On November 26, 2024, the US Commerce Department’s Bureau of Industry and Security (“BIS”) issued a final rule (“Final Rule”) imposing new licensing requirements on exports, reexports, and transfers (in-country) to and within Pakistan of certain items identified on the Commerce Control List (“CCL”) that are subject to the Export Administration Regulations (“EAR”). This expansion of controls is intended to address BIS’ concern that certain CCL items that are not currently controlled for Pakistan have been sought by Entity List parties and by front companies operating on behalf of such entities. The new controls discussed will be effective on December 26, 2024.
The Final Rule imposes the following CCL-based requirements:
- ECCNs 1B999, 2A992, 2B999 (other than 2B999.h.2), 3A992, 3A999, and 6A996 will now be subject to a BIS licensing requirement for export or reexport to Pakistan or transfer within Pakistan for regional stability (“RS”) reasons. These ECCNs describe the following items:
- 1B999 (“Specific Processing Equipment, n.e.s.”);
- 2A992 (“Piping, fittings and valves made of, or lined with stainless, copper-nickel alloy or other alloy steel containing 10% or more nickel and/or chromium”);
- 2B999 (“Specific Processing Equipment, n.e.s.”), except 2B999.h.2;
- 3A992 (“General purpose electronic equipment not controlled by 3A002”);
- 3A999 (“Specific Processing Equipment, n.e.s.”); and 6A996 (“‘Magnetometers’ not controlled by ECCN 6A006, ‘Superconductive’ electromagnetic sensors, and ‘specially designed’ ‘components’ therefor”)
- The following BIS license exceptions are the only exceptions that will be available for the export, reexport, or transfer (in-country) to or within Pakistan of items subject to the new license requirement:
- License Exception TMP, limited to 15 C.F.R. §§ 740.9(a)(1), (a)(4), (a)(5), (a)(10), (b)(2), and (b)(3);
- License Exception RPL; and
- License Exception GOV, limited to 15 C.F.R. §§ 740.11(a), (b), and (d).
However, these license exceptions are generally unavailable when a party on the Entity List is a party to the transaction.
- License applications for exports, reexports, or transfers (in-country) to or within Pakistan of the items subject to the new license requirement are subject to a case-by-case license review policy.
The Final Rule includes a savings clause for shipments of items that were en route aboard a carrier to a port of export or reexport on December 26, 2024 pursuant to actual orders for export or reexport to a foreign destination. The Final Rule also includes a reminder to exporters, reexporters, and transferors of items to Pakistan that are subject to the EAR that as a best practice they should review BIS’s Pakistan Due Diligence Guidance.
