BIS Seeks Comments on The Global Semiconductor Shortage

As the global semiconductors shortage continues to hurt supply chains across many key industries, the United States is working hard to understand existing supply chain vulnerabilities. In February, President Biden issued Executive Order 14017 on “America's Supply Chains,” directing several federal agencies to secure and strengthen America's supply chains. The Bureau of Industry (BIS) led the 100-Day Supply Chain Review of semiconductors that was mandated by the Executive Order. Unsurprisingly, this review identified several supply chain vulnerabilities. In addition to the long-term goals such as strengthening the domestic semiconductor manufacturing ecosystem and promoting U.S. industry leadership, this report asked the Department of Commerce to partner with industry and facilitate an information exchange between semiconductor producers and suppliers and end-users to address the current semiconductor shortage. To this end, BIS is now seeking responses from interested parties to increase information flow across different segments of the supply chain, isolate data gaps and bottlenecks, and identify potential inconsistent demand signals.

While BIS is inviting input from any interested parties, the agency is particularly interested in hearing from foreign and domestic entities that actively participate in the semiconductor product supply chain at any level ( e.g., semiconductor design, front end semiconductor wafer fabrication, semiconductor assembly test and packaging, microelectronics assembly, intermediate and end-users of semiconductors and microelectronics, distributors of such products, as well as entities supporting semiconductor and microelectronics manufacturing as providers of materials and equipment). There are several types of information and data the agency is looking for including, among others:

The technology nodes (in nanometers), semiconductor material types, and device types that an organization can provide;

Sales data for integrated circuits;

The largest order backlog for semiconductor products;

Top customers;

Typical and current inventory for the organization's top semiconductor products;

The primary disruptions or bottlenecks;

Methods of allocating the available supply;

Any product limitation due to lack of available semiconductors;

Any new investments being made to mitigate semiconductor sourcing difficulties;

The types of semiconductor product that are most in short supply;

As much of the information BIS hopes to gather is business proprietary information, the agency notes that such information will not be published, provided submitters follow the instructions for submitting confidential business information in the public comments. Comments are due November 8, 2021.

If you are an interested party and would like to provide comments to BIS on the global semiconductors shortage or have questions about the comment process, please do not hesitate to contact an attorney at Barnes, Richardson & Colburn, LLP.

On September 17, 2021, President Biden issued an Executive Order declaring a national emergency in response to the ongoing situation in northern Ethiopia, a move which has now paved the way for the US Department of the Treasury to impose sanctions on a variety of parties, both in Ethiopia and beyond. In declaring a national emergency, the administration has cited the International Emergency Economic Powers Act (IEEPA), the National Emergencies Act (NEA), the Immigration and Nationality Act of 1952, and 3 U.S. Code Section 301.

Pursuant to the Order, President Biden has now authorized the Secretary of the Treasury to impose sanctions on any foreign person determined by the Secretary of the Treasury, in consultation with the Secretary of State, who is found to be responsible for or complicit in, or to have directly or indirectly engaged or attempted to engage in a variety of activities that “threaten the peace, security, and stability of Ethiopia and the greater Horn of Africa region.” Examples of sanctionable activities include engaging in actions or the creation of policies that threaten the peace, security, or stability of Ethiopia; corruption or serious human rights abuse in or with respect to northern Ethiopia; obstruction of the delivery or distribution of, or access to, humanitarian assistance; and the targeting of civilians through the commission of acts of violence in or with respect to northern Ethiopia. A full list of sanctionable actions can be found in section 1(a)–(h) of the Order.

The move to establish a new Ethiopia sanctions regime comes as the country has experienced persistent and bloody fighting following the outbreak of a civil war in November of 2020, a war which has now taken more than 10,000 lives. While the primary conflict is between the Tigray Regional government in northern Ethiopia and the Ethiopian National Defense Force based in the capital city of Addis Ababa, the Tigray region has reportedly been under siege from Ethiopia’s norther neighbor Eritrea as well. The conflict has created to a dangerous humanitarian crisis, with the UN estimating that millions of civilians are currently in need of emergency assistance. Over the past 11 months grave war crimes have reportedly been committed by all sides, with the Biden administration making sure to put all parties to the conflict on notice, stressing that sanctions will apply to anyone fitting the designated sanctions criteria, regardless of their role in the conflict.

In an open letter to President Biden posted on Twitter, the Ethiopian Prime Minister Abiy Ahmed lamented what he described as President Bidens “failure to see his campaign in Tigray as an extension of the global war on terror,” accusing Washington of engaging in “an orchestrated distortion of events and facts on the ground.” While the ultimate scope of sanctions imposed under this Order remains to be seen, this Order nonetheless introduces a new layer of complexity for those who engage in business in the region or who engage with or have ties to those who may later become subject to these sanctions.

If you have any questions regarding US sanctions do not hesitate to contact an attorney at Barnes, Richardson & Colburn LLP.

Federal Register Notices

Monday, September 20, 2021- Vol. 86, No. 179