Yangtze Memory Technologies, a manufacturer of chips, may soon be added to a trade blacklist as part of the Biden administration’s ongoing campaign to isolate Chinese technology firms that it sees as a security concern it is claimed by three sources with knowledge of the strategy that the US Commerce Department will add YMTC and other Chinese businesses to its “entity list” as soon as this week. US organisations are prohibited from selling technology to listed firms unless they have difficulty obtaining an export licence.
Two months ago, the US introduced strict export rules that made it more challenging for China to obtain and manufacture state-of-the-art semiconductors.
This year, it was revealed that YMTC may have transgressed US export laws by giving Chinese telecom equipment manufacturer Huawei Nand memory chips for its smartphones.
The Biden administration has been under pressure from US lawmakers for months to add the firm to the entity list. Additionally, lawmakers had warned Apple that if it moved forward with a proposal to purchase YMTC processors, it would come under intense scrutiny.
On October 7, the US implemented export regulations and added more than 30 Chinese businesses, including YMTC, to the “unverified list” of organisations for which the US has been unable to complete end-user verification to ensure American technology is not being redirected for unauthorised uses. It established a 60-day window for businesses to consent to US inquiries or risk being placed on the Entity List.
Last week, Alan Estevez, the chief export controls official for the Department of Commerce, claimed that China had finally changed its tune and was now permitting select companies to be inspected after a protracted period of non-cooperation.
The US, he claimed, was “seeing better behaviour” from China’s ministry of commerce, which is in charge of overseeing end-use inspections for Chinese businesses. But at the time, the US Commerce Department opted not to disclose the number of participating businesses.
Beijing, which this week complained to the World Trade Organization regarding the export controls of October 7, is sure to object to the YMTC move. YMTC has been referred to as a “national champion” by the White House.
The Biden administration is anxious that YMTC may sell memory chips below cost and put pressure on US rivals like Micron as well as businesses in allied nations. This worry is in addition to worries that YMTC broke US law.
The US-China tech conflict has escalated once again as a result of this action. Washington is attempting to hinder China’s ability to develop technology with military uses, such as artificial intelligence, nuclear weapon modelling, and the development of hypersonic missiles. As the US and its allies put more pressure on China, China has also been taking steps to strengthen its domestic technology capabilities.