Biden Administration considers new sanctions on sending chipmaking tools to China: report

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The Biden Administration is going over new sanctions to stop sending certain chip equipment tools to China to make advanced semiconductors, while also not hurting the global economy, Reuters reported.

The news outlet, citing five people familiar with the matter, noted that the Commerce Department is trying to figure out how to ban exports of tools that are sent to factories for Semiconductor Manufacturing International Corp. (OTCQX:SMICY) or SMIC, to prevent them from making semiconductors at 14 nanometer node and smaller.

The government agency would also let those tools be sent to factories to make less advanced semiconductors, as the globe still deals with a semiconductor shortage exacerbated by the pandemic.

SMIC started producing 14 nm chips in 2019, the company has previously said.

The Commerce Department did not immediately respond to a request for comment from Seeking Alpha.

However, a spokesman told Reuters that "with respect to semiconductor-related export license applications in particular, (Commerce) and the other reviewing agencies ... consider a variety of factors in making licensing decisions, including the technology node for the proposed export."

On Tuesday, it was reported that the U.S. government was lobbying Dutch officials to get ASML Holding (ASML) to stop selling some of its older deep ultraviolet lithography systems to China.

If the Biden administration goes through with the ban, it would be the first time the Commerce Department has a factory-by-factory approach to export policy, though it could also be interpreted as targeting SMIC (OTCQX:SMICY), Reuters added.

In December, it was reported that the Biden administration was evaluating imposing tougher sanctions on SMIC (OTCQX:SMICY), China's largest chipmaker, which have limited the ability of chip equipment companies to sell inside the country, including Applied Materials (AMAT), KLA Corp. (KLAC) and Lam Research (LRCX).

Last month, it was reported that hedge fund Bridgewater Associates has a $1B short position against chip manufacturer ASML Holdings (ASML) as part of a larger $5.7B bet against European stocks.

Comments

[Paco Lilzz]

Its Not even US tech here. Dutch DUV machinese has nothing to do with US. And yet US bullying ASML and Dutch.
If US compete mano to mano with China , US will lose. US has to depend on alot of other people just to have a fighting chance.

[sg-neophyte]

My apologies, I failed to understand the part of the sentence dealing with the other companies: "In December, it was reported that the Biden administration was evaluating imposing tougher sanctions on SMIC (OTCQX:SMICY), China's largest chipmaker, which have limited the ability of chip equipment companies to sell inside the country, including Applied Materials (AMAT), KLA Corp. (KLAC) and Lam Research (LRCX)."

[tzeshan]

Why can’t nations, races, cultures cooperate to make a peaceful happy rich world?

[Pistolero Yogi]

@tzeshan ....became I hold LMT RTX GD HII NOC... and I like to see them skyrocket. Haha

[deeminimus]

@tzeshan it's not in our species nature

[TheNewNorm]

When we stop playing the bully with sanctions, and start rebuilding our own manufacturing infrastructure... that will be a happy day.

[TheNewNorm]

@TheNewNorm oh, additionally... the current episode in the Ukraine would be an economical non-issue if we had followed Germany and put solar panels on our rooftops 5 years ago, converted our trucking fleets to natural gas and allowed the USPS to convert their fleet to EVs instead of punishing them with ridiculous mandates on their retirement account. Just saying.

[Niarb Namtih]

@TheNewNorm Washington's "get tough" policies on China helps Biden relive those glorious Corn Pop days and the Trumpsters get hard (sort of) dreaming about the size of their gas tanks and tires on their pickup trucks.

[Et20]

@TheNewNorm

Germany is going back to coal. Just saying.

[MikeFromNZ]

Let's see, how do we force China to seize Taiwan? Suggestions anyone?

[Pretired]

@MikeFromNZ well if they did that, then they definitely would be cut off from the west and TSMC would be in same postion as mainland China.

The West invented the semiconductor industry and spent billions developing all the methods/technology. China wants to jump the line and produce at the top nodes and take away market share from Western companies and jump start their military ---all based on Western past investment. Semiconductors/Tech/Economy are the keys to world leadership/defense.

If the Chinese Dictator wasn't Anti-West at every step, then maybe he'd have avoided all the tariffs and sanctions. It all started becaused Trump put on some tariffs and Xi retaliated/escalated.

[vooch]

@Pretired

The west -

You mean 12% of the population and 35% of economic output ?

That West ?

[C185]

@vooch and all the semiconductor knowledge and semi equipment companies. Check out who Morris Chang is. He has US nationality and was educated and trained in the US.

[Chris Lau]

$ASML already stopped supplying to China, capping its telecom industry to 4G.

[adria.nature]

"Biden Administration considers new sanctions on sending chipmaking tools to China"

imagine

Xi Administration considers new sanctions on exporting rare earths and semiconductors

[ILIVETHERE]

@adria.nature Win-win for the US.

[Croogie]

Clever move: giving someone the order to end its business at no costs.

Now some more people will consider more truth in Putins words: "europe is like a colony of the USA" ...

AND it will hint China once again to get rid of any american or international support and make all for itself. And in 5 years ASML will get fierce competion by some "red flag" company ...

[Avid Reader55]

@Croogie And Eastern Europe used to be a colony of the Soviet Union... Me thinks Putin doth protest too much!!

[Tambo210]

No comment on why?

Copyright infringement? Weapons? They will make chips quicker than RoW and trash the market, before holding the world to ransom as Russia does Europe with Nat Gas?

[ComputerBlue]

Govt deciding where a business can participate..trying to cap another countries price on oil…absent leadership