Trade Tensions: US Restricts Tech Exports to China’s Biggest Semiconductor Manufacturer

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The United States’ commerce department fears that tech exports to China’s biggest semiconductor manufacturer might benefit the Chinese military

The Donald Trump (President, USA) led USA administration has imposed new export restrictions of tech for semiconductor manufacturing. The United States, in these new restrictions, have been announced keeping Semiconductor Manufacturing International Corp (SMIC) in consideration. SMIC is China’s biggest semiconductor manufacturer.

First reported by the Washington Post, the media house noted that it has reviewed a latter issued by the agency in the same regard. The United States’ commerce department fears that tech exports to China’s biggest semiconductor manufacturer might benefit the Chinese military.

New mandates order license route

As per the new mandate, companies exporting tech to SMIC, will now have to acquire a license from the United States administration in order to continue doing the same. Several China-based semiconductor manufacturers including SMIC, rely on software and machinery provided by the companies headquartered in the United States.

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SMIC, freshly added to the Entity List prepared by the United States administration, had started as a private company. The Entity List now has approximately 300 names.

SMIC, had released a statement recently that had read, “SMIC solemnly declares that the Company, a public company listed on the Hong Kong Stock Exchange and the Sci-Tech Innovation Board (STAR Market), is an international semiconductor foundry strictly complying with the laws and regulations of all jurisdictions where it performs its businesses. Since its inception, the Company has been fully compliant with all rules and laws. SMIC has maintained long-term strategic partnerships with multiple U.S.-based semiconductor equipment suppliers.”

It continued, “Over the years, the Bureau of Industry and Security (BIS) has granted numerous export licenses for the Company. With a large and diverse customer base, serving companies in the U.S., Europe, and other Asian regions, SMIC plays an important role in the global semiconductor supply chain. The Company manufactures semiconductors and provides services solely for civilian and commercial end-users and end-uses. We have no relationship with the Chinese military,” it continued.

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