Due to the ongoing geopolitical tensions between China and the US, the US government placed restrictions on the supply of US-made chip technologies and equipment to Chinese firms. Since Samsung has semiconductor chip factories in China, the company faced issues with the supply chain, affecting its business. But the company may get some good news soon.
It is being reported that the US may soon announce a new policy that may allow chipmakers to use US-based chip equipment in their chip factories in China. Earlier, the US had placed restrictions on exporting US-based chip technologies and equipment to China. As semiconductor chip makers like Samsung and SK Hynix suffered due to this restriction, the US government offered a moratorium on that export policy.
Samsung may be allowed by the US to bring more advanced chip equipment to its factories in China
The US government may update its existing VUE (Verified End User) list, which is a comprehensive licensing method that allows the export of designated items only to those firms that have been approved beforehand. Once a company has been included in the VUE, they don’t need to apply for a separate permit to import chip technologies and machines into China. Currently, a permit is required to supply application processors made using 16nm (or better FinFET), 18nm DRAM (or better), and 128-layer NAND flash chips (or better) to Chinese firms.
The US Department of Commerce’s BIS (Bureau of Industry and Security) has reportedly been discussing things with Samsung Semiconductor and SK Hynix about the chip equipment that they can bring into their chip factories in China. These discussions have reportedly been virtually concluded, and the final decision could be made soon. Once the decision is made, the companies will be notified.
Samsung can upgrade its chip factories in China to be more competitive as regulations ease
It is being reported that the level of chip equipment allowed to be imported into China through VUE is higher than that of the moratorium that was given earlier. So, Samsung and SK Hynix can import more advanced chip equipment that is required to keep their factories competitive. Recently, Huawei unveiled its first in-house Kirin chip that is made using China’s own 7nm semiconductor chip fabrication technology by SMIC.
U.S. Deputy Secretary of Commerce Don Graves told Yonhap News reporter during their visit to South Korea, “I want to make it clear that Korean semiconductor companies will be allowed to continue their legitimate business in China. We will ensure that companies can continue their business. I will do everything to make sure that happens.“