US Huawei Second Offensive... Semiconductor Manufacturing Equipment and Chip Supply Restrictions

Foreign Companies Must Obtain Prior Approval

[Asia Economy Reporter Kwon Jae-hee] The Trump administration in the United States is showing signs of launching a 'second offensive' aimed at the world's largest telecommunications equipment company, Huawei, by restricting the supply of semiconductor manufacturing equipment and chips. Although a thaw in relations between the two countries was created with the Phase One US-China trade agreement in January, this move comes amid renewed tensions as both sides blame each other for the COVID-19 pandemic. The US had already taken a 'first offensive' last May by placing Huawei on the 'blacklist' concerning purchases of 5G next-generation communication networks.

According to major foreign media on the 26th (local time), senior US economic and trade officials have decided to impose restrictions on the supply of semiconductor manufacturing equipment and chips to Huawei.

The core of this measure is that foreign companies using US chip manufacturing equipment must obtain prior approval from US authorities to supply certain chips to Huawei. Last month, the US Department of Commerce drafted the 'Foreign Direct Product Rule (FDPR),' which includes provisions preventing semiconductor companies such as Taiwan's TSMC, the world's largest semiconductor foundry, from supplying chips to Huawei. This new measure is a follow-up action.

Semiconductor foundries cannot produce chips without US chip manufacturing equipment. In a report last year, China Guangda Bank stated, "Most semiconductor chip makers in China use equipment from US companies such as KLA." In this context, the move essentially signals an intent to completely block Huawei's access to core semiconductor technology.

The US Department of Commerce has openly stated that "the goal is to prevent all semiconductor manufacturing plants worldwide from supplying equipment to Huawei."

If this measure is implemented, it could affect not only TSMC, which supplies equipment to Huawei's subsidiary HiSilicon, but also Huawei's global supply chain, sales, and research and development (R&D).

However, this decision still requires approval from President Donald Trump, so changes cannot be ruled out. Implementing additional regulations on Huawei after signing the Phase One US-China trade agreement could damage relations with China.

Previously, the US added Huawei and its affiliates to the trade 'blacklist' and recently urged its European allies not to use Huawei products.

This content was produced with the assistance of AI translation services.