Removal from Validated End User Authorization
The U.S. Department of Commerce's Bureau of Industry and Security (BIS) announced a final rule on August 29, 2025, strengthening export controls on semiconductor manufacturing equipment and related technologies destined for Chinese facilities of Intel, Samsung Electronics, and SK Hynix. The three Chinese facilities will be removed from the Validated End User (VEU) list under the U.S. Export Administration Regulations (EAR) effective December 31.
Target Chinese facilities:
- Intel Semiconductor (Dalian)
- Samsung China Semiconductor
- SK hynix Semiconductor (China)
VEU System Overview and Impact
VEU mechanism: Foreign end users certified by the Commerce Department as not posing a threat to U.S. national security interests. As of August 2025, seven facilities of U.S. and Korean companies in China and one U.S. company facility in India are certified. VEUs can export, re-export, or transfer specific items without obtaining individual export licenses.
Practical impact of changes: Future exports to the three Chinese facilities will require individual license applications and approvals. BIS indicated its review policy will approve applications necessary for maintaining existing facility operations while denying applications that would expand production capacity or improve technological capabilities.
Trump Administration Policy Stance
BIS characterized the VEU system as a "loophole under the previous Biden administration" in this announcement. Under Secretary of Commerce Jeffrey Kessler (Industrial Security) stated: "The Trump administration is committed to addressing export control loopholes, particularly those that undermine U.S. corporate competitiveness. Today's decision is an important step in fulfilling this commitment."
Easing of Export Controls to Syria
Background for easing: BIS announced a final rule on August 28 partially easing export controls to Syria. This measure is based on President Donald Trump's executive order on Syria sanctions relief announced in June 2025.
Specific easing measures:
- Establishing new exceptions that eliminate the previously mandatory license application requirement for EAR99-classified items (not included in the Commerce Control List) destined for Syria
- Expanding the scope of exceptions that make individual licenses unnecessary for exports of specific items such as civilian communication equipment to include Syria
VEU status remains unchanged for Chinese and Indian facilities of other U.S. companies not among the three targeted companies.