The US Federal Trade Commission added the Chinese semiconductor company SMIC to the ban list and banned dealing with it by US technology companies, as the new episode in the US ban series of Chinese companies came through a circular that was sent to tech industries companies in the United States last Friday.
This circular prohibits the export of any technology to SMIC on the grounds that it poses an unacceptable risk in converting technologies into a final military product serving the Republic of China, that is, they pose an explicit threat and threat to US national security, while the Federal Trade Commission had approved many laws last April, Which has narrowed the screws on exporting products and goods to China, justifying that by seeking to prevent American companies from sending products that may be used to enhance the power of the Chinese army.
According to the Financial Times, American companies will now need to obtain a license before they are allowed to ship certain materials to SMIC in China, while SMIC responded via an official statement to the authority’s decision, in which it said that it manufactures semiconductors and provides services for commercial purposes and for the end user only. , Explaining that it has no relationship with the Chinese army and does not manufacture any end products for the user or military uses.
Perhaps the sanctions imposed on SMIC are not as stringent as those imposed by the United States on Huawei, however, the US is reportedly considering taking tougher measures against SMIC including the possibility of placing the company on the Entity List, and again in May 2019, the United States placed a company. Huawei is in the same list, which prevents the latter from reaching the US supply chain, and also requires US companies to obtain licenses before they do business with the manufacturer.
According to analysts at Jefferies Securities, the United States is stepping up its attack on the semiconductor industry in China, and more companies are inevitably listed. On the other hand, the Chinese government is not pleased. Foreign Ministry spokesman Zhao Legian accused the United States of “blatant bullying.” He added that what it did violated international trade rules, undermined global industrial supply and value chains, and would inevitably harm the national interests of the United States and its image.
Jefferies analysts believe that half of SMIC’s equipment comes from the United States and that the company, which is valued at nearly $ 29 billion according to the stock company, does business with major US chip makers including Qualcomm and Broadcom.