US government sanctions against China are not letting up. Long targeted by the US, China’s activity in advanced chip manufacturing tools will continue with more severe restrictions that even some US allies have described as draconian.
Proposals include implementing the Foreign Direct Product (FDP) rule, pressuring allies to limit service and repair of equipment in China, and expanding the unverified list requiring licenses for certain technologies. These measures are aimed at curbing developments in China’s semiconductor industry.
A key proposal is the implementation of the FDP rule, which would allow the US to exercise control over foreign-made products containing any American technology. According to the Bloomberg report, this would particularly affect companies such as Tokyo Electron and ASML, restricting their ability to supply advanced wafer fabrication equipment (WFE) to China.
In addition, the US is calling on its allies, including Japan and the Netherlands, to impose tighter restrictions on businesses within their borders, in particular restricting their ability to service and repair semiconductor equipment delivered to China. Again, if enacted, this would primarily affect ASML and Tokyo Electron.
This measure is aimed at preventing Chinese chipmakers such as SMIC from maintaining or upgrading their equipment using foreign assistance, thereby halting their progress in developing more advanced nodes and producing chips with sophisticated process technologies.
Another strategy is to expand the criteria for the unconfirmed list. This list requires companies to obtain licenses to ship certain restricted technologies. By expanding this list, the US aims to signal that firms that continue to serve Chinese customers deemed to be security risks may face additional controls and to prevent Chinese companies from circumventing existing restrictions by relying on foreign equipment and expertise.
Covid decision from the US for 3 Chinese and 3 Thai organisations
