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According to multiple reports, the US is planning new restrictions on chip exports to slow China’s AI development.
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It could blacklist 200 Chinese semiconductor equipment makers, Wired reported.
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Targeting Chinese chip equipment manufacturers could benefit European companies like ASML.
The Biden administration is reportedly considering new sanctions on Chinese semiconductor equipment makers, driving up shares of semiconductor suppliers in Europe and Japan.
Bloomberg reported that while the newly proposed sanctions still target Chinese chip factories, they place more emphasis on domestic companies that supply manufacturing equipment to chipmakers. The proposed restrictions would add an additional 100 Chinese chip equipment makers to the entity list, the outlet reported.
That pushed the share price of ASML – the Dutch company that supplies crucial specialized equipment to chip manufacturers, including the Chinese SMIC – up by more than 4.27% on Thursday.
Tokyo Electron, which also sells equipment for chip production, saw its share price rise by more than 6% on Thursday.
The restrictions, expected as early as next week, could also add chipmakers to the sanctions list, including key suppliers to Chinese smartphone maker Huawei, Bloomberg and Wired reported, citing people familiar with the matter. The new proposals would affect fewer Huawei suppliers, the reports said.
As part of the sweeping sanctions, the US could add 200 Chinese chipmakers to its trade blacklist, Wired reported. The controls could also include restrictions around the trade in memory chips, which are crucial to the development of AI models.
‘Malicious attempts to block and suppress China’
Chinese shares fell on Thursday. Hang Seng shares fell more than 1%, and the CSI and Shanghai Composite also fell 0.57% and 0.10%, respectively.
“This decline comes as the Biden administration considers imposing additional restrictions on critical semiconductor sales to China, possibly as early as next week.,” said Jim Reid, Deutsche Bank’s global head of economics and thematic research, said in a research note.
The Biden administration has worked in recent years to limit China’s progress in the semiconductor industry by implementing export controls aimed at cutting off access to buy advanced AI chips and chip-making equipment.
US chip equipment makers and allies such as Japan and the Netherlands have reportedly pushed back against previous proposals.
Under the new rules, companies and even foreign companies that have used American parts or software to design and produce AI chips will have to obtain licenses to export to China.
Mao Ning, a spokesman for China’s Foreign Ministry, said at a news conference this week: “China strongly opposes the US overextending the concept of national security, abusing export control measures and making malicious attempts to block China and to suppress.”
The U.S. Commerce Department did not immediately respond to a request for comment from Business Insider, which was made outside normal business hours.
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