March 26, 2023


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Biden administration tightens restrictions on China’s access to chip technology

Biden administration tightens restrictions on China's access to chip technology

The Chinese government has invested heavily in building the semiconductor industry, but it still lags behind the United States, Taiwan and South Korea in its ability to produce the most advanced chips. In other areas, such as artificial intelligence, China is no longer significantly behind the United States, but those technologies are mostly based on advanced chips designed or manufactured by non-Chinese companies.

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Some of China’s most advanced supercomputers are based on chips made by California-based Intel or Taiwan’s semiconductor manufacturer, which use US technology in their production process, said Jack Dongara, a computer scientist at the University of Tennessee, and will therefore be subject to new laws. .

In a briefing with reporters, senior administration officials said the measures would be limited to more advanced chips, and thus would not have a broad commercial impact on private Chinese companies. But they acknowledged that they could become more restrictive over time, given that technology would start to outpace them.

Industry executives say many Chinese industries that rely on artificial intelligence and advanced algorithms are bolstering these capabilities with US GPUs, which will now be constrained. Those working with technologies such as autonomous driving and gene sequencing, as well as artificial intelligence firm SenseTime and ByteDance, include the Chinese internet company that owns TikTok.

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The new restrictions on sales of chip-making equipment are also expected to constrain the operations of domestic chip manufacturers in China, including International Semiconductor Manufacturer and Yangtze Memory Technologies Co., Ltd. and ChangXin Memory Technologies.

Experts will take time to assess the complex regulations, and many have warned that their impact will depend on how the policy is implemented. For most of the measures, the Commerce Department has the discretion to grant special licenses to companies to continue selling restricted products to China, though it said most of them would be denied.

Some Republican lawmakers and Chinese hawks have criticized the department for being too willing to issue such licenses, allowing US companies to continue selling sensitive technology to China even when national security is at stake.