Lawmakers Want To Block US Purchases Of Chinese Chipmaking Equipment

Authored by Catherine Yang via The Epoch Times (emphasis ours),

A bipartisan group of lawmakers introduced the Chip EQUIP Act on Nov. 20, with the goal of prohibiting American companies from buying Chinese chipmaking equipment.

Rep. Zoe Lofgren (D-Calif.), ranking member of the House Science, Space, and Technology Committee, and Rep. Jay Obernolte (R-Calif.), chair of the Research and Technology Subcommittee, introduced the bill in the House. It was co-sponsored by Reps. Raja Krishnamoorthi (D-Ill.), John Moolenaar (R-Mich.), Greg Landsman (D-Ohio), and Erin Houchin (R-Ind.).

Sens. Mark Kelly (D-Ariz.) and Marsha Blackburn (R-Tenn.) are expected to introduce the bill in the Senate in early December.

The Chips EQUIP (Equipment Quality, Usefulness, and Integrity Protection) Act would prohibit companies that received CHIPS Act funding from buying specialized semiconductor manufacturing equipment from companies owned or controlled by the Chinese communist regime.

Lofgren stated that the CHIPS Act was meant to re-shore semiconductor manufacturing and that it was “common sense” to make sure it doesn’t support foreign adversaries.

“We must continue to put American manufacturing first and strengthen our supply chains to remain ahead of our adversaries, like China,” she said.

Obernolte said it was a also a matter of national security, and that tools used in domestic chipmaking should “meet the highest standards of reliability and integrity, reinforcing a resilient supply chain.”

Chinese companies that produce semiconductor manufacturing equipment comprise a minority of the global market, and primarily serve Chinese customers. Some of the biggest companies are Naura and Advanced Micro-Fabrication Equipment Inc (AMEC).

Companies in the United States, the Netherlands, and Japan produce most of the specialized equipment used in semiconductor manufacturing. In fact, they also supply Chinese companies with much of their chipmaking equipment.

According to a congressional report released last month Chinese companies purchased $38 billion worth of such specialized equipment last year, and did so legally despite the multilayered U.S. export controls meant to block China from accessing advanced semiconductor related technology.

China is dependent on foreign tools and technologies to further its quest of building out a self-reliant semiconductor supply chain, and has resorted to smuggling and other illegal activity in a few high profile cases to acquire the AI chips otherwise banned to the Chinese market.

Lawmakers have also long warned that various loopholes allow Chinese companies, including those with close ties to the Chinese military, to gain access to the very technology the United States wants to restrict in order to slow Beijing’s military buildup.

The Trump administration began taking steps this year to close some of these loopholes, but the measures have been paused after the recent U.S.-China bilateral meeting.