Two key Republican members of Congress have joined together to urge the Trump administration to strengthen new rules enacted just last week to prevent China’s largest chipmaker, Semiconductor Manufacturing International, from gaining access to advanced U.S. technology.
Senator Marco Rubio and Representative Michael McCaul sent a joint letter to Commerce Secretary Wilbur Ross on Tuesday (Dec. 22) calling for tighter restrictions on SMIC.
In their letter to Ross, Rubio and McCaul said, “We are deeply concerned that the entity listing provisions against Semiconductor Manufacturing International Corporation (SMIC) would be completely ineffective in addressing the growing national security threat.”
Senator Rubio is co-chair of the Congressional-Executive Commission on China, and Representative McCaul is chairman of the House Republican China Working Group.
Rubio and McCaul believe that the U.S. Department of Commerce’s entity list designations are not sufficiently stringent and should be rewritten to close “dangerous loopholes” that allow virtually all sales to SMIC to continue unrestricted and in support of the Chinese Communist Party’s stated goal of “military superiority.
They are concerned that without timely changes to these rules, the United States will accomplish nothing to address this growing national security threat.
In their letter, the lawmakers also wrote that SMIC poses a clear threat to U.S. national security and that the entity listing designation for SMIC does not effectively mitigate national security risks. The Commerce Department’s pre-determined restrictions on “unique” items required for semiconductor production at 10nm and below appear to allow SMIC access to virtually all semiconductor manufacturing equipment; this undermines the effectiveness of its minimum initial intent.
In the view of Representatives Rubio and McCaul, SMIC will not actually face severe restrictions because few products can be “unique” tools for producing a certain chip size. In fact, SMIC has publicly stated that the U.S. entity list determination has no material adverse impact on the company’s short-term operations. Therefore, we are deeply concerned that SMIC’s listing is “for show”.
Rubio and McCaul agreed with some stock analysts that SMIC will eventually be able to circumvent the restrictions and urged the Trump administration to treat the chipmaker similarly to “huawei.
The Commerce Department declined to comment to the media, but Commerce Secretary Ross said last week that the entity listing for SMIC is a necessary measure to ensure that China cannot use U.S. technology to support its destabilizing military activities through its industry leader, SMIC.
Although the Trump administration has less than a month left in office, Rubio and McCaul’s letter to the Commerce Secretary on Tuesday suggests that some key U.S. politicians will continue to pressure incoming President Joe Biden and his officials to maintain a tough stance on Chinese companies in 2021.
SMIC said Sunday that being placed on the U.S. trade blacklist by the U.S. Department of Commerce will have a significant adverse impact on its development of 10nm and more advanced chip technology; however, it does not expect the U.S. decision to have a significant negative impact on its short-term operations and finances.
Recent Comments