The US is tightening restrictions on exports of chip-making equipment to China
According to two major chip equipment suppliers, the United States is tightening limitations on China's access to equipment for chipmaking. Washington had prohibited the sale of most gear that can create 10 nanometers chips or less without a license to Semiconductor Manufacturing International Corp. Now, according to Tim Archer, the company's president and CEO, it has extended that barrier to equipment that can produce anything more sophisticated than 14 nm. According to Archer, the ban is likely to continue beyond SMIC and includes other fabrication facilities run by contract chipmakers in China, including Taiwan Semiconductor Manufacturing Co.'s.
“We were recently notified that there was to be a broadening of the restrictions of technology shipments to China for fabs that are operating below 14 nanometers,” Archer said on a conference call on Wednesday. “That’s the change, I think, people have been thinking might be coming and we’re prepared to fully comply. We’re working with the US government.”
In chip manufacturing, reducing the scale to 14 nm from 10nm indicates a higher degree of production. This implies that raising the restriction level to 14 nm from 10 would cover a broader range of semiconductor equipment. The Commerce Department stated in a release that it will tighten regulations targeting China, without stating the precise chip geometries involved.
According to people familiar with the situation, all US equipment manufacturers have recently received letters from Commerce notifying them that they are not permitted to offer equipment to China for 14 nm or less production. The letters are at least partly a reaction by the Biden administration to appear tough on China, although Commerce had previously denied many licenses at 14 nm, so the shift will have minimal financial effect.
The new criteria are aimed at foundries, which create logic chips for others, and they exclude memory chips "to the best of our understanding," according to Archer. Archer said that the US regulations had been factored into Lam Research's third-quarter earnings outlook.
On Thursday, Rick Wallace, the CEO of KLA Corp., also confirmed that his firm had been informed by the US government of a change in export licensing criteria for chips manufactured on China. Wallace said there was no material impact on KLA's operations.
The remarks from the two California-based firms represent the first extended confirmation that the Biden administration is intensifying efforts to contain China. The United States is urging other countries, including the Netherlands and Japan, to prohibit ASML Holding NV and Nikon Corp. from selling chipsmith technology to China.
Source: www.bloomberg.com
