Affiliates Rule
A BIS rule that extends the restrictions on parties on US export control lists to any company they own 50% or more of, directly or indirectly, even if that company is not listed.
How it works
The Affiliates Rule is an interim final rule that the Commerce Department's Bureau of Industry and Security (BIS) published in the Federal Register on 30 September 2025, effective from 29 September 2025. It automatically subjects any entity owned at least 50%, directly or indirectly, individually or in the aggregate, by one or more parties on the Entity List to the same restrictions.
Before the rule, restrictions applied only to entities named on the list, so an unlisted affiliate of a listed company could keep buying US goods. BIS borrowed the 50% threshold that the Treasury's Office of Foreign Assets Control (OFAC) has long applied to its sanctions list. The same threshold covers parties on the Military End-User (MEU) List and certain sanctioned parties specified in the EAR.
The rule shifts a due-diligence burden onto exporters. A firm that knows a buyer has a listed owner must establish the ownership percentage; if it cannot, it must resolve that red flag before shipping or apply to BIS for a licence. The restrictions apply on a strict liability basis, so an exporter can breach them without knowing it.
In a rule published on 12 November 2025, BIS suspended the Affiliates Rule from 10 November 2025 to 9 November 2026. The same text provides that, absent a further extension, the rule returns automatically on 10 November 2026.
Why it matters here
The rule targets the biggest gap in export controls on China: listed companies sourcing goods through unlisted affiliates. Its suspension is part of the US–China trade truce. The US Treasury Secretary said on 23 September 2026 that the truce had been extended to 10 January 2027, but as of 2 October no Federal Register notice showed the extension applying to this rule. Without one, the rule returns on 10 November and ownership chains on chip and equipment shipments to China will be screened again. Turkish firms face the same question: a sale to the affiliate of a Chinese partner may need a licence.