US Revokes Chip Production Permissions for Samsung, SK Hynix, Intel in China Amid Trade Tensions

The US Commerce Department has revoked the exemptions that allowed Samsung, SK Hynix, and Intel to receive US semiconductor manufacturing equipment in China. The revocations will be effective in 120 days, and the chipmakers will now need to obtain licenses to purchase equipment for their Chinese operations. This move could impact the production of advanced chips by Korean chipmakers and provide an advantage to domestic Chinese equipment manufacturers and Micron. China's Commerce Ministry opposes the US move.

The U.S. Commerce Department has revoked the exemptions that allowed Samsung, SK Hynix, and Intel to receive U.S. semiconductor manufacturing equipment in China. The revocations will be effective in 120 days, after which the chipmakers will need to obtain licenses to purchase equipment for their Chinese operations [1]. This move is part of a broader effort to tighten export controls and limit China's access to advanced semiconductor technology [2].

The decision affects Samsung Electronics and SK Hynix, both of which rely heavily on China for memory chip production, essential for smartphones, laptops, and other consumer electronics. The revocation adds pressure on the semiconductor supply chain as the U.S. intensifies restrictions on technology exports amid its rivalry with China [2].

The South Korean government has been closely communicating with the U.S. Department of Commerce to minimize the impact on Korean companies. The Ministry of Trade, Industry and Energy emphasized the importance of smooth operations of chipmakers' Chinese facilities for global semiconductor supply chain stability [2].

China's Commerce Ministry opposes the U.S. move, calling it a misuse of export controls that threatens global supply chains. The ministry urged the U.S. to "immediately correct its wrongdoings" and safeguard the security of global industrial systems [1].

Under Secretary of Commerce Jeffrey Kessler stated that the step is part of a broader effort to close export control loopholes that put U.S. companies at a competitive disadvantage [1]. The U.S. Commerce Department stated that it had "no intention of granting licences that would allow companies to expand capacity or upgrade technology" at their manufacturing facilities in China [1].

The revocation highlights the intensifying struggle over semiconductors, a sector central to military, economic, and technological power. China views the move as part of Washington’s broader strategy to contain its rise in advanced technology, while the U.S. insists the restrictions are vital to protect national security and competitiveness [1].

References:

[1] https://www.financialexpress.com/world-news/china-condemns-us-move-to-revoke-semiconductor-waivers-for-intel-samsung-sk-hynix/3962604/

[2] https://www.electronicsforyou.biz/industry-buzz/us-revokes-veu-status-of-samsung-sk-hynix-and-intel-tightening-semiconductor-tool-exports-to-china/