The US trade war against China in the semiconductor industry is entering its third major round. 140 companies are affected, this time the focus is primarily on suppliers to the chip industry who recently had a free pass here and there or simply hadn’t appeared on the radar at all.
The new edition is an extension of the existing entries on the so-called Entity List , the document that lists all the companies with which Western companies are not allowed to do business, or only with prior approval for certain products. The major update expected this week is primarily intended to close loopholes, but there will still be exceptions.
HBM2(e) was not banned in China until now – but is it now?
Some Japanese companies in particular will receive exceptions, as will ASML from the Netherlands, according to a preliminary report from Reuters . Companies in the semiconductor industry from Israel, Malaysia, Singapore, South Korea and Taiwan, for example, are prohibited from doing direct business with Chinese companies. This could well cause resentment, because the new sanctions package is also expected to include increased use of HBM2(e) – it is suspected that Samsung makes 30 percent of its sales with this type of memory in China. HBM2 in its various expansion stages is used by Huawei’s Ascend series AI accelerators, among others.
Fabs and suppliers increasingly in the spotlight
It is not surprising that the expanded sanctions have hit SMIC again . China’s flagship foundry builds all modern chips, but has had exceptions that have been used for billion-dollar deals since 2020.
Equipment manufacturers and suppliers in particular are now increasingly affected. These include companies such as Piotech and the more well-known Naura , which have been working with SMIC for a long time. But Wingtech is also now apparently involved, working with samsung, Lenovo, Xiaomi and Oppo, among others, but also Nexperia. Nexperia had only announced increased cooperation with Wingtech for its Hamburg location in the summer. But that was not so surprising, after all, Wingtech had already bought into Nexperia five years ago. What effects the new sanctions package could have is not yet known.
The total of around 140 expanded entries on the list include many partner companies that supply Huawei. They are still considered the most powerful company from China. In order to nip any new efforts in the bud, companies such as Swaysure are also on the list. The name first appeared in the media a year ago as a possible new memory manufacturer .https://youtu.be/nfw6Rm_nXxk?si=UBapEHMFUSLgZ8y4
Biden administration introduces new sanctions, Trump continues them
Although the new sanctions are being introduced under the current Biden-Harris administration, the general consensus is that they will remain in place under the next US President Trump. Many of the restrictions originally introduced against China were introduced during his first term in office. The tone in this regard has not really changed under Biden; on the contrary, it has sometimes become even harsher. The aim of the USA and its Western allies is to delay the use of Western high technology for China’s military. Many gaps in the system in recent years have shown that this cannot be completely prevented; at best it can be postponed.