BIS Updates FDP Rule Guidance
The Bureau of Industry and Security on Oct. 28 updated its guidance on the Foreign-Produced Direct Product Rule to further clarify situations when goods are subject to the FDP rule and require a license. The guidance, which includes a set of frequently asked questions (see 2012210044), now includes new FAQ No. 4 under the "supply chain" subheading, which starts on page four and continues onto page five, a BIS spokesperson said.
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The guidance was first issued last year to provide industry more insight on the “footnote 1” designation on the Entity List, which imposes controls on goods that are the direct product of certain technology or software subject to the Export Administration Regulations (see 2005150058). The rule placed restrictions on transactions wherein U.S. software or technology is the basis for a foreign-made item produced, purchased or incorporated into any item made or ordered by a Huawei affiliate that is designated by footnote 1.