U.S. gives reprieve from export curbs to at least two non-Chinese chipmakers in China – sources

By Jane Lanhee Lee, Karen Freifeld and Alexandra Alper

OAKLAND, Calif and WASHINGTON (Reuters) -The U.S. government on Tuesday allowed at least two non-Chinese chipmakers operating in China to receive restricted goods and services without their suppliers seeking licenses, easing the burden of a new crackdown on the Chinese chip sector, according to industry sources.

The Biden administration had planned to spare foreign companies operating in China such as South Korean memory chip makers SK Hynix Inc and Samsung Electronics (OTC:) Co from the brunt of new restrictions, but the rules published on Friday failed to exempt such firms, the sources said.

As published, the rules require licenses before U.S. exports can be shipped to facilities with advanced chip production in China, as part of a U.S. bid to slow Beijing’s technological and military advances.

The U.S. had planned to grant licenses to supply non-Chinese chip factories on a case-by-case basis, while licenses to Chinese chipmakers will face a presumption of denial.

As of midnight Tuesday, vendors also cannot support, service and send non-U.S. supplies to such China-based factories without licenses if U.S. companies authorize, direct or request them.

But whether a license is approved or not, the time it takes to get through the license process could create delays in shipments and halt production.

A U.S. Commerce Department spokesperson did not directly respond to a request for comment on the authorizations, but said the department hopes to get input from stakeholders about the rule and may consider changes.

A White House spokesperson also did not respond to a request for comment.

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