US President wants broader restrictions on chip exports to China

President Biden plans to expand export restrictions on AI chips and chip production equipment in October. Sources told Reuters. This means that companies must have a license to supply certain products to China.

The plans formalize restrictions that the US Department of Commerce previously imposed on several companies, writes Reuters news agency. Companies such as LAM Research, Applied Materials and KLA were told earlier this year that they will not be allowed to export chip production equipment for sub-14nm chips to China unless the companies are licensed to do so. The ministry also told AMD and Nvidia earlier this year that they will no longer be allowed to supply certain accelerators for AI to China unless they apply for a license to do so

Formalizing these restrictions would increase their scope. It also allows other US companies that produce similar chips and equipment to be subject to the rules. The rules could also impose licensing requirements on products containing the chips in question. Currently, that is not yet the case. Reuters writes that, for example, HPE and Dell make data center servers with the Nvidia A100, which falls under the restrictions.

The U.S. Department of Commerce says it is reviewing its policy around China, but has not yet agreed to discuss specific changes, a spokesman told Reuters. The goals include preventing China from “acquiring American technology” for modernizing the military.

The trade war between the US and China has been going on for a long time. Reuters wrote in July that it is trying to block the export of advanced chip production equipment to China. Among other things, the US would like the Netherlands to block the export of ASML’s duv lithography machines to China, Bloomberg claimed earlier. In addition, the US recently introduced a Chips Act that releases billions in subsidies for the semiconductor sector. The condition for getting that subsidy is that the companies do not build new advanced chip factories in China in the next ten years.