The U.S. may changeregulations to allow it to block shipments of chips to Huawei Technologies from companies such as Taiwan’s TSMC.
According to Reuters, the new restrictions on commerce with China’s Huawei are among several options to be considered at high-level U.S. meetings this week and next.
To target global chip sales to Huawei, U.S. authorities would alter the Foreign Direct Product Rule, which subjects some foreign-made goods based on U.S. technology or software to U.S. regulations.
Reuters reported possible changes to that rule in November.
The U.S. government will force foreign companies that use U.S. chipmaking equipment to seek a U.S. license before supplying Huawei.
Most chip manufacturers rely on equipment produced by U.S. companies like KLA, Lam Research and Applied Materials. In fact, there is no production line in China that uses only equipment made in China, so it is very difficult to make any chipsets without U.S. equipment.
Huawei and TSMC did not provide any comment.
The measure would be a blow to Huawei as well as to TSMC, a major producer of chips for Huawei’s HiSilicon unit and mobile phone rivals Apple and Qualcomm.
Huawei is at the heart of a battle for global technological dominance between the United States and China. The United States is trying to convince allies to exclude its gear from next generation 5G networks on grounds its equipment could be used by China for spying. Huawei has repeatedly denied the claim.
The United States placed Huawei on a blacklist in May last year, citing national security concerns. That forced some U.S. and foreign companies to seek special licenses from the Commerce Department to sell to it, but China hawks in the U.S. government have been frustrated by the vast number of supply chains beyond their reach.