BIS Working 'Day-In and Day-Out' on Finalizing China Chip Controls, Official Says

The Bureau of Industry and Security is working “day-in and day-out” on a final rule that will make tweaks to its China-related chip export controls released in October (see 2210070049), said BIS Senior Export Policy Analyst Sharron Cook. But a public release of the rule isn’t imminent -- the agency hasn’t yet sent the changes to be reviewed by other agencies, said Hillary Hess, regulatory policy director at BIS.

There’s been “a lot of work on it. There's a lot in there,” Hess said during a June 20 Regulations and Procedures Technical Advisory Committee meeting. “We want to address all the comments and we want to make sure that we're accounting for everything.”

Sen. Marco Rubio, R-Fla., last month said BIS is taking too long to finalize the controls, adding that they need to be “strengthened” and “vigorously enforced” to maintain American semiconductor leadership. The agency’s fall 2022 regulatory agenda listed plans to finalize the rule in March (see 2301050012).

Cook said part of the reason BIS hasn’t yet released a final version of the rule is because there have been “just so many people working on it, so many minds put together in deciding what to do and any adjustments we're going to make to these rules.” Although BIS is looking to update the rule, BIS Undersecretary Alan Estevez last year said he didn’t expect any significant revisions (see 2212060059).

Still, the agency is making sure it addresses all public comments it received before publishing the changes, Hess said. Cook also said some of the export license applications submitted under the October rule have been “informative” and, along with the comments, are helping to “inform our process” for making any potential changes. “We did go through those very thoroughly to make decisions on any tweaks we're going to make.”

She also said BIS may address any “workarounds” being used by China to evade the export restrictions and was asked by a TAC member whether the agency will address “China data center providers getting around these rules by renting access to chips they already had on hand.” BIS has previously said it’s looking at ways to stop Chinese companies from skirting the restrictions through certain rental agreements with cloud providers (see 2303210037 and 2305160092).

“BIS is talking and discussing about what to do about this,” Cook said. “So we're aware and we have been discussing solutions inside of BIS.”