US mulls banning memory-making equipment from China • The Register

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Memory vendors Samsung and SK Group could be the latest victims of US efforts to derail China’s semiconductor industry.

Citing unnamed sources familiar with the matter, Reuters reports that the United States is considering measures that would, among other things, limit shipments of US-made chipmaking equipment used to produce memory technologies with more than 128 layers. to China.

Unlike previous export bans, the measures would not be limited to Chinese memory suppliers like Yangtze Memory Technologies Co. (YMTC) and would instead extend to any company operating in the region. That puts Samsung and SK Group — both of which produce 176-layer NAND flash memory in high volumes — right in the blast radius should the Biden administration go ahead with another round of Chinese trade restrictions.

South Korean foundries have substantial investments in China. SK Group is also in the process of acquiring Intel’s memory and NAND storage business in a deal valued at around $9 billion. The acquisition includes Intel’s NAND manufacturing facility in China’s Dalian province. Samsung also operates two memory factories in Xi’an and Suzhou in China.

However, Reuters reports that the measures are still in the early stages of development.

The rumors come less than a week after the US Congress passed a $280 billion bill aimed at bolstering US investment in domestic semiconductor manufacturing and scientific research. And it is reported that China wants to spend about 150 billion dollars until 2030 for silicon manufacturing.

A risky proposition

It remains to be seen whether the White House would risk derailing a $20 billion investment by SK Group – the parent company of SK hynix – announced last week, to build a semiconductor package and battery technology in the United States. United.

Samsung, which is reportedly weighing a $200 billion foundry expansion in Texas that would see nearly 11 manufacturing plants built outside of Austin, is also unlikely to look favorably on tougher trade restrictions.

It is also unclear whether the rumored export ban would have the intended effect. Previous attempts to block China from accessing US-made semiconductor manufacturing equipment and intellectual property have had mixed results.

In the final days of the Trump presidency, the US Department of Commerce banned several China-based companies, including Semiconductor Manufacturing International Corp’s (SMIC), from importing US chipmaking equipment.

The export ban was intended to prevent the manufacturer from producing chips based on a 10nm process or less. Despite these measures, the SMIC would have obtained the means to produce 7 nm chips.

Previously, it was believed that the Chinese only recently succeeded in increasing the production of 14nm chips. By comparison, Intel produces chips on a 10nm process, with 7nm chips slated for release next year, and TSMC and Samsung are rolling out their 3nm process node. (Remember, though, that these process node sizes are manufacturer-defined rather than actual feature size.)

Financial problem

Despite recent victories, China’s efforts to catch up with rival nations in the semiconductor field have not been without challenge and controversy.

This week, Reuters reported that China’s Central Commission for Discipline Inspection (CCDI) – the country’s corruption watchdog – was investigating Ding Wenwu, who heads the Investment Industry Investment Fund. integrated circuits from China, on allegations of “serious violations of the law”.

The fund, better known as the “Big Fund”, was established in 2014 with the aim of aligning China’s semiconductor and design capabilities with those of the United States, South Korea and from Taiwan. He has raised tens of billions of dollars to support local chipmakers including SMIC and YMTC.

However, the Big Fund has also been a source of controversy. According to Reuters, the CCDI opened an investigation into the fund’s former chief Lu Jun last month, citing similar alleged violations.

And allegations of corruption and misconduct aren’t the only problems China’s semiconductor factories face.

Tsinghua Unigroup, a major Chinese chipmaker and foundry operator responsible for mobile chip design, NAND flash manufacturing, IoT, security chips and IT infrastructure, received a $9 bailout. billion from a government-backed rating management firm this spring after racking up more than $30 billion in debt. ®

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