On October 21, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) added 26 companies and individuals to the Entity List for engaging in activities contrary to U.S. national security and foreign policy. The entities added were from the following jurisdictions: China (6), Egypt (1), Pakistan (16), and the United Arab Emirates (UAE) (3). These additions were made under various rationale, including alleged violations of export controls, evasions of U.S. sanctions on Russia and Iran, and involvement in weapons programs of concern. The move follows a recent trend of significant increases in Entity List additions. Nine of the Pakistani entities named to the Entity List this week were added for being associated with a previously identified company already on the Entity List, while the remaining seven were added for contributions to Pakistan’s ballistic missile program. The three UAE entities as well as the one Egyptian entity were added for acquiring U.S.-origin parts to evade U.S. Sanctions imposed on Russia. The six Chinese entities were added for acquiring U.S.-origin items in support of their military modernization, dilatory and evasive conduct during end-use checks, and procurement of U.S.-origin items for Iran’s weapons of mass destruction program.
The BIS is tasked with administering the regulation and enforcement of trade in U.S. origin technologies regulated by the Export Administration Regulations (EAR), which grants the agency broad jurisdiction. This particular action is taken under the authority of the Export Control Reform Act of 2018 (ECRA) and the EAR.
The Entity List is one of several lists maintained by BIS, and arguably its most strict. The list identities businesses, research facilities, organizations, individuals, and other types of legal persons that are either directly involved with, or operating at an address involved with, posing a significant risk to the national security and/or foreign policy interests of the United States. Those on this list are therefore subject to individual licensing requirements, each unique to their respective entity-imposed limitations. Additions, modifications, and removals or names to/on/from the Entity List are handled by the End-User Review Committee (ERC), a body with representatives from various federal departments and agencies.
An Entity List designation can be severely debilitating and costly for companies and individuals by significantly limiting the named entity’s business and reputation. Due to de-risking, the actual repercussions of a listing can extend far beyond those mandated by the EAR, and result in counterparties such as banks and suppliers refusing to process payments or general deal with the targeted party. However, delisting is possible through an administrative process and requires unanimous approval by members of the ERC. There is a clear history of companies being removed from the Entity List. While there are no formal requirements to a delisting, there are certain steps that can be critical in making a compelling case before the committee.
Below is the full list of the new entities designated:
China
∙ Beijing Moreget Creative Technology Co., Ltd.;
∙ Detail Technology (НК) Limited;
∙ L-Tong Electronic Technology Company;
∙ Shenzhen Dragonfly Supply Chain Co., Ltd.;
∙ Shenzhen Jiachuang Weiye Technology Company, Ltd.; and
∙ Small Leopard Electronics Co., Limited
Egypt
∙ Steel Design LLC
Pakistan
∙ Ansar Mahmood;
∙ Asia Pacific Trade Hub;
∙ Combine Communications;
∙ Engineering Aura;
∙ Haris M. Fazal;
∙ Mansoor Ahmed Malik;
∙ Metal Paint Products (Pvt) Ltd;
∙ Innovative Equipment (Private) Limited;
∙ Konsult Tek (Pvt) Ltd;
∙ Marriala Consultants;
∙ Rehman Feroze;
∙ Rockside Enterprise;
∙ Technologic Enterprises;
∙ United Institute of Technical Professional Education;
∙ Usman Feroze; and
∙ Zaheer & Sons
United Arab Emirates
∙ Ahmed Abdellatif
∙ Ayman Elgindy; and
∙ Steel Design FZE
Akrivis has a history of securing removals from the BIS Entity List and the agency’s Unverified List (UVL), though notably every case is different and outcomes cannot be guaranteed. Please contact Farhad Alavi at [email protected] or (202)686-4859 should you have any questions.