US Business Faces Huge Delays in Permission for Doing Business with China

[ABS News Service/12.08.2026]

US companies are facing lengthy and increasingly unpredictable waits for permission to export controlled products to China, costing some businesses hundreds of millions or even billions of dollars, according to a new industry survey.

The US-China Business Council survey found that 95 percent of respondents identified long review times as a major challenge. Seventy-one percent said they had experienced delays obtaining licenses for products bound for Chinese customers.

Two-thirds reported applications pending for at least three months, while 31 percent said some licenses had remained unresolved for one to two years. Before the second Trump Administration, 56 percent said comparable applications were typically reviewed within one to three months.

The findings suggest that the delays may be weakening US suppliers without necessarily preventing China from obtaining comparable goods. Eighty-two percent of companies with pending applications said Chinese customers could source substitute products from Chinese or other international suppliers.

Nearly three-quarters said licensing delays had caused sales to shift to Chinese competitors. Fifty-five percent reported losing business to international rivals, and 64 percent said they had surrendered market share in China.

Substantial Cost

More than one-third of respondents estimated that delayed decisions had cost their companies at least tens of millions of dollars. Several reported losses reaching hundreds of millions or billions of dollars, according to the council.

The USCBC, which represents US companies doing business with China, said the lost revenue could reduce the money available for research, development and international expansion – potentially undermining the technological and economic advantages the controls are intended to protect.

The survey also points to a sharp deterioration in confidence in the licensing system. Only 30 percent of respondents believed the Commerce Department’s Bureau of Industry and Security followed its established procedures and timelines to a moderate or great extent. The figure was 47 percent for other agencies involved in export reviews.

Citing BIS reports to Congress, the council said the bureau’s average license-processing time rose from 38 days in 2023 to 62 days in 2025, while the number of applications processed declined by nearly 20 percent. Federal regulations set out the procedures and timelines governing export-license reviews, although individual cases can require additional interagency or intelligence checks.

Companies cited poor communication from licensing officers, unclear interpretations of regulations and growing reliance on nonstandard measures such as “is informed” letters, which can impose licensing requirements on particular transactions. Some respondents said they could not reach licensing officials by telephone or obtain clarity about the reach of the Foreign Direct Product Rule.

The report also highlights concern about the suspended Affiliates Rule, which would extend restrictions to businesses at least 50 percent owned by entities on the Entity List or Military End-User List. Eighty-five percent of respondents said reinstating the rule would have a moderate or severe effect on their operations.

Industry-government engagement has also declined, according to the survey. Half of respondents identified the lack of Technical Advisory Committee meetings as a procedural problem, while 45 percent cited limited outreach from the Commerce Department. Thirty-five percent reported delays involving deemed-export licenses, which are required for certain transfers of controlled technology or source code to foreign nationals in the United States.

The survey was conducted in July and drew responses from 31 companies, primarily in technology, manufacturing, energy and healthcare. Some questions had only 20 to 29 responses. The small, industry-based sample means the findings should be viewed as a snapshot of affected businesses rather than a representative measure of all US exporters.

The report did not include a response from the Commerce Department or independently assess the national-security considerations behind individual licensing decisions.

Still, the results add to pressure on Washington to make export controls more predictable and better coordinated with allies. The council argues that restrictions offer little strategic benefit when Chinese customers can readily obtain comparable products elsewhere – and may instead accelerate their shift away from US suppliers.