Effective October 9, 2019, 28 additional entities based in China, including Chinese video surveillance firm Hikvision, are expected to be added to the Entity List maintained by the U.S. Department of Commerce, Bureau of Industry and Security (BIS). As a result, BIS licenses will be required for exports, reexports, and transfers of items subject to U.S. export regulations to the listed entities. The licensing requirements are expected to go into effect on October 9, 2019, the expected date of publication of the notice in the Federal Register. A copy of the notice can be viewed here.
The Entity List is the same list that covers Huawei Technologies Co. Ltd and its listed affiliates. The newly added entities include Dahua Technology, Hikvision, IFLYTEK, Megvii Technology, Sense Time, Xiamen Meiya Pico Information Co. Ltd., Yitu Technologies, and Yixin Science and Technology Co. Ltd., along with the Xinjiang Uighur Autonomous Region Peoples Government Public Security Bureau, eighteen of its subordinate municipal and county public security bureaus, and one other subordinate institute.
As noted above, a license from BIS will be required for exports, reexports, and in-country transfers (collectively "exports") to these newly listed entities of items subject to the Export Administration Regulations (EAR), including technology, software, and commodities exported from the United States and certain foreign-produced items. The license requirement is triggered by the involvement of a listed entity in a transaction, not the sensitivity (or lack thereof) of the item being shipped. Items that cannot be exported include, but are not limited to, U.S.-origin hardware, chips, software, and technology, even if located abroad, as well as software updates, bug fixes, and/or other updates to items that had previously been exported. There is a policy of denial for license applications to these entities with limited exceptions. License applications for some items, including those used in the protection against chemical or biological agents, will be reviewed on a case by case basis.
These listed entities were sanctioned based upon the U.S. governments belief that they have been engaging in activities contrary to U.S. national security and foreign policy interests, including human rights violations, abuses in the implementation of Chinas campaign of repression, mass arbitrary detention, and high-technology surveillance against Uighurs, Kazakhs, and other members of Muslim minority groups.
If you would like to discuss this matter, please contact Josephine Aiello LeBeau, 202-973-8813, jalebeau@wsgr.com; Melissa Mannino, 202-973-8856, mmannino@wsgr.com; Anne Seymour, 202-973-8874, aseymour@wsgr.com; or any member of the export control and economic sanctions practice at Wilson Sonsini Goodrich & Rosati.
