Oct 7 (Reuters) – The Biden administration unveiled sweeping export controls on Friday, including a measure to cut China off some semiconductor chips made anywhere in the world with U.S. equipment, which greatly expanding its reach to reduce Beijing’s technological and military advances.
The rules, some of which take effect immediately, build on restrictions sent this year to top equipment makers KLA Corp ( KLAC.O ), Lam Research Corp ( LRCX.O ) and Applied Materials Inc ( AMAT .O), effectively needing them. to stop shipments of equipment to Chinese-owned factories that produce advanced chip chips.
The measures could be the biggest shift in US policy toward Chinese technology exports since the 1990s. If effective, they could compel China’s chip manufacturing industry by forcing American and foreign companies that use American technology to stop supporting some of China’s leading manufacturers and designers.
Register now for FREE unlimited access to Reuters.com
“This will set China back for years,” said Jim Lewis, a technology and cyber security expert at the Center for Strategic and International Studies (CSIS), a Washington D. See the article : Four ways a successful business can regularly challenge the status quo.C.-based think tank, who said the policies going back to the strict rules of the height of the Cold War.
“China won’t give up on chipmaking…but this will really slow them down.”
In a briefing with reporters Thursday on the rules, senior government officials said many of the measures are aimed at preventing foreign companies from selling advanced chips to China or providing Chinese companies with tools to make advanced chips. They admitted, however, that they did not make any promises that the allied countries would implement similar measures in dialogue with those countries.
“We recognize that the unilateral controls we are putting in place will lose their effectiveness over time if other countries do not join us,” one of the officials said. “And we risk undermining America’s technological leadership if foreign competitors are not subject to similar controls.”
The expansion of US powers to control Chinese exports of chips made in US devices is based on an expansion of the so-called foreign direct manufacturing law. It was previously expanded to give the U.S. government the power to control exports of chips made abroad by Chinese telecommunications giant Huawei Technologies Co Ltd ( HWT.UL ) and later to stop the flow of semiconductors to Russia after its invasion of Ukraine.
On Friday, the Biden administration imposed expanded sanctions on China’s IFLYTEK, Dahua Technology, and Megvii Technology, companies it added to the 2019 list of entities accused of helping Beijing control its Uyghur minority group.
The rules published on Friday also blocked shipments of various chips for use in Chinese computer systems. The rules define a supercomputer as any system with more than 100 petaflops of computing power in a space of 6,400 square feet, a definition that two industry sources said could also fit into some commercial data centers. Chinese technology companies.
Eric Sayers, a defense policy expert at the American Enterprise Institute, said the move reflects a new bid by the Biden administration to rein in China’s progress rather than simply seeking to level the playing field. the game.
“The scope of the law and the implications are incredible but the devil will of course be the details of implementation,” he added.
Companies around the world began to struggle with the latest action in the United States, as the stock of semiconductor manufacturing equipment fell.
The Semiconductor Industry Association, which represents chipmakers, said it was studying the rules and urged the U.S. to “implement the rules in a targeted manner — and work with international partners — to help level the playing field.”
Earlier on Friday, the United States added China’s largest memory company YMTC and 30 other Chinese firms to a list of companies that U.S. officials cannot inspect, raising tensions with Beijing and launching a 60-day freeze that could result in stiffer penalties. Read more
Companies are added to the non-verified list when U.S. officials cannot complete site visits to determine if they can be trusted to receive sensitive U.S. technology, forcing U.S. suppliers to exercise greater caution when sourcing them. they are leaving.
According to a new policy announced on Friday, if a government prevents US officials from conducting site inspections of companies placed on the unverified list, US officials will begin the process of adding the entities to the list after 60 days.
A YMTC listing would escalate already-escalating tensions with Beijing and force its US suppliers to seek tougher licenses from the US government before exporting even the lowest-priced products.
The new rules will also severely limit exports of U.S. equipment to Chinese memory chip makers and will formally set aside letters to Nvidia Corp ( NVDA.O ) and Advanced Micro Devices Inc ( AMD ) ( AMD. O) restricting Chinese shipments used for supercomputing. Systems that the nations of the world rely on to develop nuclear weapons and other military technologies.
Reuters first reported the key details of the new restrictions on memory equipment makers, including the suspension of foreign companies operating in China and moves to expand restrictions on Chinese shipments of technology from KLA, Lam, Applied Materials, Nvidia and AMD.
South Korea’s industry ministry said in a statement on Saturday that there would be no major disruption to Samsung’s ( 005930.KS ) and SK Hynix’s ( 000660.KS ) chip manufacturing supplies in China.
However, it was necessary to reduce uncertainty by consulting with US export control authorities, she added.
On Saturday, Chinese Foreign Ministry spokesman Mao Ning described the move as a violation of trade measures aimed at strengthening “the technological superiority of the United States”. Read more
Register now for FREE unlimited access to Reuters.com
Reporting by Stephen Nellis in San Francisco and Karen Freifeld in New York
Additional reporting by David Shepardson in Washington, Joyce Lee in Seoul and Yew Lun Tian in Beijing This may interest you : Metatron Announces Deal with Good Karma Global Health and Lifestyle Company.
