According to industry officials, Samsung Electronics and SK Hynix are on high alert over the Biden administration's newest initiative to restrict exports of U.S. semiconductor equipment and high-powered chips to China in order to slow the expansion of the world's second-largest economy in high-tech industries.
The Biden administration intended to exempt foreign companies working in China, such as SK Hynix and Samsung, from the new limitations, but the guidelines announced on Friday did not do so.
By late Tuesday, just hours before a new restriction went into effect, South Korean memory chipmaker SK Hynix announced that it had received license from the U.S. to acquire items for its chip production facilities in China without the additional licensing required by the new rules.
As written, the regulations demand licenses before US exports may be sent to Chinese factories producing advanced chips in an effort on the part of the U.S. to halt China's technological and military advancements.
Additionally, as of Tuesday at midnight, vendors cannot support, service, or send non-U.S. materials to manufacturers located in China without licenses if U.S. firms or individuals are engaged.
The use of so-called nonplanar transistors in logic circuits with 16-nanometer or higher technology, 18-nanometer dynamic random access memory chips, and Nand-style flash memory chips with 128 layers or more is prohibited.
As a result, even simple parts such as light bulbs, springs, and bolts that keep tools functioning may have been unable to ship until merchants were granted licenses. And, according to one insider, without the minute-by-minute support the foundries require, they may begin to close down.
"Our discussions with the Department of Commerce led to an approval to supply equipment and items needed for development and production of DRAM semiconductors in Chinese facilities without additional licensing requirements," SK Hynix said in a statement.
The company stated that the measure would help avoid supply chain interruptions and that the authorization is valid for a year.
According to another source, the interim remedy was put in place until a longer-term solution could be worked out. According to a third source, at least one other non-Chinese corporation acquired a similar authorization.
The U.S. intended to assess licenses for non-Chinese manufacturers in China affected by the new limitations on a case-by-case basis, but even if allowed, shipments could be delayed. Licenses for Chinese chip manufacturing were almost certainly rejected.
Taiwan Semiconductor Manufacturing Co. and Intel Corp. also have chip manufacturing facilities in China.
