Written by Karen Freifeld and Fanny Potkin
The United States has directed Taiwan Semiconductor Manufacturing Co to stop shipping advanced chips to Chinese customers for artificial intelligence applications, starting Monday, according to a source familiar with the matter.
The Department of Commerce has issued a letter to TSMC imposing export restrictions on specific sophisticated chips with designs of 7 nanometers or more for China, which are used in AI accelerator and graphics processing units (GPU).
This move by the U.S. follows TSMC’s disclosure to the Commerce Department that one of its chips was discovered in a Huawei AI processor, violating export controls. TSMC had suspended shipments to China-based chip designer Sophgo after the chip matched the one found in the Huawei AI processor.
The latest action will allow the U.S. to investigate if other companies are diverting chips to Huawei for its AI processor. TSMC has informed affected clients that it is suspending chip shipments starting Monday.
Both Republican and Democratic lawmakers have expressed concerns about export controls on China and the enforcement by the Commerce Department. In 2022, the Commerce Department restricted the export of top AI-related chips to China and tools to make advanced chips to China.
The U.S. has been slow in updating rules on tech exports to China, with delays in releasing new rules on chipmaking equipment exports and adding Chinese companies to the restricted entity list.
