A Watershed Second for Export Controls – The Dangers and Complexities of the Commerce Department’s “Affiliates Rule”

Client Alert  |  October 3, 2025

---

The long-predicted transfer by the U.S. Commerce Department to develop the scope of U.S. export controls got here into pressure on September 29, 2025.  This is a historic enlargement of rules, and the sweeping new “Affiliates Rule” expands the scope of restrictions and introduces new and extremely consequential compliance challenges for exporters throughout many sectors of the worldwide financial system.

The U.S. Department of Commerce’s Bureau of Industry and Security (BIS) published an interim last rule amending the Export Administration Regulations (EAR) to implement the so-called “Affiliates Rule,” efficient September 29, 2025.  The modification—one of many furthest reaching modifications to BIS rules in years—basically alters how export restrictions apply to subsidiaries and sure associates of events which can be included on three of BIS’s restricted celebration lists: the Entity List, the Military End-User (MEU) List, and a subset of events on the Specially Designated Nationals and Blocked Persons (SDN) List maintained by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) which can be captured by associated BIS controls.

For months, BIS had reportedly been growing its personal model of the “50 Percent Rule” utilized by OFAC.  The OFAC rule applies sanctions to entities owned 50 % or extra by events on the SDN List and sure different restricted-party lists.  BIS’s new Affiliates Rule mirrors this method, making use of it throughout the Entity List, MEU List, and SDN-Related End-User Controls below part 744.8 of the EAR (SDN End-User Controls).  The rule took rapid impact on launch for public inspection on September 29, 2025, with sure transactions excepted below a carve-out for items already in transit and a restricted non permanent 60-day common license (expiring December 1, 2025).  As with sanctions rules, exporters are strictly answerable for violations as of the efficient date.

The Affiliates Rule extends licensing necessities, exceptions, and evaluate insurance policies relevant to listed events to any international affiliate owned 50 % or extra by a number of listed entities, whether or not instantly or not directly, individually or within the mixture.  This represents a pointy departure from BIS’s prior method, which didn’t mechanically prolong restrictions to unlisted “legally distinct“ associates of listed events.

Under the prior regime, transactions with these unlisted associates may happen with no license, offered they weren’t in any other case topic to item-, country-, or common end-use-based restrictions.  Under this new framework, nonetheless, 1000’s—probably tens of 1000’s—of extra firms now fall below a license requirement.  The compliance implications are sweeping.  Companies of all sizes will now face heightened diligence burdens, stricter licensing requirements, and important uncertainty in enforcement.

I.  Background on Relevant End-User Controls and Historical Approach

BIS maintains end-user controls to stop U.S.-origin items, software program, and expertise, and sure by-product gadgets, from reaching actors who threaten U.S. nationwide safety or international coverage pursuits.  These controls impose license necessities for the export, reexport, and switch (in-country) of some or all gadgets topic to the EAR when these transactions contain focused finish customers.  We present a short overview of every set of controls and the “legally distinct” commonplace that BIS has traditionally adopted of their implementation.

• The Entity List. BIS prohibits the unlicensed export of specified U.S.-origin gadgets to events on the Entity List.  License functions are usually reviewed below a coverage of denial or a presumption of denial, although in some circumstances BIS conducts a case-by-case analysis.  Exporters to listed events are additionally precluded from making use of most BIS license exceptions.  The interagency End-User Review Committee (ERC) adds to the Entity List these events “reasonably believed” to be concerned in actions opposite to U.S. nationwide safety or international coverage pursuits, or that in any other case “pose a significant risk of being or becoming involved” in such actions.

• The MEU List. Under the MEU rule, transactions involving gadgets for “military end users“ (a.k.a. MEUs) or “military end uses“ in certain countries often require a license from BIS, with license exceptions limited to certain government shipments.  Specifically, when destined for Russian and Belarusian military end users, any item subject to the EAR (that is, both items enumerated on the Commerce Control List and less controlled “EAR99” gadgets) requires a license.  In addition, many, however not all, gadgets topic to the EAR destined for Burmese, Cambodian, Chinese, Nicaraguan, and Venezuelan army finish customers require a license.  While business is predicted to establish MEUs via independent due diligence in most contexts, the ERC has recognized and designated a small variety of army finish customers to the MEU List (Supplement No. 7 to Part 744 of the EAR) for representing an “unacceptable risk of use in or diversion to a ‘military end use’” of their respective nations.

• SDN End-User Controls. BIS additionally implements license necessities for all gadgets topic to the EAR for SDNs designated below sure OFAC-administered sanctions applications.  These export controls are designed to enrich OFAC’s sanctions restrictions, which typically prohibit U.S. individuals (g., U.S. firms and monetary establishments) from transacting with SDNs.  BIS’s restrictions prolong these prohibitions to sure actions by non-U.S. individuals who might not in any other case typically be topic to OFAC restrictions.  This is as a result of non-U.S. individuals have legal responsibility below the EAR once they export, reexport, or switch (in-country) U.S.-controlled gadgets, even when the transaction doesn’t in any other case contain U.S. individuals.   Note, usually, as soon as comes below the EAR’s jurisdiction, it stays topic to the EAR via any subsequent onward transactions, in any nation.

For a few years, BIS employed a “legally distinct” commonplace: Entity List and MEU List restrictions utilized solely to the particular entities named on these lists, in addition to their non-legally distinct branches; and the SDN End-User Controls utilized solely to events named on the SDN List—and to not unlisted entities that had been in any other case coated below OFAC’s 50 Percent Rule.  In different phrases, subsidiaries of the listed events weren’t topic to the identical restrictions as their guardian firms except they had been individually listed.

II.  The Affiliates Rule: Who It Covers, How It Works, and New Requirements

In follow, BIS has discovered that the “legally distinct” commonplace exacerbated a so-called “whack-a-mole“ downside—listed events may frequently create new associates to behave as diversionary channels, forcing BIS to situation repeated dietary supplements to the Entity List to seize them one after the other.  On September 29, 2025, citing its broader aim to scale back administrative burden and strengthen nationwide safety by slicing off oblique entry to U.S. expertise, BIS shifted to the Affiliates Rule.  While the brand new rules got here into impact instantly, BIS is accepting public feedback via October 29, 2025, and will make modifications.

The Basics of The New Standard.  Under the Affiliates Rule, a “foreign affiliate[] of listed entities [that is] owned 50 percent or more, directly or indirectly, by one or more listed entities on the Entity List, MEU List, or an SDN identified in Part 744.8(a)(1) or by one or more entities subject to restrictions based upon ownership” can be topic to the identical EAR licensing necessities because the listed entity or entities.  BIS Entity List FAQ 43 notes that, like OFAC’s 50 Percent Rule, the Affiliates Rule speaks to direct and oblique possession, to not management, given the sensible challenges of measuring the extent of “control” versus possession. (As mentioned beneath, indicia of management can however create a purple flag requiring additional due diligence.)

Ownership Aggregation.  Critically, possession for functions of the Affiliates Rule is aggregated throughout all three lists: the Entity List, the MEU List, and SDNs recognized in Part 744.8(a)(1).  For instance, if Company A is 20 % owned by an Entity List Party, 20 % owned by an MEU List Party, and 10 % owned by a celebration topic to SDN End-User Controls, then Company A is handled as a restricted celebration, and the restrictions relevant to all three listed guardian entities should be thought-about, as detailed beneath (see “Rule of Most Restrictiveness”).  Note that SDN End-User Controls would nonetheless apply to Company A, despite the fact that 10 % SDN possession wouldn’t be ample to set off the appliance of OFAC’s 50 Percent Rule.  As a end result, organizations should train larger warning—and double-check the appliance of the Affiliates Rule—if minority SDN possession is recognized in due diligence.

“Rule of Most Restrictiveness.”  The interim final rule states that if the possession threshold is met via aggregation, an unlisted affiliate turns into “subject to the most restrictive license requirements, license exception eligibility, and license review policy applicable to one or more of its owners under the EAR.”  In follow, which means that as long as a listed celebration holds any possession curiosity, even a minority curiosity, its stricter necessities circulate via to the affiliate.  Further, if listed house owners every are topic to completely different (non-comprehensive) restrictions, all stated restrictions relevant to any proprietor apply to the non-listed affiliate.   The example beneath, offered by BIS, illustrates the appliance nicely:

Company C is owned 50 % or extra, instantly or not directly, by Companies A and B, each listed entities.  As a end result, the Entity List license necessities for Company C are the identical as if the merchandise had been destined for its listed house owners.  Because Company A’s license necessities and evaluate coverage are extra restrictive, these necessities govern any transaction involving Company C.  The particular possession break up is irrelevant—for instance, Company B holding 35 % and Company A holding 15 % would nonetheless set off software of Company A’s extra restrictive necessities.

Notably, the Rule of Most Restrictiveness can lead to extra stringent BIS license necessities on sanctioned events than these below OFAC rules.  For instance, the place a company transacts with a counterparty topic to the Affiliates Rule that’s 50 % owned by an SDN topic to BIS SDN End-User Controls and 10 % owned by an Entity List celebration that can’t obtain any gadgets topic to the EAR, this rule would supersede any out there OFAC General License.  That is, even when an OFAC General License would typically allow transacting with a counterparty that’s constructively sanctioned by software of the OFAC 50 Percent Rule (as a counterparty 50 % owned by an SDN can be), software of the brand new Affiliates Rule would successfully nullify the OFAC General License for any transactions involving gadgets topic to the EAR.  In different phrases, as a result of the Rule of Most Restrictiveness applies probably the most restrictive prohibition, events can be unable to export items to the celebration even when OFAC would permit them to take action.

Other Key Features.  While not an exhaustive listing, we describe briefly beneath extra key options of the Affiliates Rule that add complexities and dangers.

1. Exclusion of U.S. Affiliates. The Affiliates Rule applies solely to international associates of listed entities and doesn’t prolong to U.S.-based associates, a limitation that doesn’t exist below OFAC’s 50 Percent Rule.  This distinction displays the completely different functions of the 2 requirements: BIS’s Affiliates Rule is designed to stop diversion to unlisted associates of listed events, whereas OFAC’s 50 Percent Rule is concentrated totally on blocking listed events’ “property” (which OFAC interprets to incorporate entities owned 50 % or extra).
2. Inclusion of Indirect Ownership. Much as with OFAC’s 50 Percent Rule, the Affiliates Rule requires consideration of oblique possession.  If a guardian firm of a counterparty is just not instantly listed on a coated BIS restricted celebration listing, however it’s captured by the Affiliates Rule, then it’s handled as whether it is instantly listed for the needs of the evaluation.  As a end result, the one option to be fully sure a counterparty is just not coated by the Affiliates Rule is to establish the counterparty’s final useful house owners.  (See up to date BIS Entity List FAQ 52 for an instance.)
3. Inclusion of Overseas Branch and Sales Offices. The Affiliates Rule captures department and gross sales workplaces in any nation—not simply in the identical nation because the listed entity (as was the case below the “legally distinct” commonplace).  BIS offers a selected instance: A Malaysian gross sales workplace of a China-based entity included on the Entity List—which might have beforehand fallen outdoors of BIS’s enforcement scope, except it was individually listed—is roofed by the Affiliates Rule.
4. Exclusion of Unlisted MEUs. The Affiliates Rule applies solely to MEUs recognized on the MEU List.  It doesn’t prolong to associates of “military end users” that aren’t on the MEU List however who’re in any other case topic to the MEU rule as a result of they meet the definition of an MEU below Section 744.21(g) of the EAR.  (See Section I of this text for extra data on the MEU List.)
5. Exclusion of UVL and DPL Parties. The Affiliates Rule does not apply to subsidiaries of events on BIS’s Unverified List (UVL) (i.e., a listing of events whose bona fides BIS couldn’t affirm), Military Intelligence End User (MIEU) List, or Denied Persons List (DPL) (i.e., a listing of events who’re prohibited from exporting items topic to the EAR), though BIS invitations additional feedback on whether or not to increase the Affiliates Rule’s scope to cowl these lists sooner or later.
6. Exclusion of Entity List “Address Only” Entries. The Affiliates Rule doesn’t impose licensing necessities on associates owned 50 % or extra by unlisted entities who’re merely working at an handle that has been added to the Entity List as an “address only” entry (e., an entry displaying an handle however no related entity identify) (except the house owners are unlisted however themselves topic to the Affiliates Rule).

Temporary Relief.  BIS has issued a Temporary General License (TGL), expiring December 1, 2025, that authorizes sure in any other case restricted transactions involving non-listed international associates of listed entities which can be newly restricted by the Affiliates Rule.  The TGL covers (i) exports, reexports, or in-country transfers to or inside locations in Country Groups A:5 and A:6 and (ii) transactions outdoors Country Groups E:1 and E:2 involving joint ventures with U.S. or Country Group A:5 and A:6 companions which can be themselves not majority-owned by listed entities.  A financial savings clause additionally permits shipments in-transit as of September 29, 2025, to proceed if accomplished by October 29, 2025.

Removal or Exclusion Requests.  Starting September 29, 2025, any unlisted entity captured by the Affiliates Rule might petition BIS to change its house owners’ Entity List entries in order to be excluded from the rule.  As described beneath, there’s a threat these entities might however be topic to “de-risking” actions by exporters, banks, and freight forwarders.

Affirmative Duty of Due Diligence.  The Affiliates Rule introduces new compliance obligations by including Red Flag 29 to Supplement No. 3 to Part 732 of the EAR, which requires events to verify possession proportion or acquire a license when listed possession is suspected, identified, or in any other case indicated.  If possession can’t be verified, a license software should be filed (if BIS later determines that the international entity is just not owned at or above 50 % by listed events, it can return the license software with out motion).  BIS notes that these obligations might prolong past exporters to freight forwarders and monetary establishments, which is a notable enlargement of compliance obligations.

Cautionary Note for Cases of Minority Ownership.  Even the place the Affiliates Rule doesn’t apply, the interim final rule cautions that “significant minority ownership by, or other significant ties to (e.g., overlapping board membership or other indicia of control)” a listed entity “present[s] a Red Flag of potential diversion risk to the listed entity.”  In such circumstances, BIS expects heightened due diligence, significantly in jurisdictions with opaque possession constructions or restricted entry to correct possession information.  This doesn’t replicate a big departure from BIS’s former therapy of events minority-owned by restricted events, and it parallels OFAC steerage, which additional admonishes warning when coping with events who are usually not owned—however could also be managed—by blocked events.  (See up to date BIS Entity List FAQ 43; OFAC FAQ 398.)

III.  Applying the Affiliates Rule: Immediate Consequences and Compliance Considerations

The adoption of the Affiliates Rule is a real sea change for U.S. export controls.  It considerably broadens the scope of legal responsibility for exporters, heightens enforcement dangers, and calls for that firms adapt their compliance applications directly.  This new rule has world implications.  It impacts U.S. firms, but additionally these non-U.S. firms that deal in U.S.-origin items, expertise, or software program—or in items made, each instantly and in some circumstances not directly, with U.S.-origin elements, expertise, or software program.

The business affect of the Affiliates Rule can be substantial, as many newly restricted associates are deeply built-in into U.S. and world provide chains.  For instance, all remaining Huawei associates not previously captured by the Entity List at the moment are topic to license necessities the place they’re majority-owned by an Entity List designee and/or different listed celebration as described above, as are quite a few associates of the China National Offshore Oil Corporation (CNOOC).

Increased Compliance Burden.  The rule’s due diligence necessities impose a considerably greater screening and evaluate burden.  BIS asserts within the interim final rule that “[a]dopting the same standard that exporters, reexporters, and transferors have already been using in their OFAC compliance programs will likely ease the burden in adopting the new standard for Entity List compliance, as compared with a distinct standard that applies a lower ownership threshold.”  The actuality is extra advanced.  While refined exporters do probably have already got lots of the processes, procedures, and programs in place to conduct this diligence, on account of their present OFAC 50 Percent Rule diligence (or different know-your-customer or know-your-supplier diligence), the quantity of labor—and complexity of the evaluation—will enhance considerably.

BIS signifies that the excessive quantity of due diligence required to establish and designate associates of listed events is the idea for the rule, and—regardless of the company’s entry to data unavailable to the personal sector (similar to categorized intelligence, reporting from international embassies, and data shared by worldwide companions)—it largely shifts the burden of knowledge assortment and evaluate to business.  Many in business, in flip, will probably have to spend money on bigger diligence groups and extra complete diligence instruments—particularly if organizations wish to meet their “affirmative duty” to totally perceive their counterparty’s possession (as mentioned in Section II above).

While many third-party diligence suppliers have already up to date their screening lists to replicate possession pursuits coated by the Affiliates Rule, organizations should guarantee their instruments present this protection and that their groups are skilled to judge and disposition screening hits in opposition to this new content material.  In some circumstances, organizations may discover that they need to terminate energetic relationships with a purpose to forestall violative exports or forestall legal responsibility regarding historic gross sales.  Of notice, firms might want to contemplate dangers related to excellent restore, customer support, and guarantee obligations.

In the brief time period, this compliance burden is highest for organizations that will not be capable to reap the benefits of automated screening to refresh their diligence on all counterparties.  This could also be particularly making an attempt for organizations which have traditionally relied on rigorously crafted end-user certificates (EUCs), contractual controls, or audit rights to legally transact with associates of listed events—particularly when these counterparties, who could also be newly restricted, are oblique end-users captured on the group’s EUCs however not listed within the group’s enterprise report system, the place the group would in any other case rapidly discover and block them via automated screening.  Organizations reliant on distributors and resellers to promote their items may even have new challenges.  Such firms ought to make sure that their channel companions (usually non-U.S. firms) perceive the brand new screening obligations—to reduce threat and higher forecast oblique enterprise impacts ensuing from this rule—and may contemplate instantly rescreening their channel companions’ finish customers.

Diligence Tools Are Now More Important Than Ever.  As a operate of its advanced due diligence necessities, the rule implicitly encourages using advanced instruments designed to ship transparency concerning useful possession, considerably rising reliance on company registry analysis and third-party platforms that map possession constructions.

Some firms—particularly those who primarily present low-risk providers or who primarily make home U.S. gross sales—have traditionally relied on the U.S. Department of Commerce’s Consolidated Screening List (CSL) as their main export management and sanctions screening instrument.  While the CSL has the good thing about being an official U.S. authorities listing, this method has at all times had some downsides: incapability to point out who screened what, when, and what the screening outcomes at that second in time mirrored; incapability to hyperlink screenings on to transactions and to mechanically maintain transactions related to potential screening matches pending compliance evaluate; lack of international commerce management listing content material and of listing content material from adjoining U.S. commerce regulators, like CBP; and—as has lengthy been a problem for OFAC compliance—incapability to judge useful possession.  BIS’s FAQs explicitly state that CSL screening alone is not ample, which means that even low-volume exporters should contemplate both constructing inner ownership-tracing capability or investing in subscription-based third-party instruments or different outsourced diligence capacities.  (See up to date BIS Entity List FAQ 46.)

Because of the investigative challenges for in-house compliance groups detailed beneath, going ahead, screening platform and content material suppliers might turn into important to each working an efficient compliance program, and proving a compliance program’s sufficiency within the occasion of a disclosure or investigation.  For small and medium-sized exporters that beforehand relied solely on CSL checks, this represents a serious new value and burden.

Despite Diligence Tools, Barriers Persist.  Even utilizing superior screening platforms, firms will face obstacles to studying about possession in jurisdictions the place such data is opaque, regularly unreported, or intentionally hid.

Russia, for instance, has adopted an “anti-sanctions” measure in 2022 permitting sure listed firms to withhold in any other case necessary public disclosures concerning their relationships to associates and subsidiaries, irritating outdoors diligence.  In China the federal government has imposed inner information controls in addition to numerous counter-sanctions legal guidelines that would probably be used to justify Chinese firms’ refusals to adjust to U.S.-mandated due diligence.  Further, the Russian authorities allows personal entities which can be “currently sanctioned or under the risk of being sanctioned by third countries” to masks sure classes of knowledge in Russia’s official company registry, the Unified State Register of Legal Entities (EGRUL), together with “information about the founders or participants of the company.”

In China, public registries such because the National Enterprise Credit Information Publicity System (NECIPS) present baseline firm information however are sometimes fragmented, incomplete, and topic to state-imposed disclosure limits.  Commercial platforms are extra user-friendly, however they finally depend on the identical underlying official filings—which means they preserve the identical gaps, outdated information, or restricted disclosures.

These obstacles create systemic challenges, significantly for exporters of delicate expertise, and underscore the necessity for risk-calibrated compliance approaches that rely not solely on formal information but additionally on contextual purple flags similar to, to the extent detectable, uncommon company structuring.

Challenges for Different Business Models.  The ensuing disruption to business will create important—and considerably diverse—challenges for various enterprise fashions.  The compliance burden is not going to be felt evenly.  High-volume commodity sellers, distributors, and resellers who usually lack the power to conduct significant useful possession diligence throughout a extremely various buyer base will face significant obstacles.  Smaller and fewer refined firms, too, may struggle to satisfy the brand new commonplace, as they usually lack each the sources and built-in commerce compliance applications.  By distinction, firms with extremely specialised merchandise and a slender buyer base might face a much less impactful transition, although even they may nonetheless have to replace their processes.  Financial establishments supporting export transactions are probably comparatively nicely positioned, having already constructed refined screening programs to adjust to OFAC necessities—nonetheless, we notice rising BIS scrutiny on banks with respect to their facilitation of export management violations.

This differential affect mirrors the broader historic sample below the present EAR regime, the place smaller firms wrestle to help the price of BIS licensing (that bigger companies can handle comparatively higher).

Contractual and Deal Implications.  The Affiliates Rule may even disrupt on a regular basis contracts, M&A offers, and lending transactions, and end-use certification practices.  Counterparties will probably must revise their representations, warranties, and compliance clauses to exclude dealings with any entity 50 % or extra owned by events on any OFAC or BIS lists—on each particular person and mixture bases, and whether or not direct or oblique.  This is along with lists imposed by different world sanctions regulators who apply an analogous possession evaluate commonplace.  In many circumstances, these exclusions could also be drafted broadly (associated to the de-risking pattern mentioned beneath), with out caveating that they apply solely to sure BIS-controlled lists.  Companies might discover themselves contractually obligated to carry out possession diligence throughout a wider vary of counterparties than the Affiliates Rule strictly requires, or they might discover themselves unable to promote to finish customers who’re at the moment permitted, similar to associates of Denied Parties.  Careful, and to the extent doable, future-proofing drafting can be vital to keep away from pointless enterprise disruption.

Likely Trend Towards De-Risking.  In this vein, we count on that the market might present a broader pattern towards de-risking—in extra of the express necessities below the Affiliates Rule.  Just as banks and companies have usually chosen to “de-risk” from SDNs somewhat than try granular compliance with OFAC’s 50 Percent Rule, we consider exporters, their banks, and their freight forwarders might more and more stroll away from enterprise with Entity List events and their associates, even the place a license may technically be sought.  Given the broad item-based extraterritorial scope of the Affiliates Rule, which particularly expands the attain of two U.S. international direct product guidelines (the “Entity List” foreign direct product rule and the “Russia/Belarus-Military End User and Procurement” foreign direct product rule), even non-U.S. firms might take this method.

Notably, the rule signifies that when an affiliate of a listed celebration requests to be excluded from the scope of the Affiliates Rule—or on the End-User Review Committee’s personal initiative—an affiliate’s exclusion can be listed inside the guardian firm’s (or guardian firms’) personal itemizing.  Because many firms refuse to do any enterprise with events on any BIS restricted events listing, with out evaluating the granular controls that BIS imposes, we anticipate that except screening distributors clarify, distinct flags to signify these circumstances, due diligence analysts might conclude that excluded events are in actual fact listed, and due to this fact, restricted—with out reviewing the particular entry to identify the exclusion.

Likewise, we anticipate that some organizations will calculate the share of any SDN’s possession of a counterparty in making use of this rule, somewhat than solely calculating the share of possession by SDNs coated by the EAR in part 744.8, once more resulting in overinclusive compliance.

IV.  Conclusion

In brief, BIS’s Affiliates Rule is an instantaneous, far-reaching change that extends end-user restrictions past named events to their majority-owned international associates (tempered solely by a slender in-transit financial savings clause and, via December 1, 2025, a restricted Temporary General License).  List-checking is not ample: Companies should hint possession—direct and oblique—as much as final useful house owners, and refresh screening instruments, contractual safeguards, and supply-chain assumptions as wanted.  Third-party diligence platforms may also help, however opaque registries and information controls in jurisdictions similar to Russia and China can complicate verification.  Where any listed possession is suspected, the Affiliates Rule imposes an affirmative obligation to verify exact possession percentages or search a BIS license.  Moreover, the Affiliates Rule each aggregates possession throughout a number of listed events and applies the “Rule of Most Restrictiveness”—such that the strictest necessities circulate right down to the unlisted international affiliate.  Against the backdrop of a strict-liability regime, firms ought to proceed with warning, doc their diligence, and seek the advice of counsel to develop sensible compliance methods.

---

The following Gibson Dunn attorneys ready this replace: Audi Syarief, Lindsay Wardlaw, Chris Timura, Matt Axelrod, Adam M. Smith, David Wolber, Chris Mullen, Hui Fang, Soo-Min Chae, Sarah Pongrace, Dharak Bhavsar, Roxana Akbari, Zach Kosbie, and Erika Holmberg.

Gibson Dunn’s attorneys can be found to help in addressing any questions you will have concerning these points. For extra details about how we might help you, please contact the Gibson Dunn lawyer with whom you often work, the authors, or the next leaders and members of the agency’s Sanctions & Export Enforcement and International Trade Advisory & Enforcement follow teams:

United States:
Matthew S. Axelrod – Co-Chair, Washington, D.C. (+1 202.955.8517, maxelrod@gibsondunn.com)
Adam M. Smith – Co-Chair, Washington, D.C. (+1 202.887.3547, asmith@gibsondunn.com)
Ronald Kirk – Dallas (+1 214.698.3295, rkirk@gibsondunn.com)
Stephenie Gosnell Handler – Washington, D.C. (+1 202.955.8510, shandler@gibsondunn.com)
Donald Harrison – Washington, D.C. (+1 202.955.8560, dharrison@gibsondunn.com)
Christopher T. Timura – Washington, D.C. (+1 202.887.3690, ctimura@gibsondunn.com)
David P. Burns – Washington, D.C. (+1 202.887.3786, dburns@gibsondunn.com)
Nicola T. Hanna – Los Angeles (+1 213.229.7269, nhanna@gibsondunn.com)
Courtney M. Brown – Washington, D.C. (+1 202.955.8685, cmbrown@gibsondunn.com)
Amanda H. Neely – Washington, D.C. (+1 202.777.9566, aneely@gibsondunn.com)
Samantha Sewall – Washington, D.C. (+1 202.887.3509, ssewall@gibsondunn.com)
Michelle A. Weinbaum – Washington, D.C. (+1 202.955.8274, mweinbaum@gibsondunn.com)
Roxana Akbari – Orange County (+1 949.475.4650, rakbari@gibsondunn.com)
Karsten Ball – Washington, D.C. (+1 202.777.9341, kball@gibsondunn.com)
Sarah Burns – Washington, D.C. (+1 202.777.9320, sburns@gibsondunn.com)
Hugh N. Danilack – Washington, D.C. (+1 202.777.9536, hdanilack@gibsondunn.com)
Justin duRivage – Palo Alto (+1 650.849.5323, jdurivage@gibsondunn.com)
Zach Kosbie – Washington, D.C. (+1 202.777.9425, zkosbie@gibsondunn.com)
Chris R. Mullen – Washington, D.C. (+1 202.955.8250, cmullen@gibsondunn.com)
Sarah L. Pongrace – New York (+1 212.351.3972, spongrace@gibsondunn.com)
Anna Searcey – Washington, D.C. (+1 202.887.3655, asearcey@gibsondunn.com)
Erika Suh Holmberg – Washington, D.C. (+1 202.777.9539, eholmberg@gibsondunn.com)
Audi Ok. Syarief – Washington, D.C. (+1 202.955.8266, asyarief@gibsondunn.com)
Scott R. Toussaint – Washington, D.C. (+1 202.887.3588, stoussaint@gibsondunn.com)
Lindsay Bernsen Wardlaw – Washington, D.C. (+1 202.777.9475, lwardlaw@gibsondunn.com)
Shuo (Josh) Zhang – Washington, D.C. (+1 202.955.8270, szhang@gibsondunn.com)

Asia:
Kelly Austin – Denver/Hong Kong (+1 303.298.5980, kaustin@gibsondunn.com)
David A. Wolber – Hong Kong (+852 2214 3764, dwolber@gibsondunn.com)
Fang Xue – Beijing (+86 10 6502 8687, fxue@gibsondunn.com)
Qi Yue – Beijing (+86 10 6502 8534, qyue@gibsondunn.com)
Dharak Bhavsar – Hong Kong (+852 2214 3755, dbhavsar@gibsondunn.com)
Hui Fang – Hong Kong (+852 2214 3805, hfang@gibsondunn.com)
Arnold Pun – Hong Kong (+852 2214 3838, apun@gibsondunn.com)

Europe:
Attila Borsos – Brussels (+32 2 554 72 10, aborsos@gibsondunn.com)
Patrick Doris – London (+44 207 071 4276, pdoris@gibsondunn.com)
Michelle M. Kirschner – London (+44 20 7071 4212, mkirschner@gibsondunn.com)
Penny Madden KC – London (+44 20 7071 4226, pmadden@gibsondunn.com)
Irene Polieri – London (+44 20 7071 4199, ipolieri@gibsondunn.com)
Benno Schwarz – Munich (+49 89 189 33 110, bschwarz@gibsondunn.com)
Nikita Malevanny – Munich (+49 89 189 33 224, nmalevanny@gibsondunn.com)
Melina Kronester – Munich (+49 89 189 33 225, mkronester@gibsondunn.com)
Vanessa Ludwig – Frankfurt (+49 69 247 411 531, vludwig@gibsondunn.com)

© 2025 Gibson, Dunn & Crutcher LLP.  All rights reserved.  For contact and different data, please go to us at www.gibsondunn.com.

Attorney Advertising: These supplies had been ready for common informational functions solely primarily based on data out there on the time of publication and are usually not meant as, don’t represent, and shouldn’t be relied upon as, authorized recommendation or a authorized opinion on any particular info or circumstances. Gibson Dunn (and its associates, attorneys, and workers) shall not have any legal responsibility in reference to any use of those supplies.  The sharing of those supplies doesn’t set up an attorney-client relationship with the recipient and shouldn’t be relied upon in its place for recommendation from certified counsel.  Please notice that info and circumstances might range, and prior outcomes don’t assure an analogous end result.