China Accuses Nvidia, Other US Chipmakers Of Monopoly And Dumping

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Semiconductors that are 28nm or above are considered mature or legacy chips. Chinese chip makers, such as the Shanghai Manufacturing International Corp (SMIC), are familiar with the production of mid-end chips that are 14–28nm, with a limited production capacity for 7nm chips. Chips that are 5nm or below are in the high-end range.

Chinese firms sanctioned

Beijing's decisions came after the US Commerce Department on September 12 added 32 firms, including 23 Chinese entities, to its Entity List for national security reasons.

The US Commerce Department's Bureau of Industry and Security accused Shanghai Fudan Microelectronics and its several affiliates in Beijing, Shenzhen and Hong Kong, Shanghai Fukong Hualong Microsystem Technology Co, Shanghai Fuwei Xunjie Digital Technology Co and Sino IC Technology Co of acquiring or attempting to acquire US-origin items to support China's military modernization.

It said Shanghai Fudan Microelectronics and Sino IC Technology received a“Footnote 4 designation,” meaning that they are now subject to the US Export Administration Regulations (EAR). It said the two firms produced high-performance computing chips for artificial intelligence and other dual-use applications, and that Shanghai Fudan Microelectronics had supplied technology to Russian military end users.

It also sanctioned two suppliers closely linked to the heavily sanctioned SMIC. They are GMC Semiconductor Technology (Wuxi) Co Ltd and Jicun Semiconductor Technology (Shanghai) Co Ltd.

The bureau said that GMC and Jicun acquired US-origin semiconductor manufacturing equipment on behalf of SMIC Northern Integrated Circuit Manufacturing (Beijing) Co and Semiconductor Manufacturing International (Beijing) Corp without the required US licenses.

“Under the pretext of safeguarding international order and national security, the US is in fact engaging in unilateralist and bullying practices, placing its own interests above the development rights of other countries,” a Ministry of Commerce spokesperson said Monday.

The spokesperson said Washington's intention to sanction Chinese enterprises is questionable, given that Bessent and He planned to hold four-day meetings in Spain from September 14.

“The latest round of sanctions is a precision strike by Washington against China's technology sector, following crackdowns on Huawei and SMIC in previous years,” said a Hebei-based columnist called Chanming.“China's semiconductor sector is bearing the brunt, with 13 integrated circuit firms, including Fudan Microelectronics, now facing a potential cut-off from critical technologies.”

“Being tagged for high-performance computing chip applications means Fudan Microelectronics would be blocked not only from US technologies but also from any third-party products incorporating US intellectual property,” he added.“This long-arm jurisdiction could stop Fudan Micronelectronics from accessing electronic design automation (EDA) tools and wafer fabrication gear.”

Fudan Microelectronics said it had strengthened its strategic reserves of wafers and critical raw materials, expanding its inventory from about 600 million yuan at the end of 2020 to about 3.1 billion yuan (US435 million) by mid-2025, including 2.1 billion yuan in raw materials and work-in-progress.