TSMC says it has received notification from U.S. government that VEU authorization for TSMC Nanjing will be revoked effective Dec. 31

TSMC says it has received notification from U.S. government that VEU authorization for TSMC Nanjing will be revoked effective Dec. 31

The U.S. government has informed Taiwan Semiconductor Manufacturing Company (TSMC) that its validated end user (VEU) authorization for the Nanjing site will be revoked effective December 31, 2025. This move, which mirrors recent actions against Samsung Electronics and SK Hynix, could impact the production capabilities of TSMC's older-generation facility in China [1].

TSMC's statement reads, "While we are evaluating the situation and taking appropriate measures, including communicating with the US government, we remain fully committed to ensuring the uninterrupted operation of TSMC Nanjing." The company's Nanjing site, which began production in 2018, houses technology as advanced as 16-nanometer and contributed a small fraction of TSMC's total revenue last year [1].

The revocation of VEU status means that suppliers to TSMC's China facilities will need to proactively seek U.S. licenses for shipments of goods covered by U.S. export controls. This includes advanced manufacturing gear, spare parts, and chemicals consumed in the production process [1].

The U.S. Commerce Department's Bureau of Industry and Security (BIS) oversees semiconductor export controls and has been working on solutions to ease the bureaucratic burden, given a significant backlog of existing license requests [1]. The agency's actions aim to close export control loopholes that put American companies at a competitive disadvantage [1].

Under President Joe Biden's administration, TSMC, Samsung, and SK Hynix had secured an indefinite waiver to continue making shipments to their China facilities, so long as they complied with security requirements and disclosed certain information to the U.S. government [1].

The situation underscores the U.S.'s influence over the supply chain for electronic components, even when the plants in question are operated by non-American companies in a foreign country. The export curbs affect sales not just to Chinese companies but any facilities physically within the country [1].

References:
[1] https://www.bloomberg.com/news/articles/2025-09-02/us-pulls-tsmc-s-waiver-for-china-shipments-of-chip-supplies