Foreign Direct Product Rule
A provision of the US Export Administration Regulations (EAR) that extends US export-control jurisdiction over certain foreign-made products produced using US-origin technology or software — even where the finished product contains no US-origin physical content.
The Foreign Direct Product Rule (FDPR) extends US reach beyond the de minimis threshold framework. Where de minimis determines jurisdiction based on US-origin content in the finished product, the FDPR determines jurisdiction based on whether US-origin technology or software was used in the production process of the finished product. The two mechanisms run in parallel, with the FDPR capturing transactions the de minimis framework would not.
The FDPR has expanded sharply in scope since 2020, with successive expansions targeting semiconductor exports to China, certain dual-use technology categories, and Russian-end-use restrictions. For Israeli industry, FDPR exposure is operationally relevant in two contexts: where Israeli manufactured systems were produced using US-origin design software or fabrication equipment, and where Israeli technology is being licensed for foreign production using US-origin tools or know-how.
The FDPR is one of the most aggressive extraterritorial provisions in the US export-control regime, and its expanding scope is a continuing feature of the Israeli-US industrial relationship that Israeli manufacturers track closely.
Sources: US Bureau of Industry and Security; Export Administration Regulations §734.9; published trade-compliance commentary. Data current as of Q2 2026.
Read Next in The Olam: Strategic Technology Trade · EAR · De minimis threshold · The US Export-Control Regime and Israeli Dual-Use Technology