New BIS 50 Percent Rule and End-User Screenings: What Companies Need to know and do now
Export controls are evolving. A new rule issued by the U.S. Bureau of Industry and Security (BIS) is significantly reshaping the sanctions landscape. Companies with business ties to the U.S. should update their screening processes by November 2025 at the latest. This article explains why and how to stay ahead.
What’s Behind the New “50 Percent Rule”?
The BIS rule shifts the focus from simple name checks to the analysis of ownership and control structures. Moving forward, companies will be considered sanctioned if designated parties directly or indirectly own or control 50% or more. Even if those companies are not explicitly listed.
What Does This Mean in Practice?
Joint ventures, subsidiaries, and complex ownership structures will now increasingly fall under the scope of export control regulations.
Why Was the Rule introduced?
The goal is clear: to close loopholes that previously allowed sanctioned entities to gain access to sensitive goods, technologies, or financial resources. The new rule reflects stronger international coordination between U.S. authorities (such as BIS and OFAC) and the EU.
What Does This Mean for Your Company
Any organization subject to U.S. export control regulations must update its partner and customer screening processes by the end of November 2025.
Key Points:
Introduction of a 60-day transition period via a Temporary General License (TGL)
Future screenings must account for beneficial ownership and control relationships
Higher demands on data quality and screening technology
End-User Screenings are gaining Importance
In parallel with the 50 Percent Rule, end-use screenings are becoming increasingly relevant. These do not focus on ownership or control, but on whether goods are used for military purposes.
This includes:
Military End Uses (MEU): Entities using goods for military applications, even if not on a sanctions list
Military Intelligence End Uses (MIEU): Entities supporting or affiliated with military intelligence operations
New Data Content for M.SecureTrade in preparation
Some indirect provision prohibitions can already be detected in M.SecureTrade's sanctions screening by using SCO list data. Available directly M.SecureTrade Sanctioned Party List Screening
Mercoline is actively working with partners to integrate new data content for both indirect sanctions and end-user screenings. These updates will be available soon through future software releases of M.SecureTrade.
What does this mean for you as a user Company?
You’ll soon be able to screen even more comprehensively and automatically to determine whether business partners or end users are subject to sanctions or usage restrictions.
Conclusion: Take Action now to ensure compliance
The new BIS rule is a clear wake-up call for companies: screening can no longer be a mere formality. With powerful add-ons like M.SecureTrade and the right data content, your company will be well equipped to meet the latest compliance demands.