U.S. Commerce Department New Rules Aim to Keep Advanced Computer Chips Away from China

Commerce Department updates export controls to safeguard advanced computer chips, aiming to prevent acquisition by China. Details on the new rules are here.

Oct 17, 2023 - 09:29
Oct 17, 2023 - 09:29
U.S. Commerce Department New Rules Aim to Keep Advanced Computer Chips Away from China
U.S. Commerce Department New Rules Aim to Keep Advanced Computer Chips Away from China

The Commerce Department has updated its rules to prevent China from getting hold of advanced computer chips and the equipment needed to make them.

This comes about a year after the first set of rules was introduced. These controls were put in place to stop the chips from being used for military purposes, like creating hypersonic missiles and artificial intelligence.

Commerce Secretary Gina Raimondo explained that these controls are meant to protect technologies that are important for national security or human rights. She also emphasized that most computer chips will not be restricted. However, if there are concerns about national security or human rights, they will act accordingly.

The changes were made after consulting with experts in the field and conducting technical studies. They've introduced a kind of "gray area" that will be watched closely for chips that could still be used for military purposes, even if they don't fully meet the standards for trade restrictions.

The export of chips can also be limited to companies based in Macao or those under a U.S. arms embargo. This prevents countries of concern from bypassing the controls and supplying chips to China.

The new rules also make it harder for China to produce advanced chips outside of the U.S. The list of manufacturing equipment under export controls has also been expanded, among other policy adjustments.

The initial export controls caused tension with the Chinese government, which sees the design and production of high-level semiconductors as crucial for its economic and geopolitical aims. Raimondo clarified that these restrictions aren't meant to hinder China's economic growth.

In August, Raimondo and Chinese officials agreed to share information about export controls. However, a senior U.S. official, speaking anonymously, said that the U.S. didn't discuss the details of the revised controls with China.

Chinese Premier Li Qiang has called for concrete actions from Washington to improve relations, referring to Chinese concerns about U.S. policies on technology, Taiwan, and other matters.

Chinese government officials are scheduled to attend the Asia-Pacific Economic Cooperation summit in San Francisco in November. President Joe Biden has suggested the possibility of a meeting with Chinese President Xi Jinping during the summit, though no confirmation has been made. The two leaders met last year after the Group of 20 summit in Bali, Indonesia, shortly after the initial export controls were announced.

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