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US mulls new curbs on China's access to AI memory chips, Bloomberg News says
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US mulls new curbs on China's access to AI memory chips, Bloomberg News says
Jul 31, 2024 1:51 PM

July 31 (Reuters) - The U.S. is considering unilateral

restrictions on China's access to AI memory chips such as those

made by Micron Technology ( MU ) and SK Hynix ( HXSCF ) and

equipment capable of making such semiconductors, as soon as next

month, Bloomberg News reported on Wednesday.

The measures are meant to prevent Micron, and South Korea's

SK Hynix ( HXSCF ) and Samsung from suppling Chinese firms

with high bandwidth memory (HBM) chips that are essential in

helping run complex generative artificial intelligence programs,

the report said, citing people familiar with the matter.

The U.S. Department of Commerce declined to comment, while

the companies did not immediately respond to Reuters requests

for comment.

If enacted, the new rule would capture HBM2 and more

advanced chips including HBM3 and HBM3E, as well as the tools

required to make them, the report said, adding that no final

decision on the restrictions has been made.

HBM chips are needed to run AI semiconductors such as those

sold by market leader Nvidia and aspiring competitor

AMD.

Micron will be largely unaffected as the chipmaker has held

back from exporting its HBM products to China after Beijing

banned its memory chips from critical infrastructure in 2023,

the report said.

It was unclear what authority the U.S. would use to restrict

the South Korean firms, the report said.

This could include the foreign direct product rule, or FDPR,

which lets the U.S. impose controls on foreign-made products

that use some amount of American technology, according to the

report.

SK Hynix ( HXSCF ) and Samsung extensively utilize technology from

American firms such as Applied Materials and Cadence

Design Systems.

While the new measures would curb direct sales of HBM chips

to Chinese companies, it's unclear whether selling high-end

memory chips bundled together with AI accelerators to China

would be permissible, the report said.

(Reporting by Arsheeya Bajwa in Bengaluru; Editing by Devika

Syamnath)

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