TSMC can't send advanced AI chips to China anymore, U.S. says
The U.S. has reportedly ordered the world’s largest chipmaker not to send its advanced artificial intelligence chips to China anymore.
Taiwan Semiconductor Manufacturing Company (TSM) was told to stop shipping advanced AI chips to Chinese customers starting Monday, Reuters reported, citing an unnamed person familiar with the matter. The Department of Commerce told the Taiwanese chipmaker in a letter that it is imposing export restrictions on advanced chips made with the 7-nanometer process or smaller, the person said.
Meanwhile, TSMC reportedly told its Chinese customers it is no longer manufacturing AI chips with the advanced 7-nanometer process or beyond starting Monday, the Financial Times reported, citing unnamed people familiar with the matter.
If TSMC does produce the advanced chips for Chinese firms in the future, the U.S. government would likely be involved in an approval process, the people said. They told the Financial Times they are unsure if the rules will affect other chips that China’s leading chip firms are designing. The rules will reportedly have a minimal impact on TSMC’s revenue.
TSMC said it is a “law-abiding company and we are committed to complying with all applicable rules and regulations, including applicable export controls,” in a statement previously shared with Quartz. It declined to comment further.
The chipmaker reportedly made the decision to cut off Chinese firms to improve internal controls and in anticipation of updated U.S. export controls on chips sold to China by the outgoing Biden administration. TSMC is also reportedly worried about being targeted by the incoming Trump administration, which has accused Taiwan of stealing chip manufacturing from the U.S.
TSMC’s new rules come as the chipmaker faces an investigation into how its advanced chip technology ended up in a cutting-edge AI accelerator from sanctioned Chinese tech giant Huawei. Canadian research firm TechInsights took apart Huawei’s chip and reportedly found the TSMC-made tech.
The Taiwan-based company is also facing rules at home that restrict it from producing 2-nanometer chips abroad, the Taipei Times reported.
J.W. Kuo, Taiwan’s minister of economic affairs, said that although the company will eventually produce the advanced chips abroad, “its core technology will stay” on the island.
“Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said during a meeting with Taiwan’s Economics Committee, according to the Taipei Times.
