On January 15, 2025, the U.S. Bureau of Industry and Security (BIS) issued an interim final rule establishing additional export control compliance measures for semiconductor fabricators. The rule aims to enhance oversight of integrated circuits (ICs) by addressing concerns related to the classification and end-use of advanced ICs produced by third-party manufacturers. The regulation took effect on January 16, 2025, with certain compliance obligations beginning on January 31, 2025. A public comment period will remain open until March 14, 2025.
New Due Diligence Requirements
The rule introduces new due diligence obligations for “front-end fabricators” and “outsourced semiconductor assembly and test” (OSAT) companies engaged in the export, re-export, or in-country transfer of advanced ICs. These measures are designed to improve compliance with Export Control Classification Number (ECCN) requirements and prevent circumvention of existing export controls.
Presumption for ECCN 3A090.a Classification
Under the rule, BIS establishes a presumption that certain advanced logic ICs fall under ECCN 3A090.a and are designed or marketed for data center applications unless proven otherwise. This presumption may be overcome if one of the following conditions is met:
- The IC is exported to an “approved” or “authorized” IC designer that attests the chip does not meet the relevant performance threshold.
- The chip is packaged by a front-end fabricator outside of Macau or a Country Group D:5 destination, and the fabricator verifies the transistor count of the final chip.
- The chip is packaged by an “approved” OSAT company that verifies the transistor count of the final chip.
“Approved” and “Authorized” IC Designers and OSATs
The rule introduces a list of “approved” IC designers and OSAT companies deemed to present a low risk of diversion. It also establishes an application process for companies seeking to be added to or removed from these lists.
Additionally, the rule defines “authorized” IC designers as companies that, prior to April 13, 2026, meet the following criteria:
- Headquartered in Taiwan or a U.S. ally listed in Country Groups A:1 or A:5.
- Not located in, nor ultimately owned by, entities in Macau or a Country Group D:5 country.
- Willing to provide required data to front-end fabricators, which must then submit reports to BIS.
After April 13, 2026, companies must also apply for “approved” status to retain “authorized” designation, which remains valid for 180 days following application submission.
Changes to AIA and ACM License Exceptions
The rule modifies the previously introduced AIA and ACM License Exceptions, limiting their applicability to ECCNs 3A090.a, 5A002.z, and 5D992.z.1 if designed by an “approved” or “authorized” IC designer.
Enhanced Due Diligence for Fabricators
The new requirements also introduce additional technical and Know Your Customer (KYC) due diligence measures for front-end fabricators exporting to “authorized” IC designers. These obligations supplement existing compliance measures.
Additions to the Entity List
In a separate action, BIS issued a final rule adding 16 companies to the Entity List. According to BIS, these entities were designated due to their involvement in the development of advanced computing ICs that contribute to China’s advanced weapons systems, weapons of mass destruction, and high-tech surveillance capabilities. The rule also cites concerns about potential risks of diversion to Huawei. The new Entity List designations took effect on January 16, 2025.
The new measures reflect ongoing efforts by BIS to regulate the global semiconductor supply chain and strengthen export control enforcement is seeking public comments on the new rule by May 15, 2025, which may lead to further adjustments before the final implementation of the new controls.
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