Huawei, SMIC facing Taiwan ban amid escalating chip tensions

Taiwan has taken an aggressive step against the chip champions, Huawei and SMIC, by imposing a ban. After the US prompts, the Taiwanese government is tightening semiconductor controls on top Chinese companies, intensifying global tech tensions.

As per the details, Taiwan banned Huawei and SMIC for national security reasons. The country already had strict chip regulations in China. But it further tightened them.

Under the updated chip rules based on the Taiwan ministry’s trade administration website, Taiwanese companies will require government approval before exporting any chip tech products to the blacklisted Chinese companies.

“Manufacturers must comply with export control regulations, fulfill their verification obligations, and carefully assess transaction risks,” said Taiwanese authorities.

It’s not the first time that Taiwan has banned China over security concerns. Years ago, the country stopped exporting key chip manufacturing tools, like photolithography – a process of engraving circuits on wafers with light. But for the first time, the country has blacklisted some major Chinese firms.

US has already sanctioned Huawei and SMIC from accessing advanced chip technologies. As of now, Taiwan is taking a similar approach towards China with an even bigger impact to avoid any loopholes in the ongoing chipset export controls.

Huawei, SMIC facing Taiwan ban amid escalating chip tensions (Image Credits: Huawei)

The Taiwanese government believes that the new updated chip sales regulations will also reduce collaboration between Chinese and Taiwanese tech companies.

Inputs reveal around 601 new companies on the entity list, including the ones from Taliban, al-Qaeda, and the high-profile firms from Russia, Pakistan, Iran, Myanmar, and China, with Huawei and SMIC.

Taiwan took this step based on the prevention of arms proliferation and other national security considerations. It reviewed and updated the entity list on June 10.

Since Taiwan is a host to many significant chip companies, including the popular chipmaker TSMC, a new ban from the country’s side on Huawei and SMIC can further increase problems in the Chinese chip industry.

Last year, the US asked TSMC to pause its chipset supply after finding one of the company’s advanced chip components in Huawei’s AI product. In the latest edition, Taiwan is trying to partially block Huawei and SMIC access to its firms to meet AI semiconductor requirements.

The new ban hit Huawei and SMIC at a time when both companies are pouring efforts to bridge the technological gap between China and the US. Only time can unveil how these companies will counter the new situation to build the success route.

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