China’s leading maker of semiconductors has denied links to the country’s military following reports that Washington is considering stepping up its feud with Beijing over technology and security by imposing export controls that could disrupt manufacturing for the national industrial champion.
US regulators are considering adding Semiconductor Manufacturing International Corp (SMIC, 中芯國際) to the Entity List of foreign buyers that need government permission to acquire technology or components, according to the Wall Street Journal and other outlets. US officials are looking at whether SMIC plays a role in Chinese military development, they reported.
“We have no relationship with the Chinese military,” the company said in a statement.
SMIC products are “solely for civilian and commercial end-users and end-uses,” the chipmaker said, adding that it is “open to sincere and transparent communication” with Washington to resolve “potential misunderstandings.”
The US Department of Defense said it is working with other agencies to determine whether SMIC’s “actions” warrant adding the company to the Entity List, which is overseen by the US Department of Commerce.
“Such an action would ensure that all exports to SMIC would undergo a more comprehensive review,” Pentagon spokeswoman Sue Gough said by e-mail on Saturday, without saying why the review was launched, the Washington Post reported yesterday.
SMIC is a leader in the Chinese semiconductor industry built up by the Chinese Communist Party in an effort to reduce reliance on foreign technology.
US President Donald Trump’s administration is trying block Chinese access to US technology it worries might be used to make weapons or develop competitors to US industry, the Washington Post said.
Chinese companies, including Huawei, are developing their own processor chips and other technology, but factories that produce them require US manufacturing technology for which there are few alternatives, the Washington Post said.
SMIC said it previously was granted “validated end-user status” by the agency that would impose the export controls. Such status allows a Chinese company to export US technology without individually applying for a license.
SMIC started as a private company, but state ownership has steadily grown over time, to more than 45 percent of SMIC stock as of 2018, the Organisation for Economic Co-operation and Development said in a report issued last year.
Additional reporting by staff writer
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