US Tightens Export Rules for Chipmakers Operating in China

• The US revokes key authorizations for Samsung and SK Hynix, limiting access to American chipmaking tools and reshaping global semiconductor dynamics.

License Revocations Signal Shift in Trade Policy

The United States has moved to restrict semiconductor production in China by revoking export authorizations previously granted to Samsung and SK Hynix. These exemptions, originally issued in 2022, allowed the South Korean firms to receive American chipmaking equipment despite broader restrictions. Under the new rules, both companies must now apply for licenses to continue importing such tools into China. Intel was also listed among affected firms, though its exit from China earlier this year through the sale of its Dalian unit reduces its exposure.

According to the Commerce Department, licenses will be considered for maintaining existing operations but not for expanding capacity or upgrading technology. This change is expected to impact U.S. equipment suppliers such as KLA Corp, Lam Research, and Applied Materials. Market reactions were swift, with shares of Lam falling 4%, Applied Materials down 2.8%, and KLA dropping 2.4%. The affected companies have not yet issued public responses to the policy update.

Trade Tensions and Strategic Implications

The decision comes amid ongoing trade friction between the U.S. and China, currently held in check by a tariff truce set to expire in November. Existing levies include 30% tariffs on Chinese imports to the U.S. and 10% duties on American goods entering China. A White House official previously indicated that revoking export authorizations was a preparatory measure in case trade negotiations deteriorated. The broader trade conflict has already influenced sectors ranging from rare earths to agricultural commodities.

Thousands of export license applications from U.S. firms remain pending, contributing to a growing backlog that includes billions of dollars in semiconductor equipment. The revocations will take effect in 120 days, giving companies limited time to adjust their supply chains. Samsung and SK Hynix had benefited from Validated End User (VEU) status, which streamlined shipments from U.S. suppliers. That designation will now be removed, adding further complexity to cross-border operations.

Market Impact and Competitive Shifts

The policy change may create opportunities for domestic Chinese equipment manufacturers to fill supply gaps left by restricted U.S. exports. These firms could see increased demand as foreign chipmakers face new hurdles in sourcing advanced tools. Micron, a U.S.-based competitor to Samsung and SK Hynix in the memory chip market, may also benefit from the shift. Reduced access to American technology could slow production growth for South Korean firms operating in China, potentially altering competitive dynamics.

While the affected companies have yet to comment, the long-term implications of the revocations are likely to influence investment decisions and regional manufacturing strategies. The move underscores the strategic importance of semiconductor technology in global trade and national security. As geopolitical tensions persist, further adjustments to export controls and licensing frameworks may follow. Industry stakeholders will be watching closely as the 120-day window progresses and new trade developments unfold.