TLDRs;
- U.S. blacklists 32 global entities, including SMIC-linked Chinese firms, to restrict access to advanced semiconductor technology.
- Sanctions extend beyond China, targeting companies in Singapore, Taiwan, India, Iran, Turkey, and the UAE.
- Shanghai Fudan Microelectronics faces extra penalties for supplying Russian military technology.
- U.S. chipmakers face billions in losses as export restrictions cut off their largest market—China.
The United States has intensified its crackdown on China’s semiconductor sector, adding 32 new entities to its restricted trade list, including firms tied to Semiconductor Manufacturing International Corporation (SMIC).
Among the latest names are GMC Semiconductor Technology (Wuxi) and Jicun Semiconductor Technology, accused of helping SMIC obtain U.S.-made chipmaking equipment despite long-standing export controls.
The move by the U.S. Commerce Department reflects Washington’s continued push to prevent China from advancing its domestic chipmaking capabilities, particularly in areas with potential military applications.
New Firms Cited for SMIC Support
GMC Semiconductor and Jicun Semiconductor were singled out for securing advanced U.S. equipment on behalf of SMIC Northern Integrated Circuit Manufacturing (Beijing) Corp and Semiconductor Manufacturing International (Beijing) Corporation, both already blacklisted.
Under the new rules, shipments of U.S. technology to these firms will require government licenses, which are expected to be denied in nearly all cases.
Beyond these two companies, the updated list includes Shanghai Fudan Microelectronics Technology, a high-performance chipmaker linked to supplying Russia’s military. The Commerce Department said this connection triggered tighter restrictions aimed at curbing the spread of U.S.-origin technology to both Chinese defense projects and Russian war efforts.
Global Reach of Updated Sanctions
Although the bulk of the new restrictions focus on China, entities based in Singapore, Taiwan, India, Iran, Turkey, and the United Arab Emirates were also added.
This reflects what U.S. officials describe as increasingly “sophisticated circumvention networks,” in which foreign intermediaries attempt to bypass restrictions by funneling equipment and components back into China’s semiconductor ecosystem.
This pattern is not new. Analysts note that the latest action mirrors earlier enforcement measures, such as the 2018 blacklist of Fujian Jinhua Integrated Circuit Co., which also faced sanctions over national security concerns. The continuous additions suggest a steady tightening of controls as Washington doubles down on semiconductor-related security risks.
Economic Fallout for U.S. Firms
While the sanctions aim to curb China’s tech progress, they are also generating significant economic consequences for American companies.
A study by the Federal Reserve Bank of New York estimated that prior rounds of export controls wiped out $130 billion in market capitalization from U.S. semiconductor firms.
China, which accounted for over 31% of global semiconductor purchases in 2022, has long been one of the largest markets for American chipmakers. By restricting access to this demand, U.S. firms face declining revenues and profitability, with some companies struggling to replace lost business. Industry experts warn that as Washington prioritizes national security over commercial interests, these costs could deepen.
Looking Ahead
The Biden administration has repeatedly emphasized that limiting China’s access to cutting-edge chips is critical to preventing their use in military modernization and surveillance programs.
However, the broadening scope of sanctions, now spanning dozens of firms across multiple countries, underscores both the challenges of enforcement and the growing collateral impact on global trade.
With SMIC and its affiliates continuing to adapt through intermediaries, Washington’s latest measures illustrate the escalating nature of the U.S., China tech rivalry, a battle increasingly fought on the frontlines of semiconductor supply chains.
