US Contemplates New Restrictions on Global Chipmakers Amidst Trade Tensions

The U.S. Department of Commerce is evaluating the possibility of withdrawing authorizations previously granted to major global chipmakers such as Samsung, SK Hynix, and TSMC. This action, under consideration, would make it more challenging for these companies to obtain U.S. goods and technology for their operations in China, sources indicate.

While uncertainty surrounds the potential withdrawal, a White House official has emphasized the initiative as a preparatory measure should the existing trade truce between the U.S. and China deteriorate. Despite this, the official remains optimistic about continuing the current trade agreement, crucial for the smooth flow of rare earth materials from China.

Market reactions were swift, with shares of U.S. chip equipment makers, such as KLA Corp, Lam Research, and Applied Materials, experiencing declines upon the announcement. Conversely, competitor Micron saw a slight increase. The world watches closely as these developments unfold, as they could bolster the position of domestic Chinese chip manufacturers.

(With inputs from agencies.)