AI) capabilities, as well as high-tech surveillance applications. The use of such items in development and deployment of advanced weapons systems and advanced AI to support military applications would further U.S. military adversaries' goals of surpassing the United States and its allies in military capability, thereby destabilizing regional and global security status quos. This includes logic integrated circuits needed for future advanced weapon systems and memory needed for high volume and high-performance data storage in such systems. Additionally, AI capabilities, facilitated by supercomputing and built on advanced-node ICs made by SME, lead to improved speed and accuracy of military decision-making, planning, and logistics. They can also be used for cognitive electronic warfare, radar, signals, intelligence, and jamming. These ongoing national security concerns motivated the October 7 IFR and require the controls set forth in this SME IFR.
The October 7 IFR imposed controls on two sets of items and activities. First, the rule established new Export Control Classification Numbers (ECCNs) and controls for certain advanced computing ICs and computer commodities that contain such ICs, as well as end-use and end-user controls related to “supercomputers.” Second, it established a new ECCN and controls for certain SME essential to producing advanced-node ICs, end-use controls related to the “development” and “production” of those advanced ICs, and end-use controls related to the “development” and “production” of SME. BIS later imposed the same controls implemented on China in the October 7 IFR to Macau because of Macau's position as a Special Administrative Region of China and the potential risk of diversion of items subject to the EAR from Macau to China. See “Implementation of Additional Export Controls: Certain Advanced Computing and Semiconductor Manufacturing Items; Supercomputer and Semiconductor End Use Updates to the Controls to Add Macau” (88 FR 2821, January 18, 2023).
In this rule, BIS updates the SME controls through publication of this SME IFR while publishing elsewhere in this issue of the Federal Register a separate IFR, “Implementation of Additional Export Controls: Certain Advanced Computing Items; Supercomputer and Semiconductor End Use; Updates to the Controls and Corrections” (AC/S IFR). Together, these IFRs advance the U.S. national security objectives identified above and discussed more extensively in the chapeau of section C of this rule.
This SME IFR amends the EAR by refining the scope of the October 7 IFR to more effectively achieve national security objectives while responding to public comments about the semiconductor manufacturing and SME controls adopted in the October 7 IFR. This SME IFR . . . .
BIS received 43 responsive public comments in response to the October 7 IFR. This rule summarizes and addresses the comments under 63 topics that were specific to controls related to SMEs and the production of advanced-node ICs. . . . BIS appreciates the many public comments it received and encourages continued engagement and feedback. This SME rule is published as an IFR with a 60-day comment period and 30-day delayed effective date for most changes for the purpose of gathering valuable public input. . . .
FRN:
https://www.federalregister.gov/d/2023-23049 [32 pages]
2) Oct 25 -- Implementation of Additional Export Controls: Certain Advanced Computing Items; Supercomputer and Semiconductor End Use; Updates and Corrections
. . . This Advanced Computing/Supercomputing IFR (AC/S IFR) addresses comments received in response to only the part of the October 7 IFR that controls advanced computing ICs and computer commodities that contain such ICs. This rule also makes other changes to make the controls more effective and less burdensome, including by correcting and clarifying the controls to more effectively achieve the policy objectives identified in the October 7 IFR. . . . This rule is effective November 17, 2023, except for amendatory instruction 11 amending supplement no. 1 to part 736 of the EAR, which is effective from November 17, 2023, to January 1, 2026. Comments must be received by BIS no later than December 18, 2023.
On October 7, 2022, BIS released the interim final rule (IFR) . . . . This IFR was published in the Federal Register on October 13, 2022 (October 7 IFR) (87 FR 62186). BIS imposed these new controls to protect U.S. national security interests by restricting certain exports to China that would advance China's military modernization and surveillance efforts. With a calibrated approach, focused on key, cutting-edge technologies, BIS also sought not to undercut U.S. technology leadership or unduly interfere with commercial trade. As noted in the Export Control Reform Act of 2018 (50 U.S.C. 4801–4852, ECRA), the national security of the United States requires that the United States maintain its leadership in the science, technology, engineering, and manufacturing sectors, including technology that is essential to innovation.
The advanced computing ICs and supercomputing capacity controlled through the October 7 IFR are critical for preventing or limiting the further development of weapons of mass destruction, advanced weapons systems, and high-tech surveillance applications that create national security concerns, including through their use in exascale supercomputing, and artificial intelligence (AI) capabilities. Advanced AI models, trained on advanced computing ICs, can be used to improve the design and use of the items listed above. The PRC seeks to use advanced computing ICs and supercomputing capacity in the development and deployment of these AI models to further its goal of surpassing the military capabilities of the United States and its allies.
The October 7 IFR imposed controls on two sets of items and activities. First, the rule established new Export Control Classification Numbers (ECCNs) and end-use controls on certain advanced computing ICs, computer commodities that contain such ICs, and supercomputers. Second, it established a new ECCN for certain semiconductor manufacturing equipment (SME) and end-use controls related to the “development” and “production” of three types of “advanced-node ICs,” as well as end-use controls on the “development” and “production” of SME.
Today, BIS addresses these two issues separately through publication of this AC/S IFR and a second BIS IFR, “Export Controls on Semiconductor Manufacturing Items” (SME IFR). Together, these IFRs further advance the U.S. national security objectives identified above and further discussed in section C of this rule. This AC/S IFR focuses on the advanced computing controls and related end use provisions of the October 7 IFR and amends the EAR to expand the scope of the October 7 IFR while responding to comments from stakeholders about the advanced computing controls and related end use controls adopted in the October 7 IFR. This AC/S IFR: . . . .
BIS received 43 responsive public comments, covering 78 specific topics, in response to the October 7 IFR. This rule summarizes and addresses comments on the advanced computing provisions, as well as general comments applicable to all aspects of the October 7 IFR that are not otherwise addressed in this SME IFR. BIS appreciates the many public comments it received, and encourages continued engagement and feedback, including comments on the SME and AC/S IFRs which allow for a 60-day comment period and, for most provisions, a 30-day delayed effective date. . . .
FRN:
https://www.federalregister.gov/d/2023-23055 [60 pages]
3) Oct 27 -- On November 6, 2023, Assistant Secretary for Export Administration Thea D. Rozman Kendler will conduct a public briefing on these two interim final rules and one final rule. This announcement provides details on the procedures for participating in the public briefing.
FRN:
https://www.federalregister.gov/d/2023-23810