US Likely to Notify Samsung and SK This Week of Temporary Waiver for Equipment Import to China Factories

Korean Companies Resolve Business Uncertainty

The U.S. government is reportedly set to announce as early as this week an indefinite suspension of restrictions on the import of U.S.-made semiconductor equipment to the Chinese factories of Samsung Electronics and SK Hynix.

With the expiration of the U.S. export control suspension on semiconductor equipment to these companies in China scheduled for the 11th of next month, the Department of Commerce is expected to notify the companies of this policy soon, multiple sources told Korean media on the 26th (local time).

The indefinite suspension of export controls is expected to proceed in the form of updating the existing "Verified End User" (VEU) list. VEU is a type of comprehensive license that allows exports of designated items only to pre-approved companies. Once included in the VEU, there is no need to obtain separate approvals for each transaction, effectively meaning that U.S. export controls are suspended indefinitely.

The Bureau of Industry and Security (BIS) of the Department of Commerce has been discussing the detailed specifications, such as the list of equipment that Samsung Electronics and SK Hynix can import, and it is reported that these discussions have been virtually concluded. The Department of Commerce will notify the companies once an official decision is made and then publish it in the Federal Register.

The effect of the indefinite suspension is said to take effect from the time the companies are notified via letters or other means, and once notified, it means that the uncertainty surrounding the Korean companies' business operations in China will be resolved.

The level of equipment allowed for import through the VEU is expected to be higher than the current U.S. export controls on China. This is because the designation of equipment items that can be imported will reflect not only Samsung Electronics and SK Hynix’s current semiconductor production in China but also their future business plans.

One source said, "Since equipment upgrades sufficient for business over the next few years are also necessary, the technological level itself will inevitably be higher than under the control measures." However, it is also reported that the notification to the companies could occur as early as next week during the Department of Commerce’s discussions. Another source said regarding the timing of the announcement, "It is highly likely to be this week, but we need to wait and see when the final notification will be made."

On October 7 last year, the Department of Commerce announced export controls that effectively prohibit U.S. companies from exporting semiconductor equipment to Chinese semiconductor manufacturers. Specifically, companies must obtain permission to sell equipment and technology capable of producing logic chips using FinFET technology (16nm to 14nm or below), DRAM of 18nm or below, and NAND flash with 128 layers or more to Chinese companies. Subsequently, on October 11 of the same year, the Department of Commerce notified Samsung Electronics, SK Hynix, and others of a one-year temporary suspension of these export controls.

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