Unilateral Controls: When the US Government Does Its Own Thing
By Cynthia Roberts, Senior Consultant
The Export Administration Regulations (“EAR”) include many different items in its Commerce Control List (“CCL”), which are subject to special restrictions. Some of the listed goods, software, and technologies are export-controlled in many countries around the world, while others have unique controls applied only by US regulations or only by regulations in a few countries. The US and other countries are increasingly using unilateral controls to provide a more rapid export-control response to changing technologies and world activities.
Are new unilateral US controls changing compliance requirements for your university or company?
What are Multilateral Controls?
Multilateral Controls are based on agreements between multiple countries that specifically define targeted control lists and associated restrictions to limit the proliferation of WMDs, conventional weapons, and related goods and technologies. The most common Multilateral Agreements are the Australia Group, the Missile Technology Control Regime, the Nuclear Suppliers Group, and the Wassenaar Arrangement.
Items listed in these agreements can often be sent to or shared with partner countries without licenses or using license exceptions. Historically, most items in the EAR have been subject to multilateral controls.
What Are Unilateral Controls?
Unilateral controls are unique control lists or restrictions that are applied by a single country outside the scope of formal multilateral agreements. Goods, software, and technologies captured by these unilateral controls are subject to restrictions based on the laws and regulations of the issuing country, but are not generally restricted in other countries.
When items are added to national control lists, they are often published alongside information that provides background on the reason for their creation. The US, Japan, France, Italy, Spain, China, the UK, and the Netherlands are among the countries that have national control lists that extend beyond multilateral agreements.
The US has some unilateral controls that apply only minimal restrictions. For example, some items have controls restricting transfers involving Cuba, Iran, North Korea, or Syria, while other US unilateral controls are extensive and restrict transactions worldwide. The number and complexity of unilateral controls have been increasing rapidly in recent months.
Why Do Unilateral Export Controls Matter?
Knowing why an item is controlled can help your organization understand why a government license might be needed. Knowledge of export controls, including unilateral ones, can allow you to ensure your research personnel are properly authorized, tailor product development strategy, and refine your marketing plans. Awareness of areas where unilateral controls are changing and increasing also helps prioritize relevant export-control risk mitigation activities as regulations evolve.
Example 1: American AI Exports Program
Quantum computing, semiconductors, and AI chips and technology are among the areas where multiple countries, including the US, have recently created new unilateral export controls. The new US controls mean a significant number of advanced computing goods, software, and technologies now require licenses to share with customers and research partners, including certain employees (i.e., employees who are “foreign persons” as defined in the EAR).
EAR Updates in Advanced Computing, Semiconductors, and AI
Grab an infographic that summarizes changes in the EAR, including new ECCNs, license exceptions, foreign direct product rules, and more!
In an effort to increase the competitiveness of US companies that comply with the new restrictions, the “American AI Exports Program” is being created. Its goal is to increase the export of full AI technology stacks to allied countries.
US organizations looking to export full packages can request additional support from the government. Full packages include AI-optimized hardware, data pipelines, AI models, cybersecurity measures, and specialized applications for key sectors. Proposals can include requests for loans and financial guarantees, diplomatic support, and technical assistance. Proposal selection does not change export control compliance requirements, but the prioritization may support the licensing process for selected organizations.
Refinement of and additions to the new unilateral controls in areas related to AI and advanced computing are expected to continue with more future rules from the Bureau of Industry and Security (“BIS”). Organizations working or researching in the space should follow relevant updates to ensure ongoing compliance.
Example 2: Biotechnology
Biotech is another area where rapid technological advancements are leading to new unilateral controls. Recent US unilateral controls were related to potential human performance enhancement, brain-machine interfaces, biologically-inspired synthetic materials, and possibly biological weapons, all of which may have uses for military applications. New export control classification numbers (ECCNs) 3A069 and 3E069 on the CCL capture certain laboratory equipment and related technology in the biotech area.
The recent biotech rule also included changes to the Regional Stability reason for control. Items captured by the new ECCNs or by related portions of ECCNs 3A999 and 3E001 are subject to new unilateral controls that restrict transfers involving specified countries.
These new unilateral US ECCNs capture certain flow cytometers and cell sorters and specific liquid chromatography mass spectrometry instruments, but additional ECCNs in the field may follow in future rules, as biotechnology is one of the emerging technologies that BIS has focused on.
Example 3: Export Controls Implemented in Response to Russia’s Invasion of Ukraine
Another area that can trigger export controls outside of formal multilateral agreements relates to countries targeted for hostile activities. One example is export controls on Russia, which is a focus based on its activities in Ukraine. In February 2022, the Group of 7 (“G7”) countries agreed to work together on export controls and sanctions, but no formal agreement was signed. Restrictions on Russia have been evolving throughout the conflict and may be eliminated when the conflict ends. The restrictions that the G7 countries have implemented can be thought of as parallel unilateral controls that can be changed or eliminated by any one country without further consensus by the other G7 nations.
US financial sanctions on Russia are predominantly managed under OFAC, but restrictions on US goods, software, and technologies that may involve transactions with Russia or Russian citizens are being managed by BIS. BIS has shared red flags and best practices identified by the G7 to minimize diversion risk.
In 2024, the G7 added several items to the list of target items, including CNC machine tools and components, which may be used by Russia’s military. US enforcement efforts are following the evolution and also focusing on this area. Haas Automation was fined over $2.5 million based in part on the actions of their distributors in violation of US export controls.
Organizations with activities that may involve Russia, China, or other high-risk destinations should focus on relevant changes to US unilateral export controls and ensure compliance, both directly and indirectly, such as via a distributor or research partner.
Staying on Top of US Unilateral Export Controls
The US and other countries are increasingly using unilateral export controls to achieve policy goals and to restrict access to critical high-tech goods and technologies. If you work with any “foreign person” or if your goods, software, or technologies may end up outside of the US, it is critical to understand the countries and high-tech areas currently undergoing rapid changes. If your university’s research or company’s focus overlaps with any of these high-risk areas, then ensuring your organization’s risk mitigation activities include appropriate export controls monitoring is especially critical to ensuring ongoing export compliance.
Are you wondering how to keep up?
Consider signing up for concise and timely Breaking News Updates through Traliance’s Export Controls Essential Training Program. We continuously monitor for relevant, real-time EAR changes – and then provide you with a distilled summary of what has changed and what you need to do.
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