US orders TSMC to stop shipping advanced chips to Chinese clients
The United States has reportedly ordered Taiwan Semiconductor Manufacturing Co. (‘TSMC’) to stop supplying certain sophisticated microchips to Chinese customers, after one of its controlled chips was found in a Huawei AI processor.
In a letter, the Department informed TSMC of export restrictions on some sophisticated chips of 7 nanometer or more advanced designs going to China, Reuters said in an exclusive report, 10 November, citing ‘a person familiar with the matter.’
Last month, TSMC notified the Commerce Department that one of its chips had been found in an AI processor made by Huawei – an apparent violation of export controls. Following that, the head of the House Foreign Affairs Committee demanded an investigation into whether China’s largest chipmaker SMIC was violating US export controls, amid concerns about its semiconductor production capabilities.
In a letter to Commerce Department official Alan Estevez released 5 November, Representative Michael McCaul called for end-use checks at all SMIC facilities in China to verify compliance with export licences, citing ‘growing evidence that SMIC is violating U.S. export control laws.’
McCaul expressed particular concern about SMIC’s ability to produce 7-nanometer chips for Huawei’s new 5G smartphone, suggesting this indicated potential breaches of US restrictions. He also cited reports that SMIC may soon produce over a million advanced graphics processing units (‘GPUs’), which are powered by those chips.
‘SMIC South’s breakthroughs are a smoking gun that a violation of U.S. export control laws is occurring,’ McCaul wrote in the letter to Estevez, who is Under Secretary of the Bureau of Industry and Security’s (‘BIS’).
The Republican chairman criticised BIS for what he called an ‘aversion to enforcing export controls’ against China’s semiconductor industry. He said, ‘Commercial interests must have no influence in law enforcement matters, and the U.S. government must enforce its laws, agnostic to the size, stature, or scale of the foreign entity.’
The letter followed bipartisan congressional criticism of BIS’s handling of export controls against Chinese tech companies, including Huawei.
