New BIS Rule: Key Points and Implications for Advanced Technology Controls

The Bureau of Industry and Security (BIS) has issued a rule that adds new export controls to a number of cutting-edge technology, including semiconductors, quantum computing, and additive manufacturing. These controls are intended to address national security and foreign policy concerns, ensuring that the United States maintains competitiveness in advanced technology domains while protecting sensitive innovations from adversaries. The rule is part of a larger attempt to harmonize US export controls with overseas partners that have similar technical constraints in place.

This rule makes numerous significant changes to the Commerce Control List (CCL), establishing new Export Control Classification Numbers (ECCNs) and amending old ones. These additions include controllers for semiconductors, quantum technologies, and additive manufacturing equipment. For example, cryogenic cooling systems, which are critical for quantum computing, are now subject to regulation due to their strategic importance in scaling up quantum computers. This move reflects the growing interest in quantum technologies, which have far-reaching ramifications for both commercial applications and national security.

One of the most significant components of this rule is the creation of a new framework for implementing export controls (IEC). IEC goods fall under the 900 series of ECCNs and are subject to global licensing rules. These goods are especially sensitive because of their possible military applications and the dangers they pose if transferred to unauthorized parties. The rule also includes a new License Exception IEC, which permits specific exports and reexports to countries that have established analogous measures. This ensures that US companies can continue to collaborate with international partners while following tight export laws.

In addition to these new regulations, the BIS rule imposes regional stability and anti-terrorism measures on a wide range of commodities. Semiconductor manufacturing equipment, including isotropic and anisotropic dry etching tools, is increasingly regulated due to its relevance in the production of sophisticated integrated circuits. These circuits are essential to a wide range of technologies, from consumer electronics to military systems, therefore their control is crucial to national security. Furthermore, export controls are currently in place for quantum computing-related technology such as parametric signal amplifiers and CMOS integrated circuits, due to their potential to increase computational capacity and use in sensitive applications.

The rule also tackles the issue of deemed exports and reexports, which is particularly relevant for quantum technology. Deemed exports are the release of controlled technology to foreign nationals within the United States, whereas reexports include the transfer of technology to another country. The BIS has issued a new General License that permits deemed exports of quantum technology to foreign citizens from particular nations as long as they meet certain requirements. This strategy strikes a balance between the necessity for foreign collaboration in quantum research and the imperative to secure US technology from potential exploitation.

This law poses both obstacles and opportunities for enterprises in the United States that develop and manufacture innovative technologies. On the one hand, the increased controls require enterprises to create more extensive compliance programs to guarantee they do not unwittingly violate export regulations. This may necessitate additional expenditures, such as recruiting compliance specialists and improving internal systems to track the flow of controlled commodities. On the other hand, the regulation establishes a more defined structure for working with overseas partners, particularly those in nations that have linked their export controls with those of the United States.

The repercussions of this rule go beyond the immediate issues about compliance. By strengthening export prohibitions on innovative technologies, the United States demonstrates its commitment to maintaining its leadership in crucial industries like quantum computing and semiconductor manufacturing. These technologies are projected to play a significant role in creating the future global economy, and the United States intends to preserve its innovations from falling into the hands of adversaries. At the same time, the regulation recognizes the value of international cooperation, particularly with trustworthy partners who share the United States' commitment to protecting sensitive technologies.

One important aspect of the BIS regulation is its emphasis on retaining US technological superiority while allowing for collaboration with overseas partners. The rule includes procedures, such as the License Exception IEC, that allow US corporations to continue doing business with foreign entities who have established equivalent controls. This approach reflects the reality that many breakthrough technologies, particularly those involving quantum computing, are created through global collaboration. By allowing restricted exports to trustworthy partners, the United States can continue to benefit from global experience while safeguarding its most sensitive technologies.