US Will Tighten Restrictions on China’s Access to the Semiconductor Industry. The United States will tighten measures restricting China’s access to semiconductor technology and semiconductor chip manufacturing equipment. The tightening of restrictions announced in October last year aims to prevent China, a geopolitical rival of the US, from developing advanced technology that could give it a military advantage.
The new rules aim to improve and close loopholes from last year’s restrictions, according to people familiar with the matter. According to sources familiar with the plan, the US will add Chinese chip design companies to its trade restrictions list, forcing overseas manufacturers to obtain US licenses to fulfill orders from these companies.
The US will also strengthen controls on selling advanced chip manufacturing equipment and graphics chips to Chinese companies. US technology companies ranging from Nvidia Corp. to Applied Materials Inc. has suffered hundreds of millions of dollars in lost orders since the initial restrictions were announced last year.
Investors have expressed concerns that an escalating trade standoff would further weigh on US companies’ earnings as China is the biggest market for semiconductors, personal computers and smartphones.
US Will Tighten Restrictions The government will also impose additional checks on Chinese companies that try to circumvent country-specific restrictions by shifting shipments and production elsewhere.
Specifically, the regulations will continue to limit shipments of certain chips to overseas subsidiaries and affiliates of Chinese companies, and begin requiring licenses to export banned technology to countries that can be used as intermediaries.