US Considers Restricting Samsung and SK's HBM Supply to China: "No Immediate Impact Expected, Precautionary Measure to Block Inflow to China"

Bloomberg "US Considering Restrictions on HBM Supply to China"
Domestic Companies Closely Monitoring Situation
HBM Going to China Is Either Absent or Extremely Limited
"More of a Preemptive Block Than Immediate Sanctions"

The United States is currently reviewing whether the additional semiconductor control measures against China, scheduled to be announced next month, will include provisions that prevent Samsung Electronics and SK Hynix from supplying high-bandwidth memory (HBM) to China. Accordingly, our industry, including related companies, is closely monitoring the situation. Although the current scale of HBM supply to China is very small and significant damage is not expected immediately, there is a cautious atmosphere of carefully examining and preparing for the situation after the actual measures are announced.

According to major U.S. media outlets such as Bloomberg on the 1st, the U.S. government is reviewing sanctions that would block the supply routes of HBM, a key component in artificial intelligence (AI) chips, to China, and is also considering measures to prevent Samsung Electronics and SK Hynix from supplying HBM to China. The sanctions target products of HBM2 or higher, including the 4th generation HBM3 and 5th generation HBM3E, as well as the equipment used to manufacture them. Samsung Electronics and SK Hynix, along with the U.S. company Micron Technology, dominate the global HBM market and are mentioned as companies that would be directly affected by these sanctions. The U.S. is expected to control the export of HBM from Samsung Electronics and SK Hynix based on the Foreign Direct Product Rule (FDPR), which prohibits exports of products incorporating U.S. software or design technology, even if the products are made by foreign companies. The U.S. plans to leverage the fact that these two companies extensively use American design software and equipment from companies such as Cadence Design Systems and Applied Materials.

Regarding the reports in the U.S., Samsung Electronics and SK Hynix are reportedly taking a wait-and-see approach for now. The reports are not confirmed facts but remain at the "under review" stage, and some details appear unclear. An industry insider told this publication, "According to foreign media reports, it is still uncertain whether sanctions will extend to products made by Nvidia using HBM from our companies and then sold to China. It seems too early to decide on a response strategy." Bloomberg also reported, "It is unclear whether the new measures will block direct sales of HBM to Chinese companies or also prohibit the sale of semiconductors bundled with AI accelerators to China." In Samsung Electronics' case, it supplies HBM3 to Nvidia's AI accelerator H20 chip, which is currently allowed to be sold to Chinese companies.

However, the insider added, "There do not seem to be many Chinese companies actually using our HBM, so it is uncertain whether the sanctions will have a substantial impact." An Gi-hyun, Executive Director of the Korea Semiconductor Industry Association, said, "The U.S. sanctions should be seen as measures aimed at the future rather than the present." He added, "Currently, there are virtually no HBM products made by our companies exported to China, and the number of materials, parts, and equipment (SoBuJang) exported is extremely small, so immediate damage from the sanctions is unlikely. It appears that the U.S. is concerned about the possibility that Chinese companies might import and use products from Korean companies to strengthen their AI technology in the future, and is imposing sanctions preemptively to prevent this."

Meanwhile, the U.S. is also expected to include various types of semiconductor equipment in the scope of the sanctions in addition to HBM. The sanctions will also cover more than 120 Chinese companies. However, exceptions are likely to be made for key allies such as South Korea, Japan, and the Netherlands. The U.S. Department of Commerce, in a statement to Bloomberg attributed to a spokesperson, said, "We continuously assess evolving threats to protect U.S. national security and the technology ecosystem and update export controls accordingly. We are committed to working closely with our like-minded allies."

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