The Biden administration has lifted export restrictions on chip-design software to China, easing one of the more contentious trade controls imposed amid escalating tensions earlier this year. The move, announced Thursday by major U.S. and European software firms, signals incremental progress in U.S.-China trade negotiations and comes as both sides begin rolling back retaliatory measures.
Synopsys, Cadence Design Systems, and Siemens AG-three dominant players in the electronic design automation (EDA) market-confirmed they had received letters from the U.S. Department of Commerce informing them that previous licensing requirements for exports to China were rescinded. Siemens, whose EDA arm is headquartered in Oregon, said it had "restored full access" to its software and resumed sales and support for Chinese clients.
Shares of Synopsys and Cadence each rose about 3% Thursday following the announcement, while Siemens gained 1.7% in early trading.
Synopsys told employees in an internal memo that system access for Chinese customers would be restored within three business days. "We are committed to ensuring continuity and support for our clients as we move forward," the company noted. The Commerce Department did not immediately respond to requests for comment.
The reversal follows weeks of behind-the-scenes diplomacy. On Friday, China's Ministry of Commerce confirmed it had reached a framework agreement with U.S. officials that would allow for conditional reviews of China's export licenses on rare earths and other sensitive materials. In exchange, the U.S. agreed to roll back selected technology curbs, including those on EDA software and ethane exports.
A U.S. official familiar with the discussions told Reuters, "The U.S. have escalated to de-escalate. They put restrictions on many more items in order to get the Chinese to back off on rare earths."
The restrictions had threatened to paralyze China's chip design industry. According to TrendForce, Synopsys, Cadence, and Siemens together control more than 70% of China's EDA market. A long-term ban could have severely hindered Beijing's ambitions to develop an independent semiconductor supply chain.
Synopsys CEO Sassine Ghazi previously noted during a May earnings call that the company had experienced a "slowdown in China," where clients accounted for roughly 10% of its $1.6 billion quarterly revenue. China's ongoing push to support domestic alternatives in EDA software remains a key strategic goal.
