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January 23rd

Understanding the New Export Controls on Advanced Computing and AI Models

Date of publication: January 23rd, 2025

Introduction

The Department of Commerce's Bureau of Industry and Security (BIS) has recently updated the Export Administration Regulations (EAR) to enhance controls on advanced computing integrated circuits (ICs) and artificial intelligence (AI) model weights. These changes aim to protect U.S. national security and foreign policy interests while facilitating the responsible diffusion of AI technologies.
The policy builds on previous policy releases focused on limiting exports of AI technology to the People’s Republic of China (PRC) and other countries of concern like Russia. The policy is designed to achieve two goals. First, it attempts to enable U.S. companies to export and lead in key global AI markets by reducing and streamlining current bureaucratic barriers to exports. Second, the policy further controls PRC access to the most advanced U.S.-based AI technologies through regulatory changes. The policy does not control open-source models.

Summary of main elements of the changes

  1. Establishment of country groups – the regulation divides countries into three groups. Trusted partners, or countries deemed low risk. This includes Australia, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, New Zealand, Norway, Republic of Korea, Spain, Sweden, Taiwan, and the United Kingdom. Countries of concern (country group D:5 destinations such as Russia and PRC, and Macau). All other countries fall in a middle category, such as Saudi Arabia and UAE.
  2. Regulations will ensure US headquartered companies keep most of their AI training operations in the US, or a small set of trusted allies and partner countries.
  3. The policy enables US companies to export advanced AI chips and their capabilities worldwide, except to countries of concern. The process will be streamlined where it has been proven that US companies and their partners have validated secure infrastructures in place. Universal Validated End User (UVEU) and National Validated End User (NVEU) statuses will be established for this purpose.
  4. The policy also regulates cloud access to services from U.S.-headquartered companies, attempting to close what was arguably a loophole in existing regulations that allowed PRC companies.
  5. The regulations require companies to get licenses to export closed-weight (i.e. non-open-source) AI model weights trained on more than 1026 computational operations. This will limit the potential consequences for U.S. AI leadership if frontier model weights leaked to the PRC.
Below highlights the key amendments in sections 740, 742, and 774, including changes related to Export Control Classification Numbers (ECCNs).

Section 740: License exceptions

  1. Introduction of new license exceptions:
    • License exception artificial intelligence authorization (AIA) (§ 740.27):
       Allows the export, reexport, and transfer of certain advanced computing ICs and AI model weights to specific destinations, subject to conditions.
    • License exception Advanced Compute Manufacturing (ACM) (§ 740.28):
      Authorizes the export, reexport, and transfer of eligible items to private sector end users for development, production, or storage.
    • License exception Low Processing Performance (LPP) (§ 740.29):
      Permits the export and reexport of low amounts of compute power to specific destinations, with annual volume restrictions.
  2. Updates to existing license exceptions:
  • Notified Advanced Computing (NAC) and Advanced Computing Authorized (ACA) (§ 740.8):
    Expanded to include worldwide destinations, except Macau and Country Group D:5, with additional notification requirements.

Section 742: Control policy - CCL based controls

  1. Expanded regional stability controls:
    • Worldwide License Requirement (§ 742.6(a)(6)(iii)(A)):
       Now applies to items specified in ECCNs 3A090.a, 4A090.a, and corresponding .z items, requiring a license for export to any destination worldwide.
  2. New license review policies:
    • Presumption of denial for certain destinations (§ 742.6(b)(10)(iii)(A)(1)):
      Applies to Macau and Country Group D:5.
    • Presumption of approval for low-risk destinations (§ 742.6(b)(10)(iii)(A)(2)):
       Applies to destinations listed in paragraph (a) of supplement no. 5 to part 740.
  3. Introduction of AI model weights controls (§ 742.6(a)(13)):
    • Requires a license for exporting AI model weights classified under ECCN 4E091 to all destinations worldwide.

Section 774: The commerce control list

  1. Addition of new ECCNs:
    • ECCN 4E091:
       Controls AI model weights trained on 10^26 or more computational operations, imposing a global licensing requirement.
  2. Revisions to existing ECCNs:
    • ECCNs 3A090 and 4A090:
      Updated to reflect new controls on integrated circuits and related items, with specific performance parameters outlined.
    • ECCNs 5A002, 5A004, and 5A992:
      Revised to include new subparagraphs (.z) that address items meeting or exceeding performance parameters in ECCNs 3A090 or 4A090.

Compliance dates

  • Effective date:
    January 13, 2025
  • Compliance date:
     Exporters, re-exporters, and transferors must comply with the changes by May 15, 2025. However, compliance with paragraphs 14, 15, and 18 of supplement no. 10 to part 748 is required by January 15, 2026.
  • Comment period:
     Stakeholders are encouraged to submit comments on the revisions and additions in this rule by May 15, 2025.

How to submit comments

Comments on the interim final rule can be submitted via the Federal rulemaking portal at www.regulations.gov using the regulations.gov ID BIS–2025–0001.

Contact information

For general inquiries, please contact Hillary Hess at 202–482–2440 or RPD2@bis.doc.gov. For technical questions, reach out to the designated contacts for specific categories as listed in the regulation.

Conclusion

With the recent transition to the new Trump Administration, along with various industry concerns, the longevity of this new policy remains uncertain and could depend on how key incoming figures in the Administration (such as AI/Crypto Czar David Sacks) view the policy. The Trump Administration’s stance on frontier AI export controls is still unclear and it will be wise to continue monitoring possible changes going forward.
These amendments are designed to ensure that the diffusion of advanced AI technologies is conducted responsibly, safeguarding U.S. national security while enabling beneficial global applications. For further information or assistance, please contact our support team or visit the BIS website.
These changes have been incorporated in ONESOURCE Global Trade Content.
For more information on how ONESOURCE Global Trade solutions can assist you in managing sanctions and export controls, please contact your Account Manager or Client Services Manager.

This article applies to:

  • Product: ONESOURCE Global Trade