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Export Controls

Commerce Keeps the Affiliates Rule on Hold Until January

The Commerce Department has put off, to Jan. 10, 2027, a rule extending export blacklist restrictions to companies at least 50 percent owned by listed ones.

WASHINGTON, Nov. 5 — The Commerce Department will keep its rule extending export restrictions to companies owned by blacklisted ones on hold until Jan. 10, 2027, two months past the date on which it was due to return. The Bureau of Industry and Security, the department’s export-control arm, filed the extension for public inspection at 4:15 p.m. on Thursday. It is to be published in the Federal Register on Monday, Nov. 9, the day the rule’s one-year suspension was set to end.

Under the rule, any company at least 50 percent owned by one or more entities on the Commerce Department’s Entity List is itself subject to the list’s restrictions, whether or not it is named.The Entity ListCommerce lists companies it has reasonable cause to believe are involved, or at significant risk of becoming involved, in activities contrary to America’s national security or foreign-policy interests. Exports, reexports and transfers of covered items involving listed parties face extra license requirements and restricted use of most license exceptions. It reaches companies at least 50 percent owned by listed military end users and by certain sanctioned parties, too. Before it, a legally distinct foreign affiliate was not covered by its listed owner’s restrictions unless Commerce named it separately.

The bureau issued the rule in September 2025, saying the old approach “can enable diversionary schemes, such as the creation of new foreign companies to evade Entity List restrictions.” It took effect on Sept. 29, 2025, and lasted six weeks. On Nov. 1, 2025, the White House said that, as part of a trade deal with China, the United States would suspend it for one year from Nov. 10, and the bureau wrote the pause into a rule later that month.The CountdownsIssued at 90 FR 47201; suspended from Nov. 10, 2025, at 90 FR 50857, to return on Nov. 10, 2026; now stayed until Jan. 10, 2027, by FR Doc. 2026-22793.

Two More Months

For exporters, the extension buys two more months before customers abroad that are half or more owned by listed companies come under the list’s license requirements. Getting ready means knowing who owns those customers. The law firm Pillsbury Winthrop Shaw Pittman, in an Oct. 22 alert, advised companies to move from screening names to screening ownership, through “multi-tier chains,” and to map customers, distributors and suppliers, “with priority on China, Russia and other higher-risk jurisdictions.”

Thursday’s filing, signed by Jeffrey I. Kessler, the under secretary for industry and security, gives no reason for the new date and does not mention China. It was issued without notice or public comment, which the export-control law allows. “This final rule did not consider public comments received on the Affiliates Rule,” it says; those comments “will be considered for future, subsequent rulemakings.”

The date matches the trade truce. Treasury Secretary Scott Bessent announced on Sept. 23 that the United States and China had agreed to extend their trade agreement, struck at Busan, South Korea, for two months through Jan. 10, 2027, according to Pillsbury and the law firm Miller Canfield. Thursday’s filing, effective Nov. 9, extends the affiliates-rule suspension to the same date. Before it, Miller Canfield wrote in an article The National Law Review published on Oct. 2 that there had been “no explicit confirmation by the U.S. government that the two month extension will apply to the Affiliates Rule.”

The Affiliates Rule has functioned as a bargaining chip in the U.S.-China trade relationship, and its timing has tracked broader negotiations rather than a fixed regulatory calendar.

— Pillsbury Winthrop Shaw Pittman, in an Oct. 22 client alert

What to Watch

The rule stays on the books. “The Affiliates Rule has functioned as a bargaining chip in the U.S.-China trade relationship, and its timing has tracked broader negotiations rather than a fixed regulatory calendar,” Pillsbury wrote. It added that the bureau could shorten or end the suspension through further rulemaking, and that after the midterm elections the administration “may reassess how aggressively to pursue a broader, more lasting trade agreement with China.”

That leaves Jan. 10 as the next date to watch, when the extended suspension and, by Mr. Bessent’s account, the trade truce are due to end.

Sources

  1. Bureau of Industry and Security (Federal Register, public inspection), “Extension of the Suspension of Expansion of End-User Controls for Affiliates of Certain Listed Entities (FR Doc. 2026-22793),” Nov. 5, 2026.
  2. Bureau of Industry and Security (Federal Register), “One Year Suspension of Expansion of End-User Controls for Affiliates of Certain Listed Entities (90 FR 50857),” Nov. 12, 2025.
  3. Bureau of Industry and Security (Federal Register), “Expansion of End-User Controls To Cover Affiliates of Certain Listed Entities (90 FR 47201),” Sept. 30, 2025.
  4. The White House, “Fact Sheet: President Donald J. Trump Strikes Deal on Economic and Trade Relations with China,” Nov. 1, 2025.
  5. Pillsbury Winthrop Shaw Pittman, “What If the BIS Affiliates Rule Comes Into Force?” Oct. 22, 2026.
  6. Miller Canfield, via The National Law Review, “BIS Affiliates Rule Suspension Extended but Uncertainty Remains,” Oct. 2, 2026.