RESTRICT Act

New export rules for advanced chips

If enacted, this bill would require a license from the Under Secretary of Commerce for Industry and Security to export, reexport, or transfer certain "advanced integrated circuits" to countries listed in Country Group D on January 1, 2025. "Advanced integrated circuit" would mean chips or products classified under ECCN 3A090, 4A090, or a '.z' ECCN as of Jan 1, 2025, or products functionally similar to those, and designed or marketed for data centers. The bill would direct Commerce to deny licenses when the recipient or its parent is mainly located in a "country of concern" (Country Group D:5 as of Jan 1, 2025, plus Macau and Hong Kong). Transfers to other covered countries would be allowed without a license only if the item stays under the ownership and control of an "approved United States person." The Under Secretary would have to write rules within 90 days to approve U.S. persons and those rules would limit ultimate beneficial ownership by any entity in a country of concern to no more than 10%, require physical and cybersecurity controls, robust know-your-customer checks, and annual audits or attestations. The Under Secretary could revise the chip definition starting 24 months after enactment with 30 days' notice to two congressional committees if there is no adverse national security impact. The whole regime would sunset five years after enactment.