Here is Biden’s plan to curb chip sales to China
The U.S. Department of Commerce will soon present a regulation to limit exports to China of advanced chips, such as those for artificial intelligence. All the details
Biden's plan to curb chip sales to China is ready.
According to Reuters , the United States plans to expand restrictions on exports to China of advanced chips, such as those for artificial intelligence, and semiconductor manufacturing equipment. They will do so through new regulations that will be published next month, and which will be based on the limitations that the Commerce Department has already communicated in letters to three companies: KLA, Lam Research and Applied Materials, all based in California.
THE PROHIBITION OF THE DEPARTMENT OF TRADE
The ministry – led by secretary Gina Raimondo – has in fact banned them from selling devices for the production of chips to Chinese factories that make semiconductors smaller than 14 nanometers (the most advanced are those of 3 nanometers), unless they obtain licenses. specifications issued by the same department.
THE CASE NVIDIA-AMD
Reuters writes that the new rules will also codify the restrictions recently imposed by the Commerce Department on NVIDIA and AMD (also Californian), which forced the two companies to stop selling artificial intelligence chips to China. where they could be used for military applications.
– Read also: What China does (and will do) on microchips, telco and digital
THE IS-INFORMED LETTERS
All these limitations have been put in place by the department through the so-called is-informed letters: they have the advantage of allowing the rapid implementation of export control mechanisms, bypassing the much longer time required for drafting the regulations; on the other hand, however, the letters are valid only for the companies that receive them.
Turning the letters into real rules means expanding their reach, subjecting all American chip companies to the same conditions: Intel and Cerebras Systems (also California), for example, want to challenge the leadership of NVIDIA and AMD in the sector. of chips for artificial intelligence.
NOT JUST CHIP
A Reuters source said future Department of Commerce legislation will require licensing not only for semiconductors destined for China, but also for products containing them. American computer systems companies such as Dell, HP and Supermicro build servers for data centers containing NVIDIA A100 chips, the ones subject to the Washington restrictions.
NATIONAL SECURITY
A senior Commerce Department official told Reuters that "as a general rule, we try to codify any restrictions contained in the is-informed letters with a regulatory change."
A spokesman said instead that the ministry is "taking a comprehensive approach to implement further actions to protect US national security and foreign policy interests", namely to prevent China from acquiring US technology with which to modernize its industries and their own armed forces.
– Read also: Chip, Taiwan winks at the US by blocking Foxconn's business in China
BIDEN'S GOAL AND THE DIFFERENCES WITH TRUMP
It has long been known that the administration of President Joe Biden wants to avoid contributing to the development of dual use technologies (that is, they have dual use, both in civil and military spheres) by Beijing.
The goal is basically the same as ex-president Donald Trump, but the approach changes. One of the differences is that Biden has transferred the competence on the compilation of blacklists of foreign companies and export regulations from the Department of Defense to those of the Treasury and Commerce, probably to ensure better legal compliance with the various measures.
THE TECHNOLOGICAL CHALLENGE WITH CHINA
The Commerce Department's regulatory action is part of the Biden administration's broader plan to halt China's technological advancements.
"The strategy", explained Jim Lewis, CSIS technology analyst, "is to block China, and [the United States, ed ] have discovered that chips are a bottleneck" because Beijing's manufacturing capacity is limited. and the country depends on imports. At least for the moment “they can't produce this stuff, they can't produce the production equipment,” Lewis added; however, China is working and investing to achieve self-sufficiency.
Referring to the Biden administration's plan and the possible repercussions on American companies, Clete Willems – a former Commerce official under Donald Trump – said that "coordination with allies is the key to maximizing effectiveness and minimizing unwanted consequences. "Of the new regulations. "This should favor broader regulations that others can replicate instead of one-time is-informed letters."
– Read also: Here is the US state aid for the production of microchips
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/stati-uniti-restrizioni-vendita-chip-cina/ on Mon, 12 Sep 2022 08:49:41 +0000.