Key points
- The US will revoke previous authorizations allowing Samsung, SK Hynix, and Intel to use American equipment for chip production in China.
- Companies will now require licenses to purchase US semiconductor manufacturing equipment for use in China.
- This move is expected to reduce sales for US equipment makers like KLA, Lam Research, and Applied Materials.
- The change could benefit Chinese domestic equipment manufacturers and US memory chipmaker Micron.
The United States is significantly tightening its restrictions on the export of semiconductor manufacturing equipment to China, impacting major global players. The Commerce Department announced the revocation of previously granted exceptions that allowed Samsung, SK Hynix, and Intel to utilize American-made equipment in their Chinese chip production facilities.
This action, detailed in the Federal Register, marks a substantial escalation of the US government’s efforts to curb China’s advancement in the semiconductor industry.
This change necessitates that these companies, and any others seeking to manufacture chips in China, must now obtain individual licenses for each purchase of US-made equipment. This licensing process is expected to create significant hurdles and delays, which will impact production timelines and profitability.
The increased regulatory burden is a direct consequence of the broader US strategy aimed at limiting China’s access to advanced semiconductor technologies.
The move is likely to have a considerable impact on US equipment manufacturers like KLA, Lam Research, and Applied Materials, which will see a reduction in sales to Chinese clients.
Conversely, the stricter controls could provide an opening for Chinese domestic equipment manufacturers to gain market share, filling the gaps left by the restricted US technology. The shift could also benefit US memory chipmaker Micron, which directly competes with Samsung and SK Hynix in the global market.
The new regulations will not take effect immediately, granting a 120-day grace period to allow companies to adjust their operations. However, the long-term implications are significant, potentially reshaping the global semiconductor landscape and intensifying technological competition between the US and China further.
The revocation of these exceptions signals a clear commitment from the US government to maintain its technological edge and limit China’s access to critical semiconductor technologies.
