On November 1, 2025, the White House issued a fact sheet stating that the United States, as part of a deal with China, will suspend for one year, beginning November 10, 2025, implementation of the U.S. Department of Commerce’s Bureau of Industry and Security’s (“BIS”) interim final rule expanding end-user controls to cover certain foreign affiliates of listed parties (the “Affiliates Rule”).[1] The Affiliates Rule was published on October 2, 2025, and we summarized the rule in a recent client memorandum.[2]
What the White House Proposed
According to the White House fact sheet, the United States will suspend for one year the implementation of the interim final rule titled “Expansion of End-User Controls to Cover Affiliates of Certain Listed Entities,” effective November 10, 2025. Although this regulatory change was occasioned by the agreement undertaken with China, we understand that the suspended implementation will apply to the rule in its entirety and will not be limited in application to affiliates of Chinese-listed entities.
As described in our prior alert, the Affiliates Rule had extended Entity List, Military End‑User List, and certain SDN-related restrictions to any foreign entity 50% or more owned, directly or indirectly and in the aggregate, by one or more listed parties, and adopted a “most-restrictive owner” standard, a new Red Flag, conforming foreign direct product rule changes, and a narrow temporary general license.
The Affiliates Rule initially took effect on September 29, 2025. The limited temporary general license that BIS issued contemporaneously with the Affiliates Rule expires on November 28, 2025. As a result of the Affiliates Rule, companies could no longer rely on screening for only the names that appear on the relevant BIS-maintained list and would, as a practical matter, need to rely on vendors or their own research to determine the names of affiliates covered by the Affiliates Rule.[3]
Practical Implications
We expect BIS will issue a formal action to effectuate this one-year pause, and the precise timing and form of that action remain to be seen.
Companies should monitor for the finalization of the suspension. Companies may also wish to use the one-year suspension to develop and test their plans for screening against a broader set of affiliates when the rule eventually comes into effect.
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[1] The White House, Fact Sheet: President Donald J. Trump Strikes Deal on Economic and Trade Relations with China (Nov. 1, 2025), available here.
[2] Paul, Weiss, New Commerce Rule Applies Entity List and Other Restrictions to 50% or Greater Owned Foreign Affiliates (Oct. 2, 2025), available here.
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