The United States has taken another ruthless move and demanded that no semiconductor factories aroun

Yesterday, May 15, 2020, was the first anniversary of Huawei being included in the "Entity List" by the United States. The US government issued a "big move"!

The Bureau of Industry and Security (BIS) under the U.S. Department of Commerce has announced a plan that it claims will limit Huawei's ability to use U.S. technology and software to design and manufacture its semiconductors abroad. The U.S. Department of Commerce believes that Huawei entrusts foundries with U.S. equipment to produce semiconductors, which undermines the purpose of the entity list. The new plan will make it impossible for Huawei to avoid U.S. export controls again, as long as it uses chips produced by U.S.-related technology and equipment. All require permission from the U.S. government.

“Absurd!” “Shocked!” Many people working in the semiconductor industry describe their feelings this way.

why? Because there is no chip in the world that can be produced without using American equipment or software technology.

This means that no matter what kind of chips Huawei produces - whether it is mobile phone chips, artificial intelligence chips, base station chips, or server chips, whether the production process uses a 7nm process or a 5nm process, they will all be controlled by the United States. In other words, every chip produced by Huawei in the future will need to be approved by the U.S. government. This is really going to involve all the efforts of the U.S. technology community to kill Huawei!

According to the content of the previous ban, Huawei will not be able to import products from overseas with US technology content higher than 25%. Later, there was news that this ratio would be reduced to 10%. However, the US has not yet reached an agreement on this ratio and has been wavering. . As a result, yesterday's ban directly skipped 10% and became 0.

So why will the ban be further escalated?

Based on the original restrictions, the United States thought that Huawei would not be able to import products with more than 25% of American technology content from overseas. However, what they did not expect was that the most critical TSMC foundry part actually successfully and legally compliantly avoided the 25%. limit. Therefore, there will be talk of reducing the 25% to 10% later. The industry has also demonstrated that even if the US technology content is reduced to 10%, it is very likely that some of TSMC's process technologies can still "fly at low altitude", and even TSMC's latest 7nm and 5nm processes may avoid the US. Regulation.

Therefore, now the United States has simply taken action and directly requires all semiconductor factories that manufacture for Huawei to obtain approval from the U.S. government.

This ban reveals a terrible signal - if the United States can use this extreme method to completely block Huawei today, then tomorrow, the United States can use the same method to block any Chinese technology company.

Do you still remember the previously reported news that the United States has launched an unlimited traceability mechanism for domestic semiconductor foundries? At that time, some netizens expressed the same concern: If today the United States could require Chinese domestic companies engaged in military-civilian integration or supplying integrated circuits for military products, they should not use semiconductor equipment from listed manufacturers in the United States to manufacture military integrated circuits, and at the same time, there would be an "unlimited traceability" mechanism. It will take effect; then tomorrow, can the United States also require these companies not to use semiconductor equipment from listed manufacturers in the United States to produce all civilian chips?

Faced with such a level of attack, China will certainly not sit still and wait for death!

Recently, a reporter from the Global Times learned from Chinese government sources that if the United States finally implements the above-mentioned plan, China will fight back forcefully to safeguard its legitimate rights and interests.

Specific countermeasures options available to China include the following: adding relevant U.S. companies to China’s “Unreliable Entity List” and targeting U.S. companies such as Qualcomm, Cisco, and Apple in accordance with laws and regulations such as the Cybersecurity Review Measures and the Anti-Monopoly Law. Enterprises have been restricted or investigated, and the purchase of Boeing aircraft has been suspended.

Perhaps affected by this news, before the U.S. stock market opened on the 15th, the stock prices of the four U.S. companies mentioned above fluctuated violently. Qualcomm once fell by more than 7% within 2 hours, and Apple, Boeing, and Cisco all fell by more than 4%. At present, the stock price declines of the four companies have narrowed and rebounded.

More news needs to be awaited by the Ministry of Foreign Affairs.

Finally, here is the full text of the article published by the U.S. Department of Commerce:

"The Department of Commerce responds to Huawei's efforts to weaken the Entity List and restrict its use of products designed and produced with U.S. technology"

The U.S. Bureau of Industry and Security (BIS) today announced a new plan to protect U.S. national security by limiting Huawei’s ability to use U.S. technology and software to design and manufacture semiconductors overseas.

The announcement cuts off Huawei's efforts to weaken U.S. export controls.

BIS is revising its long-standing direct products rules and entity list produced abroad to narrowly and strategically target Huawei’s transactions to acquire semiconductors that are direct products of certain U.S. software and technology.

Since BIS placed Huawei and its 114 overseas affiliates on the Entity List in 2019, companies wishing to export U.S. products must obtain a license. However, Huawei continues to use U.S. software and technology to design semiconductors and undermines the national security and foreign policy purposes of the Entity List by entrusting overseas foundries with U.S. equipment to produce semiconductors.

"Despite last year's Entity List action by the U.S. Department of Commerce, Huawei and its foreign affiliates have stepped up efforts to undermine these national security-based restrictions through localization efforts. However, such efforts still rely on U.S. technology ." said U.S. Commerce Secretary Wilbur Ross.

He believes: "This is not the behavior of a responsible global corporate citizen. We must modify the rules that are exploited by Huawei and HiSilicon and prevent American technology from triggering malign activities that are contrary to U.S. national security and foreign policy interests."

Specifically, this targeted rule change will subject the following foreign products to the Export Administration Regulations (EAR):

(1) Semiconductor designs and other products produced by Huawei and its affiliates (such as HiSilicon) on the Entity List are direct products of certain U.S. Commercial Control List (CCL) software and technologies;

(2) Chipsets and other products produced according to the design specifications of Huawei and its affiliates (such as HiSilicon) on the Entity List are direct products of certain CCL semiconductor manufacturing equipment located outside the United States. Such products manufactured outside the United States require a license only if it is known that they will be re-exported, exported from abroad, or transferred domestically to Huawei or any of its affiliates on the Entity List.

Some overseas foundries that use U.S. semiconductor manufacturing equipment have begun production according to the Huawei design specifications on May 15, 2020. In order to avoid direct adverse economic impacts on these chip foundries, such overseas-produced products will only be produced after the rules take effect. Re-exports, exports from abroad, or domestic transfers within 120 days of the date are not subject to these new licensing requirements.