The US will attempt to block TSMC from manufacturing chips for Huawei.
NEWS FROM REUTERS, MAY 15, 2020
A new rule, unveiled by the Commerce Department and first reported by Reuters, expands U.S. authority to require licenses for sales to Huawei of semiconductors made abroad with U.S. technology, vastly expanding its reach to halt exports to the world’s No. 2 smartphone maker.
The Commerce Department’s rule, effective Friday but with a 120-day grace period, also hits Taiwan Semiconductor Manufacturing Co Ltd (2330.TW), the biggest contract chipmaker and key Huawei supplier, which announced plans to build a U.S.-based plant on Thursday.
TSMC said on Friday it is “following the U.S. export rule change closely” and working with outside counsel to “conduct legal analysis and ensure a comprehensive examination and interpretation of these rules.”
“There has been a very highly technical loophole through which Huawei has been in able, in effect, to use U.S. technology with foreign fab producers,” Commerce Secretary Wilbur Ross told Fox Business News on Friday, calling the rule change a “highly tailored thing to try to correct that loophole.”
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