On Monday, December 2, the United States launched a large-scale operation against Chinese chip companies and chip equipment manufacturers, including adding 140 Chinese companies and their overseas entities to the Commerce Department’s blacklist and restricting the export of cutting-edge chips and chip manufacturing equipment to China. This marks the third restriction action the US has taken against the Chinese chip industry in the past three years.
Here are the details of the major actions compiled by Reuters on the Commerce Department’s recent move.
The US will implement new controls on semiconductor manufacturing equipment needed to produce cutting-edge node integrated circuits, including certain etching, deposition, lithography, ion implantation, annealing, metrology and inspection, as well as cleaning tools.
This may affect US chip equipment companies such as Lam Research, KLA Corporation, Applied Materials, as well as the Dutch semiconductor equipment manufacturer ASM International.
New controls will be implemented on software tools used for developing or producing cutting-edge node integrated circuits, including software that enhances the productivity of cutting-edge machine production or allows non-cutting-edge machines to produce advanced chips.
This may impact companies like Siemens, which is the parent company of the semiconductor software company Mentor Graphics.
The US will restrict the export of High Bandwidth Memory (HBM) used in AI chips to China.
“HBM 2” and higher versions of memory chips produced by South Korea’s Samsung, SK Hynix, and US-based Micron Technology will be included in this restriction.
Industry insiders expect only Samsung Electronics to be affected. Analysts estimate that about 30% of Samsung’s HBM chip sales come from China.
HBM is crucial for large-scale AI training and inference and is a key component of advanced computing integrated circuits.
The US will add 140 Chinese entities to the Commerce Department’s Entity List, including semiconductor manufacturing plants (also known as wafer fabs), semiconductor tool companies, and investment firms, stating that “they act in accordance with Beijing’s requirements to advance China’s goal of advanced chips, posing a threat to the national security of the US and its allies.”
Two major Chinese private equity firms, Wise Road Capital and JAC Capital in Beijing, were also listed for the first time on the Entity List.
Chinese tech companies listed on the blacklist include Wingtech Technology Co and Semiconductor Manufacturing International Corporation (SMIC), among others. The list also includes the Institute of Microelectronics of the Chinese Academy of Sciences and Zhangjiang Laboratory on the export restriction list.
Chinese chip equipment manufacturers affected by the new export controls include Naura Technology Group, Piotech, and SiCarrier Technology.
Foreign companies seeking to ship to entities on the list are typically denied when applying for a license from the US Commerce Department.
The new rules issued on Monday will expand US authority to curb American, Japanese, and Dutch manufacturers from exporting chip manufacturing equipment produced in other parts of the world to certain chip factories in China.
Equipment manufactured in Israel, Malaysia, Singapore, South Korea, and Taiwan will also be constrained by the rule, while Japan and the Netherlands will be exempt.
The expanded Foreign Direct Product Rule will apply to 16 companies on the Entity List. These companies are among the most advanced in terms of scale and technology in chip manufacturing in China.
The rule also lowers the threshold for triggering US regulation under the Foreign Items Rule. This will allow US regulation of any items shipped from overseas to China as long as they contain any American chips.
(Based on reporting by Reuters)