AGENCY:
Bureau of Industry and Security, Department of Commerce.
ACTION:
Final rule.
SUMMARY:
The Department of Commerce is amending the Export Administration Regulations (EAR) by adding thirty-six entities to the Entity List. These entities have been determined by the U.S. Government to be acting contrary to the national security or foreign policy interests of the United States and will be listed on the Entity List under the destinations of the People's Republic of China (China) and Japan. This rule also revises three entries on the Entity List under the destination of China. Lastly, as a conforming change to the addition of one entity to the Entity List under the destination of China, this rule removes this entity from the Unverified List (UVL). The entity is being added to the Entity List for reasons not related to the prevention of an end-use check and is removed from the UVL for consistency with the existing policy of not listing an entity on more than one of these lists at the same time.
DATES:
This rule is effective December 16, 2022.
FOR FURTHER INFORMATION CONTACT:
For questions about the Entity List, contact: Chair, End-User Review Committee, Office of the Assistant Secretary for Export Administration, Bureau of Industry and Security, Department of Commerce, Phone: (202) 482-5991, Email: ERC@bis.doc.gov; and for questions about the UVL, contact Linda Minsker, Director, Office of Enforcement Analysis, Phone: (202) 482-4255, Email: UVLRequest@bis.doc.gov.
SUPPLEMENTARY INFORMATION:
Background
The Entity List (supplement no. 4 to part 744 of the EAR (15 CFR parts 730-774)) identifies entities for which there is reasonable cause to believe, based on specific and articulable facts, that the entities have been involved, are involved, or pose a significant risk of being or becoming involved in activities contrary to the national security or foreign policy interests of the United States, pursuant to § 744.11(b). The EAR impose additional license requirements on, and limit the availability of, most license exceptions for exports, reexports, and transfers (in-country) when a listed entity is a party to the transaction. The license review policy for each listed entity is identified in the “License Review Policy” column on the Entity List, and the impact on the availability of license exceptions is described in the relevant Federal Register document that added the entity to the Entity List. The Bureau of Industry and Security (BIS) places entities on the Entity List pursuant to part 744 (Control Policy: End-User and End-Use Based) and part 746 (Embargoes and Other Special Controls) of the EAR.
The End-User Review Committee (ERC), composed of representatives of the Departments of Commerce (Chair), State, Defense, Energy and, where appropriate, the Treasury, makes all decisions regarding additions to, removals from, or other modifications to the Entity List. The ERC makes all decisions to add an entry to the Entity List by majority vote and makes all decisions to remove or modify an entry by unanimous vote.
Entity List Decisions
Additions to the Entity List
The ERC determined to add Anhui Cambricon Information Technology Co., Ltd.; Cambricon (Hong Kong) Co., Ltd.; Cambricon (Kunshan) Information Technology Co., Ltd.; Cambricon Jixingge (Nanjing) Technology Co., Ltd.; Cambricon (Nanjing) Information Technology Co., Ltd.; Cambricon Technologies Corporation Limited; Cambricon (Xi'an) Integrated Circuit Co., Ltd.; CETC Cloud (Beijing) Technology Co., Ltd.; CETC LES Information System Group Co., Ltd.; China Electronics Technology Group Corporation No. 28 Institute; Chinese Academy of Sciences Institute of Computing Technology; Guangdong Qinzhi Technology Research Institute Co., Ltd.; Key Laboratory of Information Systems Engineering; Nanjing Aixi Information Technology Co., Ltd.; Nanjing LES Cybersecurity and Information Technology Research Institute Co., Ltd.; Nanjing LES Electronic Equipment Co., Ltd.; Nanjing LES Information Technology Co., Ltd.; Shanghai Cambricon Information Technology Co., Ltd.; Suzhou Cambricon Information Technology Co., Ltd.; System Equipment Co., Ltd. of the 28th Research Institute (Liyang); and Xiong'an Cambricon Technology Co., Ltd. under the destination of China to the Entity List for acquiring and attempting to acquire U.S.-origin items in support of China's military modernization. These entities are major artificial intelligence (AI) chip research and development, manufacturing and sales entities. These entities are, or have close ties to, government organizations that support the Chinese military and the defense industry. This activity is contrary to the national security and foreign policy interests of the United States under § 744.11(b) of the EAR. These entities are added with a license requirement for all items subject to the EAR with a footnote 4 designation with a reference to the Entity List foreign “direct product” (FDP) rule in the license requirements column of the Entity List (see §§ 734.9(e)(2) and 744.11 of the EAR). These entities are added with a license review policy of presumption of denial for all items subject to the EAR.
The ERC determined to add Shanghai Integrated Circuit Research and Development Center and Shanghai Micro Electronics Equipment (Group) Co., Ltd. under the destination of China to the Entity List for acquiring and attempting to acquire U.S.-origin items in support of China's military modernization. This activity is contrary to the national security and foreign policy interests of the United States under § 744.11(b) of the EAR. These entities are added with a license requirement for all items subject to the EAR and a license review policy of presumption of denial for all items subject to the EAR. Another BIS rule published in this same issue of the Federal Register is removing Shanghai Micro Electronics Equipment (Group) Co., Ltd. from the UVL for the reasons noted in the other rule. This entity is being added to the Entity List for reasons not related to the prevention of an end-use check.
The ERC determined to add PXW Semiconductor Manufactory Co., Ltd. under the destination of China to the Entity List for posing a significant risk of becoming involved in activities contrary to the national security or foreign policy interests of the United States. This determination is based on information that this company represents a risk of diversion to a party on the BIS Entity List. This activity is contrary to the national security or foreign policy interests of the United States under § 744.11(b) of the EAR. The ERC determined that the conduct of PXW Semiconductor Manufactory Co., Ltd. raises sufficient concern that prior review of exports, reexports, or transfers (in-country) of items subject to the EAR involving this entity, and the possible imposition of license conditions or license denials on shipments to the entity, will enhance BIS's ability to prevent violations of the EAR. This entity is added with a license requirement for all items subject to the EAR and a license review policy of presumption of denial for all items subject to the EAR.
The agencies represented on the ERC determined to add Yangtze Memory Technologies Co., Ltd. and Hefei Core Storage Electronic Limited under the destination of China and Yangtze Memory Technologies (Japan) Inc. under the destination of Japan to the Entity List for posing a significant risk of becoming involved in activities contrary to the national security or foreign policy interests of the United States. This request is based on information indicating that these companies present a risk of diversion to parties on the Entity List, to include Huawei Technologies Co., Ltd., and Hangzhou Hikvision Digital Technology Co., Ltd. This activity is contrary to the national security or foreign policy interests of the United States under § 744.11(b) of the EAR. The agencies represented on the ERC determined that prior review of exports, reexports, or transfers (in-country) of items subject to the EAR involving these entities, and the possible imposition of license conditions or license denials on shipments to the entity, will enhance BIS's ability to prevent violations of the EAR. These entities are added with a license requirement for all items subject to the EAR and a license review policy of presumption of denial for all items subject to the EAR.
The ERC determined to add AVIC Research Institute for Special Structures of Aeronautical Composites; AZUP International Group Co., Ltd.; Beijing HiFar Technology Co., Ltd.; Beijing Machinery Industry Automation Research Institute Co., Ltd.; Beijing Vision Strategy Technology Co., Ltd.; Shanghai Suowei Information Technology Co., Ltd.; and Zhongke Xinliang (Beijing) Technology Co., Ltd. to the Entity List. These entities are added for acquiring and attempting to acquire U.S.-origin items in support of China's military modernization. These entities have demonstrable ties to activities of concern, including: hypersonic weapons development, design and modeling of vehicles in hypersonic flight; designing and producing ballistic missile radomes, using proprietary software to model weapons design and damage; and otherwise supporting military-civil fusion efforts tied to the People's Liberation Army Air Force and Navy. This activity is contrary to the national security and foreign policy interests of the United States under § 744.11(b) of the EAR. These entities are added with a license requirement for all items subject to the EAR and a license review policy of presumption of denial for all items subject to the EAR.
The ERC determined to add Beijing UniStrong Science & Technology Co., Ltd. to the Entity List under the destination of China, for activity contrary to the national security or foreign policy interests of the United States. Specifically, Beijing UniStrong Science & Technology Co., Ltd. facilitated the illegal export of U.S.-origin electronics, controlled under Export Control Classification Number (ECCN) 7A994, to Iran for use in the production of military unmanned aerial vehicles and missile systems used in attacks throughout the Middle East. This activity is contrary to the national security or foreign policy interests of the United States under § 744.11(b) of the EAR. This entity is added with a license requirement for all items subject to the EAR and a license review policy of presumption of denial for all items subject to the EAR.
The ERC determined, pursuant to § 744.11(b) of the EAR, to add Tianjin Tiandi Weiye Technologies Co., Ltd. under the destination of China to the Entity List for engaging in or enabling activities contrary to U.S. foreign policy interests. Specifically, this entity has been implicated in human rights violations and abuses in the implementation of China's campaign of repression, mass arbitrary detention, and high-technology surveillance against Uyghurs, Kazakhs, and other members of Muslim minority groups in the Xinjiang Uyghur Autonomous Region (XUAR). This entity also has enabled the procurement of U.S.-origin items for use by the Islamic Revolutionary Guard Corps. These activities are contrary to U.S. national security and foreign policy interests under § 744.11(b) of the EAR. This entity is added with a license requirement for all items subject to the EAR and a license review policy of presumption of denial for all items subject to the EAR.
For the reasons described above, this final rule adds the following thirty-six entities to the Entity List and includes, where appropriate, aliases:
China
- Anhui Cambricon Information Technology Co., Ltd.,
- AVIC Research Institute for Special Structures of Aeronautical Composites,
- AZUP International Group Co., Ltd.,
- Beijing HiFar Technology Co., Ltd.,
- Beijing Machinery Industry Automation Research Institute Co., Ltd.,
- Beijing UniStrong Science & Technology Co., Ltd.,
- Beijing Vision Strategy Technology Co., Ltd.,
- Cambricon (Hong Kong) Co., Ltd.,
- Cambricon (Kunshan) Information Technology Co., Ltd.,
- Cambricon Jixingge (Nanjing) Technology Co., Ltd.,
- Cambricon (Nanjing) Information Technology Co., Ltd.,
- Cambricon Technologies Corporation Limited,
- Cambricon (Xi'an) Integrated Circuit Co., Ltd.,
- CETC Cloud (Beijing) Technology Co., Ltd.,
- CETC LES Information System Group Co., Ltd.,
- China Electronics Technology Group Corporation No. 28 Institute,
- Chinese Academy of Sciences Institute of Computing Technology,
- Guangdong Qinzhi Technology Research Institute Co., Ltd.,
- Hefei Core Storage Electronic Ltd.,
- Key Laboratory of Information Systems Engineering,
- Nanjing Aixi Information Technology Co., Ltd.,
- Nanjing LES Cybersecurity and Information Technology Research Institute Co., Ltd.,
- Nanjing LES Electronic Equipment Co., Ltd.,
- Nanjing LES Information Technology Co., Ltd.,
- PXW Semiconductor Manufactory Co., Ltd.,
- Shanghai Cambricon Information Technology Co., Ltd.,
- Shanghai Integrated Circuit Research and Development Center,
- Shanghai Micro Electronics Equipment (Group) Co., Ltd.,
- Shanghai Suowei Information Technology Co., Ltd.,
- Suzhou Cambricon Information Technology Co., Ltd.,
- System Equipment Co., Ltd. of the 28th Research Institute (Liyang),
- Tianjin Tiandi Weiye Technologies Co., Ltd.,
- Xiong'an Cambricon Technology Co., Ltd.,
- Yangtze Memory Technologies Co., Ltd., and
- Zhongke Xinliang (Beijing) Technology Co., Ltd.
Japan
- Yangtze Memory Technologies (Japan) Inc.
Revisions to the Entity List
This final rule revises three existing entries, under the destination of China.
The ERC determined to modify the entry for China Electronics Technology Group Corporation 13th Research Institute (CETC 13) under the destination of China, first added to the Entity List on August 1, 2018 (83 FR 37427). Prior to this rule, the CETC 13 entry included 12 subordinate institutions ( i.e., Bowei Integrated Circuits ; Envoltek; Hebei Brightway International; Hebei Medicines Health; Hebei Poshing Electronics; Hebei Puxing Electronic ; Hebei Sinopack Electronics; Micro Electronic Technology; MT Microsystems; North China Integrated Circuit Corporation ; Shijiazhuang Development Zone Maiteda Microelectronics Technology Development and Application Corporation; and Tonghui Electronics).
With this rule, there are two primary changes to the CETC 13 entry. First, each of the 12 subordinate institutions are now detailed under their own entries and this rule adds those entries as separate entries to the Entity List. Second, the entries for CETC 13 and the subordinate institution Micro Electronic Technology, which as described above is being added under its own entry, are being modified. The ERC determined these two entities are Russian `military end users' pursuant to § 744.21. As Russian `military end users' they are now given a footnote 3 designation in their license requirement. As Russian `military end users' with a footnote 3 designation, CETC 13 and Micro Electronic Technology are now subject to the Russia/Belarus-Military End User foreign “direct product” (FDP) rule, detailed in § 734.9(g). This decision is based on information that these companies contribute to Russia's military and/or defense industrial base. Specifically, the ERC determined that these entities have previously supplied items to Russian parties before February 24, 2022 (Russia's further invasion of Ukraine), and continue to contract to supply items to Russian parties after February 24, 2022. As a conforming change, licenses for CETC 13 and Micro Electronic Technology will be reviewed under a policy of denial for all items subject to the EAR apart from food and medicine designated as EAR99, which will be reviewed on a case-by-case basis. See §§ 746.8(b) and 744.21(e). The remaining 11 subordinate institutions will retain the original entry's license requirement for all items subject to the EAR, which will be reviewed under a presumption of denial.
The ERC has determined to modify the entry for HSJ Electronics, under the destination of China, first added to the Entity List on December 17, 2021 (86 FR 71560), by adding one additional alias and four additional addresses.
The ERC has determined to modify the entry for Tenco Technology Company Limited, under the destination of China, first added to the Entity List on May 14, 2019 (84 FR 21236), by adding one additional alias and one additional address.
Addition to the Entity List and Conforming Removal From the Unverified List
As described above under the additions to the Entity List section, the agencies represented on the ERC determined to add Yangtze Memory Technologies Co., Ltd. under the destination of China to the Entity List for posing a significant risk of becoming involved in activities contrary to the national security or foreign policy interests of the United States. This entity is being added to the Entity List for reasons not related to the prevention of an end-use check. Prior to this rule, Yangtze Memory Technologies Co., Ltd. was listed on the Unverified List in supplement no. 6 to part 744 of the EAR. For consistency with the existing BIS policy of not listing an entity on more than one of these lists at the same time, this rule makes the conforming change to remove the entity from the UVL.
Export Control Reform Act of 2018
On August 13, 2018, the President signed into law the John S. McCain National Defense Authorization Act for Fiscal Year 2019, which included the Export Control Reform Act of 2018 (ECRA), 50 U.S.C. Sections 4801-4852. ECRA provides the legal basis for BIS's principal authorities and serves as the authority under which BIS issues this final rule.
Savings Clause
For the changes being made in this final rule, shipments of items removed from eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR) as a result of this regulatory action that were en route aboard a carrier to a port of export, reexport, or transfer (in-country), on December 16, 2022, pursuant to actual orders for export, reexport, or transfer (in-country) to or within a foreign destination, may proceed to that destination under the previous eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR).
Rulemaking Requirements
1. This rule has been determined to be not significant for purposes of Executive Order 12866.
2. Notwithstanding any other provision of law, no person is required to respond to or be subject to a penalty for failure to comply with a collection of information, subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) (PRA), unless that collection of information displays a currently valid Office of Management and Budget (OMB) Control Number. This regulation involves collections previously approved by OMB under control number 0694-0088, Simplified Network Application Processing System, which includes, among other things, license applications and commodity classifications, and carries a burden estimate of 29.4 minutes for a manual or electronic submission for a total burden estimate of 33,133 hours. Total burden hours associated with the PRA and OMB control number 0694-0088 are not expected to increase as a result of this rule.
3. This rule does not contain policies with federalism implications as that term is defined in Executive Order 13132.
4. Pursuant to section 1762 of the Export Control Reform Act of 2018, this action is exempt from the Administrative Procedure Act (5 U.S.C. 553) requirements for notice of proposed rulemaking, opportunity for public participation, and delay in effective date.
5. Because a notice of proposed rulemaking and an opportunity for public comment are not required to be given for this rule by 5 U.S.C. 553, or by any other law, the analytical requirements of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., are not applicable. Accordingly, no regulatory flexibility analysis is required and none has been prepared.
List of Subjects in 15 CFR Part 744
- Exports
- Reporting and recordkeeping requirements
- Terrorism
Accordingly, part 744 of the Export Administration Regulations (15 CFR parts 730 through 774) is amended as follows:
PART 744—CONTROL POLICY: END-USER AND END-USE BASED
1. The authority citation for 15 CFR part 744 continues to read as follows:
Authority: 50 U.S.C. 4801-4852; 50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; 22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; 22 U.S.C. 7201 et seq.; 22 U.S.C. 7210; E.O. 12058, 43 FR 20947, 3 CFR, 1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p. 608; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13099, 63 FR 45167, 3 CFR, 1998 Comp., p. 208; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13224, 66 FR 49079, 3 CFR, 2001 Comp., p. 786; Notice of September 19, 2022, 87 FR 57569 (September 21, 2022); Notice of November 8, 2022, 87 FR 68015 (November 10, 2022).
2. Amend supplement no. 4 to part 744 by:
a. Under PEOPLE'S REPUBLIC OF CHINA:
i. Adding in alphabetical order entries for “Anhui Cambricon Information Technology Co., Ltd.,” “AVIC Research Institute for Special Structures of Aeronautical Composites,” “AZUP International Group Co., Ltd.,” “Beijing HiFar Technology Co., Ltd.,” “Beijing Machinery Industry Automation Research Institute Co., Ltd.,” “Beijing UniStrong Science & Technology Co., Ltd.,” “Beijing Vision Strategy Technology Co., Ltd.,” “Cambricon (Hong Kong) Co., Ltd.,” “Cambricon Jixingge (Nanjing) Technology Co., Ltd.,” “Cambricon (Kunshan) Information Technology Co., Ltd.,” “Cambricon (Nanjing) Information Technology Co., Ltd.,” “Cambricon Technologies Corporation Limited,” “Cambricon (Xi'an) Integrated Circuit Co., Ltd.,” “CETC Cloud (Beijing) Technology Co., Ltd.,” and “CETC LES Information System Group Co., Ltd.”;
ii. Revising the entry for “China Electronics Technology Group Corporation 13th Research Institute (CETC 13)”;
iii. Adding in alphabetical order entries for “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: Bowei Integrated Circuits,” “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: Envoltek,” “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: Hebei Brightway International,” “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: Hebei Medicines Health,” “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: Hebei Poshing Electronics,” “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: Hebei Puxing Electronic,” “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: Hebei Sinopack Electronics,” “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: Micro Electronic Technology,” “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: MT Microsystems,” “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: North China Integrated Circuit Corporation,” “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: Shijiazhuang Development Zone Maiteda Microelectronics Technology Development and Application Corporation,” “China Electronics Technology Group Corporation 13th Research Institute (CETC 13) subordinate institution: Tonghui Electronics,” “China Electronics Technology Group Corporation No. 28 Institute,” “Chinese Academy of Sciences Institute of Computing Technology,” “Guangdong Qinzhi Technology Research Institute Co., Ltd.,” and “Hefei Core Storage Electronic Ltd.”;
iv. Revising the entry for “HSJ Electronics”;
v. Adding in alphabetical order entries for “Key Laboratory of Information Systems Engineering,” “Nanjing Aixi Information Technology Co., Ltd.,” “Nanjing LES Cybersecurity and Information Technology Research Institute Co., Ltd.,” “Nanjing LES Electronic Equipment Co., Ltd.,” “Nanjing LES Information Technology Co., Ltd.,” “PXW Semiconductor Manufactory Co., Ltd.,” “Shanghai Cambricon Information Technology Co., Ltd.,” “Shanghai Integrated Circuit Research and Development Center,” “Shanghai Micro Electronics Equipment (Group) Co., Ltd.,” “Shanghai Suowei Information Technology Co., Ltd.,” “Suzhou Cambricon Information Technology Co., Ltd.,” and “System Equipment Co., Ltd. of the 28th Research Institute (Liyang)”;
vi. Revising the entry for “Tenco Technology Company Ltd.”; and
vii. Adding in alphabetical order entries for “Tianjin Tiandi Weiye Technologies Co., Ltd.,” “Xiong'an Cambricon Technology Co., Ltd.,” “Yangtze Memory Technologies Co., Ltd.,” and “Zhongke Xinliang (Beijing) Technology Co., Ltd.”; and
b. Under JAPAN, adding in alphabetical order an entry for “Yangtze Memory Technologies (Japan) Inc.”.
The additions and revisions read as follows:
Supplement No. 4 to Part 744—Entity List
Supplement No. 6 to Part 744—[Amended]
3. Supplement no. 6 to part 744 is amended under CHINA, PEOPLE'S REPUBLIC OF, by removing the entity “Yangtze Memory Technologies Co., Ltd.”.
Matthew S. Borman,
Deputy Assistant Secretary for Export Administration.
[FR Doc. 2022-27151 Filed 12-15-22; 8:45 am]
BILLING CODE 3510-33-P