A source familiar with the matter reported that the United States has ordered Taiwan Semiconductor Manufacturing Co. (TSMC) to stop supplying advanced chips to Chinese clients beginning Monday. The U.S. Department of Commerce directive aims to restrict the export of certain high-tech chips, including those with 7-nanometer or more advanced designs commonly used in artificial intelligence and graphics processing units (GPUs), to Chinese companies.
The recent restriction follows TSMC’s report to the Commerce Department, indicating that a chip manufactured by TSMC was found in a Huawei AI processor, potentially breaching U.S. export controls. Tech Insights, a research firm specializing in technology, had analyzed the Huawei product and discovered the TSMC chip within, raising concerns of an export violation. Huawei, which is currently on the U.S. restricted trade list, requires suppliers to obtain special licenses for any technology shipments that might benefit its AI development. Given Huawei’s restricted status, obtaining such a license for AI applications would be improbable.
In response to this order, TSMC has suspended shipments to Sophgo, a China-based chip designer, after identifying that its product matched the chip found in Huawei’s AI processor, according to sources. It remains unclear how this chip ended up in Huawei’s Ascend 910B AI processor, released in 2022 and considered one of China’s most advanced AI chips.
The U.S. order is part of a broader effort to curb the potential circumvention of export controls, impacting additional companies and allowing U.S. authorities to investigate whether other firms may be diverting restricted chips to Huawei. Following receipt of the Commerce Department’s “is informed” letter—a mechanism enabling swift licensing requirements without formal rule-making—TSMC promptly notified its affected clients about the suspension of shipments effective Monday.
TSMC and Taiwan’s economy ministry have both stated their commitment to complying with export control regulations. TSMC confirmed it is “committed to adhering to all applicable rules and regulations.