Reuters Washington 5 15- Trump government's move on Friday to block the global supply of chips to previously blacklisted telecoms equipment giant Huawei technology companies sparked fears of retaliation against China and hurt U.S. chip-equipment makers' shares.
Photo: January 2020, American flag, a flag, a smart phone showing Huawei corporate logo and 5 G patterns and a computer motherboard. REUTERS/Dado Ruvic
Earlier, Reuters first reported that the U.S. Department of Commerce said it was revising an export rule to "strategically lock in Huawei semiconductor purchases directly from specific U.S. software and technology. "Adjusted to the rules, foreign companies using United States chips to manufacture equipment will need United States permission to supply certain types of chips to Huawei or Huawei affiliates such as Hayes Semiconductor.
A senior Commerce Department official told journalist : " at a telephone briefing Friday that the move was a reflection of U.S. priorities, U.S. corporate priorities, and U.S. national security priorities. "
The world's largest telecoms equipment maker Huawei not responded to journalist request for comment.
The news of new U.S. action against Huawei hit European stocks, with traders taking a profit from intraday gains, and chip-equipment makers such as Colin R & D (Lam Research) and KLAC.O (KLAC.O) fell about 5% and 3% respectively in the U.S.
China quickly responded, the global times reported on friday, that if the u.s. further "snagged" Huawei to stop tsmc and others from supplying chips to the Huawei, china would respond forcefully, including by including u.s. companies in the "list of unreliable entities ".
The measures include restrictions or investigations on u.s. companies such as qualcomm (QCOM.O), cisco (CSCO.O), apple (AAPL.O) and suspension of purchases of boeing (boeing) aircraft, the report quoted sources as saying.
Commerce Department said it would allow the production of wafers to be supplied to Huawei, within 120 days from Friday. That is to say, by Friday, the chip must have been put into production, otherwise it will not meet the regulations. The rules also hit tsmc (2330. TW), the world's largest wafer manufacturing company and Huawei's main supplier, which announced plans to build a plant in the us on thursday.
TSMC said on Friday it was "following closely changes in U.S. export rules" and working with external law consultants to "conduct law analysis and ensure a comprehensive assessment and interpretation of these rules. "
The U.S. Department of Commerce says the rule aims to cut Huawei attempts to evade U.S. export controls, meaning that suppliers with sophisticated U.S. manufacturing technology must obtain licenses from U.S. government before selling products to Huawei.
"Huawei are actually taking advantage of a highly technical loophole by using U.S. technology through overseas chip makers ," U.S. Business minister Ross told Fox Business News on Friday. He called the adjustment "tailored to close the hole ".
Last year, the United States added Huawei to the Commerce Department's "list of entities" on national security grounds, Washington accused the company of violating United States sanctions against Iran and of having equipment that could spy on customers. Huawei denied these accusation.
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The Washington lawer Kevin Wolf, a former commerce ministry official, said the new rules appeared to be a "new and complex extension of the scope of export controls" for chip-related products manufactured overseas and sold to Huawei using u.s. technology. The chips designed by companies other than Huawei and made using U.S. technology can still be sold to Huawei. without permission, he said
While the new rules will apply to all chips, regardless of their technological sophistication, a senior us state department official who also attended a telephone briefing on friday suggested that the new rules could give companies some flexibility, in line with Trump government previous practice of giving Huawei broad deadlines.
This provision requires enterprises to apply for licences. "This does not necessarily mean that the application will be rejected ," the official said, adding that the provision would allow the United States government to" learn "more about Huawei shipments. "How these applications are handled will be left to see... each application will be assessed on a case-by-case basis. "
after effectively banning us suppliers from supplying Huawei, the commerce department issued licenses to some of Huawei largest partners in the us, allowing them to continue selling products to Huawei, while also allowing smaller rural telecom operators to continue buying Huawei equipment to keep their networks functioning.
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Although the rules were designed to snap Huawei "the neck" and would hit the chipmakers on which it relied, american chipmakers might face long-term suffering if they developed new sources of equipment beyond the limits of the us rules.
Yet for the time being, most chipmakers rely on equipment produced by American companies such as KLA、LAM Research and application materials (Applied Materials)(AMAT.O). None of the companies responded to requests for comment.
While some of the complex equipment needed to make chips comes from companies outside the United States, such as Tokyo Electronics (8035. T) and Hitachi (6501. T) in Japan, and Esmore (ASML.AS) in the Netherlands, analysts say it is difficult to assemble complete tool chains capable of manufacturing advanced semiconductors without using U.S. equipment at all. (concluded)
