US Reported to Consider Blacklisting Huawei-Related Chinese Chip Firms

TMTPost -- The U.S. government may further tighten up its curbs on China’s semiconductor industry.

Credit：Visual China

The Biden administration is considering blacklisting Chinese semiconductor companies related to Huawei Technologies Ltd., Bloomberg reported, citing people familiar with the matter. It was reported that The companies that could be blacklisted include chipmakers Qingdao Si'En, SwaySure, and Shenzhen Pensun Technology Co, (PST) and China’s leading memory chipmaker, ChangXin Memory Technologies Inc.,(CXMT) could also face U.S. sanctions. Most of companies that coule be placed on the blacklist were identified as chipmaking facilities took over or being built by Huawei by the Washington-based trade group Semiconductor Industry Association, according to the report.

The reported export curbs on Huawei-linked semiconductor network came from a rule that the U.S. government imposed stricter export controls after Huawei made a surprising 5G comeback with smartphone M60 Pro. Multiple reports attributed Mate 60’s 5G connectivity to Kirin 9000s chipset, which was deemed as evidence that Huawei managed to defy years of U.S. sanctions. A spokesperson of the U.S. Department of Commerce said last September that the agency is working to “obtain more information on the character and composition of the purported 7nm chip”. “Let’s be clear: export controls are just one tool in the U.S. government’s toolbox to address the national security threats presented by the PRC,” the spokesperson said in a statement.The U.S. Commerce Secretary Gina Raimondo said she was upset by the advanced Huawei smartphone report at a U.S. House hearing on September 20. She told lawmakers that the government don’t have evidence that Huawei can mass produce 7-nanometer chips.

Raimondo told Senators at a hearing at the beginning of October that Huawei’s chip breakthrough are “incredibly disturbing” and called for “different tools” and “additional resources” to enforce export control. Later that month, the U.S. Department of Commerce introduced a rule entitles “Implementation of Additional Export Controls: Certain Advanced Computing Items; Supercomputer and Semiconductor End Use; Updates and Corrections”. The department said the rule reinforces the controls launched in October 2022 to restrict China’s both purchase and manufacture certain high-end chips critical for military advantage. The agency believes the rules are necessary to maintain the effectiveness of these controls, close loopholes, and ensure they remain durable.

Raimondo said the rule targets foreign entities including Chinese ones’ access to U.S. data centers to train AI models. "We can't have non-state actors or China or folks who we don’t want accessing our cloud to train their models," Raimondo told Reuters in an interview last month. "We use export controls on chips. Those chips are in American cloud data centers so we also have to think about closing down that avenue for potential malicious activity," the Secretary said.

China opposes US politicizing, instrumentalizing and weaponizing trade and tech issues, and will closely follow the developments and firmly safeguard our legitimate rights and interests, Wang Wenbin, the spokesperson of China’s Foreign Ministry, said last October. Arbitrarily placing curbs or forcibly seeking decoupling to serve political agenda violates the principles of market economy and fair competition, undermines the international economic and trading order, disrupts and destabilizes global industrial and supply chains and will eventually hurt the interests of the whole world, Wang said.

The rule, introduced on October 18, was supposed to come into effect following a 30-day public comment period. However, Nvidia Corporation, the AI chip leader,disclosed on October 25 that the U.S. government informed the licensing requirements of the rule applicable to products having a “total processing performance” of 4800 or more and designed or marketed for data centers, is effective immediately.

Nvidia has modified some of flagship products including A100 and H100 for exports to China, including an alternative A800 chip, as the U.S. regulators last year banned it from selling its most advanced chips to China. But even A800, the weakened version of Nvida’s cutting-edge A100 processor, is not allowed for export without first obtaining a license according to the new restrictions.

The bipartisan leaders of a U.S. House of Representatives panel urged the federal government to take stronger action to stem China’s growing dominance in making older-generation microchips that are essential across several U.S. industries, the Wall Street Journal cited a letter of a committee on China in January. The U.S.’s stepping up control over chip export to China is out-and-out economic bullying, Chinese Foreign Ministry spokesperson Mao Ning commented that month. The U.S. uses national security as a pretext to restrict chip export to China, but the measures it has taken clearly go beyond the realm of national security and have gravely hindered the normal trade of ordinary chips for civilian use, Mao said. She warned that the U.S. behavior is taking a serious toll on the stability of the global industrial and supply chains, and such selfish move will inevitably backfire.