US Weighs Curbs on China‑Bound Goods Made with American Software

Overview

The United States is reportedly weighing a sweeping plan to curb exports to China of items that are made with, or contain, U.S. software. If adopted, the move would extend Washington’s reach beyond chips and into a broader set of products and industries, leveraging the ubiquity of American software across design, manufacturing, and device firmware.

What changed

• Scope under discussion: Coverage could include laptops, networking gear, industrial equipment, and other products built or configured using American software stacks.
• Context: The idea follows Beijing’s expanded rare‑earth export curbs and recent U.S. debates over 100% tariffs and software of concern.
• Status: Deliberations are ongoing; officials may choose a narrower, targeted approach—or use the threat for diplomatic leverage.

How enforcement could work (software‑centric FDPR)

Washington can extend the Foreign Direct Product Rule (FDPR) and EAR licensing to cover categories of software and cloud services. Practical levers include:

1. License requirements for software updates, SDKs/PDKs, and cloud build pipelines tied to China‑destined goods.
2. Entity listings and compliance attestations (SBOMs, signed firmware, cloud identity controls).
3. Allied alignment with Japan/EU/Korea on a shared “software‑of‑concern” list and audit standards.

Who gets hit—and who benefits

• At risk: Chinese OEMs and global suppliers whose EDA/CAD, firmware SDKs, compilers, or DevOps stacks depend on U.S. software.
• Operational friction: Multinationals face dual toolchains, re‑engineering costs, and slower release cycles for China SKUs.
• Potential winners: U.S./ally vendors in EDA (Siemens, Synopsys, Cadence), cloud and cybersecurity, and trusted manufacturing.

How the U.S. can extend its software advantage

1. Codify a software‑FDPR playbook: Clear tests for coverage and safe harbors for low‑risk categories.
2. Cloud leverage: Tie export permissions to cloud identity, model weights governance, and continuous compliance reporting.
3. Maintain chokepoints: Keep lead in EDA, compilers, SDKs, firmware toolchains; require licensing for sensitive updates.
4. Allied coordination: Expand shared lists and reciprocal audits to reduce circumvention.
5. Resilience offsets: Support on/near‑shoring for components most exposed to China‑centric supply chains.

Scenarios to watch (30–90 days)

• Signal only: Companies pre‑emptively tighten export screening and amend software licenses.
• Targeted: License requirements on specific software features (e.g., firmware/SDKs for critical infra or high‑end EDA modules).
• Sweeping: Broad software‑FDPR designation that forces rapid vendor diversification for China‑destined goods.

References / Sources

• Reuters — US considering curbs on exports to China made with US software (Oct 22, 2025).
• Channel NewsAsia — US weighs sweeping export curbs on China‑made goods using American software (Oct 22, 2025).
• Reuters — US business lobby urges rollback of new curbs; policy context (Oct 20, 2025).