Washington has pulled Taiwan Semiconductor Manufacturing Company’s (TSMC) authorization to freely ship advanced technology from the US to China, the company said. This move could potentially disrupt TSMC’s operations in China, which focus on older-generation chips.
The US made a similar decision last week affecting South Korea’s Samsung and SK Hynix, making it more complicated for these companies to export American products to their Chinese factories.
TSMC told the BBC it was assessing the situation and would be in talks with the US government, adding it remains fully committed to ensuring the uninterrupted operation of its facility in China. The chipmaker was notified that its authorization to export advanced technology to China would be revoked by the end of the year. The BBC has reached out to the US Commerce Department for comment.
Impact on TSMC and the Semiconductor Industry
As the world’s largest semiconductor manufacturer, TSMC produces chips for a wide array of tech devices, serving clients such as Nvidia. The US has implemented sweeping restrictions on exporting advanced technology to China as part of broader efforts to protect its economic interests, although some global tech firms initially received temporary waivers.
It remains uncertain how quickly licenses may be approved, which could slow down shipments. Investment specialist Raymond Woo noted that the Trump administration’s measures could make exports more expensive and complex, as US suppliers would now need to seek individual approvals.
Challenges and Opportunities for Chinese Tech Firms
Chinese companies might be forced to turn to domestic alternatives that are several generations behind, though this limitation could also drive innovation, as firms optimize existing equipment where peak performance is less critical, Woo added.
Overall, the impact on TSMC is expected to be limited, given that its sole Chinese facility in Nanjing produces older chips that account for a small fraction of total revenue, said Mr Woo from Kyoto University Innovation Capital, the school’s investment arm.
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