US tightens restrictions on Chinese chipmaker

The new rule requires US firms to get a license before importing products to the company

The US Commerce Department has added China’s largest chipmaker, Semiconductor Manufacturing International Corporation (SMIC), to its entity list, after it determined there an “unacceptable risk” that equipment SMIC received could be used for military purposes, Reuters reported.

The move blocks US computer chip companies from exporting technology to SMIC without an export license. SMIC is the latest major Chinese firm to be put on the entity list; the Trump administration added phone manufacturer Huawei to the list in 2019.

According to The Wall Street Journal, the Commerce Department wrote in a letter to the computer chip industry on Friday that exporting products to SMIC would “pose an unacceptable risk of diversion to a military end use in the People’s Republic of China.”

In April, the administration tightened export rules on shipping goods to China. It claims it’s seeking to keep US companies from selling products that could be used to help strengthen the Chinese military.

SMIC told Reuters in a statement that it makes semiconductors and provides services “solely for commercial end-users and end-uses,” and that it has “no relationship with the Chinese military and does not manufacture for any military end-users or end-uses.”