The Commerce Entity List is a trade restriction tool run by the U.S. Department of Commerce that names foreign persons, companies, and organizations you cannot export, reexport, or transfer regulated items to without a specific license from the government. If a customer, freight forwarder, end user, or any other party to your transaction appears on the list, or is 50 percent or more owned by someone who does, your shipment stops until you either secure a license or walk away. Violations carry administrative fines up to $374,474 per shipment and criminal penalties up to 20 years in prison.
The list sits at 15 CFR Part 744, Supplement No. 4, and is maintained by the Bureau of Industry and Security under the Export Administration Regulations.1eCFR. Supplement No. 4 to Part 744, Title 15 The statutory backbone is the Export Control Reform Act of 2018, 50 U.S.C. §§ 4801–4852. Because the list is administrative, no criminal conviction is needed before a party lands on it. Commerce can act on intelligence or a pattern of concerning conduct, which is why the list changes often and screening cannot be a one-time exercise.
Who Ends Up on the List
Commerce adds an entity when it has “reasonable cause to believe, based on specific and articulable facts,” that the party is involved in, or poses a significant risk of becoming involved in, activities contrary to U.S. national security or foreign policy interests. Section 744.11 lays out the grounds: developing or spreading weapons of mass destruction, supporting terrorism, violating human rights standards, and facilitating illegal transshipment of controlled goods.2eCFR. 15 CFR 744.11 – License Requirements That Apply to Entities Acting or at Significant Risk of Acting Contrary to the National Security or Foreign Policy Interests of the United States
The reach has expanded well beyond traditional weapons work. A March 2025 Bureau of Industry and Security action added parties involved in advanced artificial intelligence, supercomputers, high-performance AI chips, and quantum technology tied to foreign military programs, along with entities pursuing hypersonic weapons or exascale computing.3Bureau of Industry & Security. Commerce Further Restricts China’s Artificial Intelligence and Advanced Computing Capabilities A software company, a semiconductor foundry, or a research institute can now find itself listed if its work supports a foreign government’s military-industrial complex, even without any direct weapons business.
The 50 Percent Ownership Rule
Restrictions do not stop at the named entries. Any foreign entity owned 50 percent or more, directly or indirectly, by one or more listed parties is automatically subject to the same license requirements as its owner.4Federal Register. Expansion of End-User Controls To Cover Affiliates of Certain Listed Entities The rule closes the obvious loophole of routing shipments through subsidiaries or shell companies.
When multiple listed parties jointly own a subsidiary, the “rule of most restrictiveness” applies: the subsidiary faces whichever license requirements, review policies, and license exception limitations are most restrictive among its owners. If you cannot pin down the ownership percentage of a foreign counterparty that might be partly owned by listed entities, treat the uncertainty itself as a red flag. Resolve the concern or apply for a license before shipping.5Cornell Law Institute. 15 CFR Appendix Supplement No. 4 to Part 744 – Entity List
What the License Requirement Actually Means
Once a party is listed, exports, reexports, and in-country transfers of items subject to the Export Administration Regulations require a license. Each entry in Supplement No. 4 spells out the scope: which items trigger the requirement, and which license exceptions, if any, remain available.6Bureau of Industry and Security. Entity List
Most entries also specify a license review policy telling Commerce how to evaluate applications. The most common is a “presumption of denial,” meaning the government starts from the intent to reject. Only exceptional facts overcome it. Some entries carry a “case-by-case” policy for certain lower-tier items, but applicants should not assume approval on anything sensitive.
Footnote Designations Extend the Reach Overseas
Some entries carry footnote designations that broaden restrictions beyond items normally subject to the Export Administration Regulations. Footnote 1 entities face restrictions on foreign-produced items, so goods made outside the United States can require a license if they incorporate certain controlled U.S. technology or software. Footnote 4 entities face an even broader foreign-produced item rule. If you manufacture abroad using American design tools, chips, or software, a footnote designation on your customer can still pull your shipment into the license regime.6Bureau of Industry and Security. Entity List
Screening Before Every Shipment
Every U.S. exporter has an affirmative duty to screen transaction parties before shipping. The International Trade Administration runs a free Consolidated Screening List search tool that checks the Entity List and the other major restricted party lists at once.7International Trade Administration. Consolidated Screening List Screen before you onboard a new customer, before each shipment, and again whenever the list is updated.
Commerce’s “Know Your Customer” guidance, at Supplement No. 3 to Part 732, lists the red flags that should trigger additional due diligence: customers who are evasive about end use, buyers whose business does not match the product ordered, unusual shipping routes, and customers who decline standard installation or training services.8eCFR. Supplement No. 3 to Part 732, Title 15 – BIS’s Know Your Customer Guidance Ignoring a flag does not create a safe harbor. If the facts point to a listed party and you ship anyway, Commerce can treat that as a knowing violation.
Penalties
Shipping regulated items to a listed party without a license carries serious consequences on both sides of the enforcement line. Administratively, the Bureau of Industry and Security can impose fines up to $374,474 per violation or twice the transaction value, whichever is greater. The cap is adjusted annually for inflation.9Bureau of Industry and Security. Penalties
Criminal penalties are steeper. Under the Export Control Reform Act, a willful violation can bring fines up to $1,000,000 per violation, up to 20 years in prison, or both.10Office of the Law Revision Counsel. 50 USC 4819 – Penalties
Commerce can also issue a denial order that strips a company of all export privileges. A denial order suspends or revokes outstanding licenses, blocks future exports, and prevents the named party from benefiting from any transaction involving items subject to the Export Administration Regulations.11eCFR. 15 CFR 764.3
If You Have Already Shipped
If you find out that a past shipment went to a listed party without a license, file a voluntary self-disclosure with the Bureau of Industry and Security. Commerce treats voluntary disclosures as a significant mitigating factor when setting penalties. For minor or technical violations without aggravating circumstances, the Bureau uses a fast-track resolution process that can result in a warning letter or a no-action letter within 60 days of the final submission.12Bureau of Industry and Security. Voluntary Self-Disclosure
Getting Off the List
A listed entity, or the owner or operator of a listed address, can submit a written request for removal or modification to the Chair of the End-User Review Committee at the Bureau of Industry and Security. An entity that is captured only because of 50 percent ownership can ask that its owner’s entry be modified to exclude it.13eCFR. 15 CFR 744.16
The regulations allow removal when the entity “is no longer engaged in the activities described” and “is unlikely to engage in such activities in the future.”2eCFR. 15 CFR 744.11 – License Requirements That Apply to Entities Acting or at Significant Risk of Acting Contrary to the National Security or Foreign Policy Interests of the United States Getting off is harder than getting on: adding an entity requires only a majority vote of the interagency End-User Review Committee, while removing or modifying an entry requires unanimous agreement. Any single voting agency can block a removal.14Cornell Law Institute. 15 CFR Appendix Supplement No. 5 to Part 744 – Procedures for End-User Review Committee Entity List and Military End User (MEU) List Decisions The regulations do not set a fixed deadline for a decision; when the committee finishes, the Deputy Assistant Secretary for Export Administration communicates the outcome in writing as final agency action.
How the Entity List Differs From Other Restricted Party Lists
The Entity List is one of several government lists, and the same foreign party can appear on more than one. The consequences are not the same across them.
- The Denied Persons List, also maintained by the Bureau of Industry and Security, names parties whose export privileges have been revoked entirely. Transactions with denied persons are flatly prohibited, not just subject to a license requirement.15Bureau of Industry and Security. Guidance on End-User and End-Use Controls and U.S. Person Controls
- The Unverified List covers foreign parties the Bureau could not verify in prior transactions. You can still deal with them, but you must obtain a signed statement from the party and file an Automated Export System record for all exports, and no license exceptions are available.
- The Specially Designated Nationals List, maintained by Treasury’s Office of Foreign Assets Control, is the broadest. U.S. persons are barred from any transactions with SDNs and must block property in which an SDN has an interest.16Office of Foreign Assets Control. FAQ 56
- The Military End User List, also from the Bureau of Industry and Security, triggers license requirements for items in Supplement No. 2 to Part 744 when a listed military end user is a party to the transaction.
The Consolidated Screening List tool checks all of these at once, which is the most efficient starting point for any compliance check.7International Trade Administration. Consolidated Screening List