From Definite to Indefinite Suspension
The U.S. government is reportedly set to indefinitely halt restrictions on the export of U.S.-made semiconductor equipment to Samsung Electronics and SK hynix factories in China.
The U.S. Commerce Department’s Bureau of Industry and Security (BIS) has been in talks with Samsung Electronics and SK hynix over details such as a list of the equipment that the two companies can take to China and discussion is virtually over, according to industry sources and the U.S. Commerce Department on Sept. 26 (local time).
The indefinite suspension of U.S. control on equipment export to China is expected to take the form of an update to the existing list of verified end users (VEUs). VEUs are a type of a blanket license system that allows for the export of specified items to pre-approved companies. Once a company is included in a VEU list, the company does not need to obtain a separate license. In effect, it is an indefinite suspension of U.S. export control. The notification of the indefinite suspension means that Korean companies will not face uncertainties in doing business in China.
Once an official decision is made, the U.S. Commerce Department will notify Samsung Electronics and SK hynix and publish it in the U.S. Federal Register.
“We want to make it clear that we will allow Korean semiconductor companies to continue their lawful business in China,” U.S. Commerce Secretary Don Graves told reporters on Sept. 21 during his visit to Korea. “We will do everything we can to make sure the Korean semiconductor companies will be able to continue their business.”
In October 2022, the U.S. Commerce Department announced U.S. export control that effectively prohibits U.S. companies from exporting semiconductor equipment to semiconductor makers in China. The control required companies to receive permits from the U.S. administration when the U.S. companies sell logic chips (16 nm to 14 nm) using fin field-effect transistor (FinFET) technology, DRAM (18 nm or smaller), and equipment and technology capable of producing 128 gigabytes or more of NAND flash memory to Chinese companies.
On Oct. 11 2022, the U.S. Department of Commerce notified Samsung Electronics and SK hynix of a one-year suspension of exports.