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U.S. Bureau of Industry and Security (BIS)

Call 305-456-3830 or email info@diaztradelaw.com.

ICYMI: Technology Company Pleads Guilty to Export Control Violations, Agrees to $140M Fine

The U.S. Attorney’s Office for the Northern District of California and the Counterintelligence and Export Control Section (CES) of the Department of Justice’s (DoJ) National Security Division announced that Cadence Design Systems, Inc. of San Jose, California, agreed to plead guilty to resolve criminal violations of export controls. 

As part of the plea agreement, Cadence will pay criminal penalties of nearly $118 million. 

In addition to the charges, the Department of Commerce’s Bureau of Industry and Security (BIS) also announced the resolution of a civil enforcement action against the company in which Cadence agreed to pay over $95 million in civil penalties. 

The DoJ and BIS have coordinated the resolution of the parallel investigation, and each agreed to a partial credit against their fine for payments made to satisfy the other agency’s fine. Under the coordinated agreement, Cadence will pay criminal and civil penalties of more than $140 million.

Cadence committed criminal violations of the export control laws by selling hardware, software, and semiconductor design intellectual property to the National University of Defense Technology (NUDT) in China. NUDT was added to the Department of Commerce’s Entity List in February 2015. The university was involved in the development of supercomputers with applications for military and nuclear explosive simulations. 

Cadence and its Chinese subsidiary engaged in a conspiracy to commit export control violations by exporting this technology to NUDT without obtaining the requisite licenses from […]

By |2025-08-07T11:02:32-04:00August 7, 2025|EAR, Enforcement, Export, International Trade, Technology, U.S. Bureau of Industry and Security (BIS), U.S. Department of Justice (DOJ)|0 Comments
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ICYMI: BIS Initiates 232 Investigations of UAS and Polysilicon Imports

On July 15, 2025, the Bureau of Industry and Security announced Section 232 National Security Investigations of: (i) Unmanned Aircraft Systems (UAS) and their parts/components, and (ii) polysilicon and related derivatives.

The Federal register notices are available here (UAS) and here (polysilicon).

BIS is specifically interested in the following information:

  1. The current and projected demand for these products and the extent to which domestic production can meet this demand
  2. The role of foreign supply chains, particularly of major exporters, in meeting United States demand 
  3. The concentration of U.S. imports from a small number of suppliers and the associated risks
  4. The impact of foreign government subsidies and predatory trade practices 
  5. The economic impact of artificially suppressed prices due to foreign unfair trade practices and state-sponsored overproduction
  6. The potential for export restrictions by foreign nations
  7. The feasibility of increasing domestic capacity to reduce import reliance
  8. The impact of current trade policies on domestic production and whether additional measures, including tariffs or quotas, are necessary to protect national security

The deadline to submit comments is August 6, 2025.

The investigations could result in new trade restrictions, including tariffs. If you import products covered under these investigations, make your […]

By |2025-07-22T07:45:47-04:00July 22, 2025|Enforcement, Export, Import, International Trade, tariffs, Trade Policy, U.S. Bureau of Industry and Security (BIS)|0 Comments
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Reporting, Requestor List, Penalties: Antiboycott Laws Explained

The United States enforces antiboycott laws designed to address foreign government’s economic boycotts of countries friendly to the U.S. Antiboycott laws have been on the books since the 1970s and are primarily enforced by the U.S. Department of Commerce’s Bureau of Industry and Security.

What Are the U.S. Antiboycott Laws?

“Anti-boycott” refers to U.S. laws and regulations that discourage and, in certain cases, prohibit U.S. persons from participating in unsanctioned foreign boycotts, particularly those targeting countries friendly to the United States.

BIS is charged with administering and enforcing this policy under the Anti-Boycott Act of 2018, the Export Control Reform Act of 2018, and the Export Administration Regulations.

The antiboycott laws aim to prevent U.S. persons from advancing foreign policies of other nations that run counter to U.S. policy.

Prohibited Antiboycott Activities Under the EAR

Part 760 of the EAR specifies prohibited antiboycott activities including:

  • Refusals or agreements to refuse to do business with or in a boycotted country or with blacklisted companies.
  • Discrimination or agreements to discriminate against a U.S. person based on race, religion, sex, or national origin.
  • Furnishing information or agreements to furnish information about business relationships with or in a boycotted country or with blacklisted companies.
  • Furnishing information or agreements to furnish information about the race, religion, sex, or national origin of a U.S. person.
  • Implementation of letters of credit containing prohibited boycott terms or conditions.
  • Taking actions with the intent to evade Part 760 of the EAR.

Required Reporting        

Section 760.5 of the EAR requires […]

By |2025-04-07T18:45:32-04:00April 7, 2025|EAR, Export, U.S. Bureau of Industry and Security (BIS)|0 Comments
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BIS Issues Guidance to Financial Institutions on Best Practices for Compliance with the Export Administration Regulations

The Department of Commerce’s Bureau of Industry and Security (BIS) recently published guidance for financial institutions containing several recommendations for complying with the Export Administration Regulations (EAR).

The guidance provides recommendations on steps financial institutions can take to minimize the likelihood of EAR violations. The recommendations focus on three key areas: due diligence best practices, reviewing transactions for red flags, and real-time screening.

Due Diligence Best Practices

The guidance recommends that financial institutions incorporate EAR related due diligence into their compliance and risk management and compliance processes. Due diligence should be conducted both before onboarding a new customer and as part of regular due diligence thereafter.

Specifically, BIS recommends that financial institutions:

  • Review customers against lists of persons subject to BIS’s end-user restrictions
  • Review customers – and, where appropriate, customers’ customers – against lists of entities that have shipped Common High Priority List (CHPL) items to Russia since 2023
  • Ask a customer to certify that it has controls in place to comply with the EAR if the customer is engaged in the export, reexport or transfer of items subject to the EAR and is on a restricted-party list
Review Transactions for Red Flags

The guidance recommends that financial institutions review transactions on an ongoing basis for red flags:

  • Purchases under a letter of credit that are consigned to the issuing bank, not to the actual end user.
  • Transactions involving entities with little to no web presence, such as a website or a domain based email account.
  • A customer lacks or refuses to […]
By |2024-10-11T15:11:38-04:00October 11, 2024|Export, U.S. Bureau of Industry and Security (BIS), U.S. Department of Commerce (DOC)|0 Comments
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BIS Issues Final Rule on VSD Policies and Penalty Guidelines

BIS recently issued a final rule to amend the Export Administration Regulations (EAR), making several changes to their Voluntary Self Disclosure (VSD) policies, as well as updates to guidance on penalty determinations.

The rule codifies previously announced policy changes through several Policy Memoranda including an April 2023 memorandum on voluntary-self disclosures, and a June 2022 memorandum on strengthening administrative enforcement.

Revisions to Voluntary Self-Disclosures

The rule makes both substantive and procedural changes to the VSD policies:

  1. Addition of non-disclosure as an aggravating factor – the new rule makes clear that BIS will consider a deliberate decision to not disclose a violation as an aggravated factor when determining what administrative sanctions will be imposed.
  2. New dual track for processing VSDs – one track for minor or technical violations, the other for significant violations.
  3. Authorizes any person (not just the party submitting a VSD) to notify the Director of BIS’s Office of Export Enforcement (OEE) that a violation has occurred and to request permission to engage in corrective activities.

Revisions to Penalty Guidelines

This rule makes several changes to the BIS Penalty Guidelines, including:

  1. Changes the base penalty caps:
    1. Non-egregious VSD cases: was $125,000, now one-half of the transaction value.
    2. Non-egregious cases that are not initiated by a VSD: was $250,000, now the full transaction value.
  2. Permits BIS to use  non-monetary penalties to resolve cases that are not egregious and have not resulted in national security harm, but rise above the level of cases warranting a warning letter.
  3. Removes from the BIS […]
By |2024-09-26T16:04:14-04:00September 26, 2024|EAR, Export, U.S. Bureau of Industry and Security (BIS)|0 Comments
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