US: Biden to hit China with broader curbs on US chip and tool exports, sources say

These regulations could likely include additional actions



Photo: Reuters
Photo: Reuters

By Reuters

Published: Mon 12 Sep 2022, 8:18 AM

Next month, the Biden administration plans to broaden curbs — on US shipments to China — of semiconductors used for artificial intelligence and chip-making tools, several people familiar with the matter said.

The Commerce Department intends to publish new regulations based on restrictions communicated in letters earlier this year to three US companies — KLA Corp, Lam Research Corp and Applied Materials Inc, the people said, speaking on the condition of anonymity. The plan for new rules has not been previously reported.

The letters, which the companies publicly acknowledged, forbade them from exporting chip-making equipment to Chinese factories that produce advanced semiconductors with sub-14 Nm processes, unless the sellers obtain Commerce Department licenses.

The rules would also codify restrictions in Commerce Department letters sent to Nvidia Corp and Advanced Micro Devices last month, instructing them to halt shipments of several artificial intelligence computing chips to China, unless they obtain licenses.

Some of the sources said the regulations would likely include additional actions against China. The restrictions could also be changed, and the rules published later than expected.

The so-called "is informed" letters allow the Commerce Department to bypass lengthy rule-writing processes to put controls in place quickly, but these letters only apply to the companies that receive them.

Turning the letters into rules would broaden their reach and could subject other US companies producing similar technology to the restrictions. The regulations could potentially apply to companies trying to challenge Nvidia and AMD's dominance in artificial intelligence chips.

Intel Corp and startups like Cerebras Systems are targeting the same advanced computing markets. Intel said it is closely monitoring the situation, while Cerebras declined to comment.

One source said the rules could also impose license requirements on shipments to China of products that contain the targeted chips. Dell Technologies, Hewlett Packard Enterprise and Super Micro Computer make data centre servers that contain Nvidia's A100 chip.

Dell and HPE said they were monitoring the situation, while Super Micro Computer did not respond to a request for comment.

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A senior Commerce official declined to comment on the upcoming action, but said:

"As a general rule, we look to codify any restrictions that are in is-informed letters with a regulatory change."

A spokesperson for the Commerce Department on Friday declined to comment on specific regulations but reiterated that it is "taking a comprehensive approach to implement additional actions ... to protect US national security and foreign policy interests."

KLA, Applied Materials and Nvidia declined to comment while Lam did not respond to requests for comment. AMD did not comment on the specific policy move but reaffirmed it did not foresee a "material impact" from its new licensing requirement.


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