The Bureau of Industry and Security (BIS) has recently paused the processing of new export license applications, leading to significant delays. This pause, which affects applications submitted after February 5, 2025, has raised concerns about the impact on business. The pause is part of an internal review of licensing policies initiated by Undersecretary Jeffrey Kessler and other officials.
No formal announcement has been made regarding the expected duration of this pause, leaving the industry without clear standards for processing applications. Industry officials express concern that these delays could negatively impact American companies and their ability to operate effectively.
Under Secretary of Commerce Jeffrey Kessler
Jeffrey Kessler, was appointed Under Secretary of Commerce for Industry and Security under President Donald Trump. His focus, to this point has been on reforming the Bureau of Industry and Security (BIS) to enhance United States national security, particularly regarding advanced American technologies and export controls related to China. He has also faced scrutiny over budget requests and the effectiveness of existing regulations like the AI Diffusion Rule.
Kessler has defended the Bureau of Industry and Security’s (BIS) budget request, which seeks a 50% increase. He plans to hire nearly 200 additional Export Enforcement Special Agents and expand the number of Export Control Officers stationed overseas.
Kessler’s actions have been driven in part by criticism of the BIS for failures in safeguarding national security and preventing adversaries from accessing critical defense goods and technologies. This includes a lack of transparency in license approval rationale in cases where sensitive technologies have been sold to China despite a publicly stated presumption of denial policy.
An Uncertain Road Ahead
BIS license delays are a subject of concern and apprehension for US businesses involved in export transactions. There have been notable reductions in public statements from the agency since the beginning of the Trump administration. Previous to Kessler’s leadership, license applications took, on average, 28 days for approval.
Other concerns have been voiced over Kessler’s micromanagement approach delaying drafted changes to the Export Administration Regulations (EAR) and appointment of necessary personnel within the bureau. The Bureau of Industry and Security (BIS) has faced several challenges and shortcomings. These have included enforcement activities being hampered by outdated technologies and insufficient resources, underinvestment in technology, lack of proactive initiatives, and limited coordination with the Department of Defense Trade Controls (DDTC).
While it is important that the BIS no longer “rubber stamp” license approvals, frustration among exporters could be eased by increased communications. Many license approvals to allied countries are occurring and, according to Reuters, communications with some companies is being maintained.
CVG Strategy Export Compliance Expertise
The DDTC, the BIS, and the OFAC, along with international partners have greatly increased their activities in the generation and enforcement of regulations. This increases the likelihood of a non-egregious violation occurring even in a company with a well-run export compliance program. CVG Strategy can assist organizations through the Voluntary Self Disclosure process and guide you through these difficult procedures.
If you are part of a large corporation or a small company with a part-time compliance person, CVG Strategy has the compliance and training programs to help you meet International Traffic in Arms Regulations (ITAR) and Export Administration Regulations (EAR) rules and requirements. As the BIS place controls on a growing number of technologies it becomes increasing difficult for smaller businesses to stay abreast of regulatory developments. Because of this, we provide Export Compliance Management Programs (ECMP) for businesses of all sizes.
CVG Strategy, LLC is recognized the world over as the premier provider of Export Compliance Consulting and Export Compliance Programs for businesses involved in export in the U.S. and Canada. We also provide the essential training that ensures that your team is up to date on governmental regulations, including the Export Administration Regulations (EAR), the International Traffic in Arms Regulations (ITAR), the Canadian Controlled Goods Program, and Office of Foreign Asset Controls (OFAC) and other regulatory agencies and more.