Singapore warns against chip export control circumvention amid regional concerns
Singapore has issued a strong warning to companies against using the city-state to circumvent other countries’ export controls on advanced semiconductor and artificial intelligence technologies, according to a joint advisory published by Singapore Customs and the Ministry of Trade and Industry.
The 4 April notice comes amid growing concerns about the diversion of restricted semiconductor technologies to China through third countries in Southeast Asia, with recent investigations highlighting Singapore’s and Malaysia’s roles in potential export control violations.
‘The Singapore Government does not condone businesses deliberately using their association with Singapore to circumvent or violate the export controls of other countries,’ the advisory stated. ‘This applies to all our trading partners.’
While Singapore’s export control regime primarily aligns with multilateral export control regimes and UN Security Council sanctions, the advisory specifically acknowledges that ‘several countries have imposed unilateral export controls on advanced semiconductors, semiconductor manufacturing equipment and Al-related technologies’ in recent years.
The unprecedented level of warning signals Singapore’s sensitivity to recent reports of export control violations. In late February, Singapore charged three men with fraud in cases reportedly linked to the movement of restricted Nvidia Al chips. According to Singapore’s Law and Home Affairs Minister K Shanmugam, servers containing Nvidia’s restricted chips were allegedly sent to Malaysia in a possible sanctions evasion scheme. The charges came after Singapore was implicated in a US investigation into whether Chinese start-up DeepSeek had circumvented American restrictions on advanced Nvidia chips.
This follows a Wall Street Journal report in March that Chinese buyers were successfully ordering Nvidia’s newest Blackwell Al chips through third parties in nearby regions, with traders saying they used ‘entities registered outside of China to purchase Nvidia servers from companies in aces such as Malaysia, Vietnam and Taiwan.’
Last month, Malaysian Trade Minister Tengku Zafrul Aziz told CNBC that his country would take ‘necessary action’ against any domestic companies involved, questioning why the chips would be leaving Singapore in the first place, since ‘the chips are not meant to be in Malaysia’.
Singapore’s advisory warns businesses that ‘engaging in illicit practices can lead to legal, operational and reputational consequences,’ and that authorities will take action against companies or individuals engaged in ‘fraudulent or dishonest practices to evade export controls that they are subject to.’
To mitigate risks, the notice encourages businesses to implement robust internal compliance programmes including Know Your Customer practices, end-user screenings and order screening procedures to identify potential red flags such as abnormal shipping routes.
Singapore, a major global hub for semiconductor manufacturing and trading, has positioned itself as maintaining a neutral stance while adhering to international obligations. The advisory emphasises that Singapore will ‘continue to uphold our reputation as a global hub for technology and trade, safeguard the integrity of our business environment, and support continued access to leading edge technology for legitimate companies operating here.’
