HR6331-119

What This Bill Does

The ADVERSARIES Act amends the Export Control Reform Act of 2018. It changes the definition of covered person so the term includes entities identified under section 1260H(a) of the FY2021 National Defense Authorization Act as Chinese military companies, entities on the BIS Entity List, entities on the BIS Military End User List, and subsidiaries or affiliates owned 50 percent or more by those listed entities. The bill also removes the word "foreign" from a related definition, widening how the covered-person concept can operate.

The practical effect is to make listed Chinese military, Entity List, Military End User List, and majority-owned affiliate entities easier to capture in export-control decisions. Exporters and researchers dealing with advanced technology would need to screen not only named restricted entities but also subsidiaries and affiliates with 50 percent or greater ownership by a restricted entity.

Who Benefits and How

BIS licensing staff benefit from clearer statutory links to the 1260H Chinese military company list, Entity List, Military End User List, and majority-owned affiliates. Defense technology security officials benefit because covered-person definitions reach more entities connected to strategic adversaries. U.S. semiconductor exporters benefit from clearer screening categories when deciding whether exports need controls. National security agencies benefit from broader statutory coverage of restricted entity networks.

Who Bears the Burden and How

Chinese military companies face higher export-control barriers. BIS Entity List organizations face continued or expanded barriers under the definition. BIS Military End User List organizations face the same covered-person treatment. Restricted-entity subsidiaries with 50 percent ownership face compliance and licensing barriers even if not separately named. U.S. exporters and university research offices must screen ownership and affiliate relationships more carefully.

Key Provisions

• Amends the Export Control Reform Act definition of covered person.
• Adds entities identified as Chinese military companies under section 1260H(a).
• Adds BIS Entity List organizations and BIS Military End User List organizations.
• Adds subsidiaries or affiliates owned 50 percent or more by listed entities.
• Removes the word "foreign" from a related definition to widen export-control coverage.