US Entity List
A US Commerce Department list requiring a license, usually denied, for any export of US goods and technology to listed companies; it also reaches products made outside the United States.
The Bureau of Industry and Security of the US Commerce Department keeps a list of foreign companies, organizations and individuals whose activities it considers contrary to US national security or foreign policy. Listing does not freeze assets, unlike Treasury sanctions: it requires a license for any export, re-export or transfer to the entity of goods, software and technology subject to US export law, and the license is usually denied. Its reach goes beyond US borders. The so-called foreign direct product rule extends control to products made abroad using US technology or equipment, which in 2020 made it possible to cut a major Chinese equipment maker off from chips produced by non-US foundries. The list has been used against spyware vendors, surveillance companies and semiconductor players. For a European company, the issue is the supply chain: selling a listed entity a product containing a share of US technology may be a violation. For insurance, it bears on the compliance of trade credit and cargo programs, and creates a contractual political risk: a customer or supplier can become untouchable overnight.
Textbook case: a German sensor maker learns that one of its Chinese customers has just been added to the list. Its sensors contain a chip designed with US software: it suspends deliveries, and its credit insurer cuts the limit on that customer to zero, leaving outstanding receivables uncertain.
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