Chipmaker United Microelectronics Corp (UMC, 聯電) said it would temporarily halt research and development (R&D) activities with its Chinese partner Fujian Jinhua Integrated Circuit Co Ltd (晉華集成電路), days after the US cut off the state-backed firm from US suppliers.
US President Donald Trump’s administration on Monday took action to cut off Fujian Jinhua from US suppliers amid allegations the firm stole intellectual property from US semiconductor company Micron Technology Inc.
The action against Fujian Jinhua could ignite new tensions between Beijing and Washington since the company is part of the “Made in China 2025” program to develop new high-tech industries.
The US Department of Commerce said it has put Fujian Jinhua on a list of entities that cannot buy components, software and technology goods from US firms.
“UMC will follow all government regulations and temporarily hold the R&D activities we are performing for Fujian Jinhua until we are cleared to resume by the appropriate authorities,” UMC said in a statement yesterday.
“The US ordered sanctions, [so] we will follow US government regulations as well,” head of investor relations Richard Yu (于恆祥) said.
He said UMC was not considered a “supplier” as the company does not export any products to Fujian Jinhua.
Attracting semiconductor expertise and talent from Taiwan has become a key part of an effort by China to put the chip industry into overdrive and reduce Beijing’s dependence on overseas firms for the prized chips that power everything from smartphones to military satellites.
UMC and Fujian Jinhua signed a technology cooperation agreement in 2016 for UMC to develop memory-related technologies for the Chinese firm, stock exchange filings showed.
“Jinhua will provide UMC with DRAM related equipment, as well as service fees to cover R&D expenses according to the progress of the technology development. The developed technologies will be jointly owned by both parties,” a statement said.
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