BLOOMBERG
"Biden Wants Chipmakers Getting US Aid to Curb China Investments"
Jenny Leonard and Daniel Flatley
18 JULY 2022
(Bloomberg) -- The White House supports prohibiting semiconductor companies from expanding certain investment in China if they take new subsidies to build plants in the US under legislation the Senate’s set to begin debating Tuesday.
“We continue to support strong guardrails” in the legislation, White House Press Secretary Karine Jean-Pierre said Monday, referring to a provision of the bill that would limit China investments for companies that take some of the $52 billion the measure would dedicate toward US semiconductor manufacturing.
The incentives are intended to “generate more semiconductor investment here in the US, not in China,” Jean-Pierre said.
“And guardrails help slow the growth of investment in China."
"That is why it’s such an important part of the bill."
"We believe in strong guardrails.”
The China investment restrictions are still under negotiation and are a target of heavy lobbying by the semiconductor industry.
Intel Corp. and the industry’s main trade association, the Semiconductor Industry Association, have been lobbying against the restrictions as currently written, Politico reported earlier Monday.
Currently, the legislation would prohibit companies from expanding their semiconductor manufacturing in China for 10 years after they take a grant to build a US plant.
Companies could continue to invest in “legacy” chip manufacturing in China, but the definition of that term is unresolved.
Senate Majority Leader Chuck Schumer is set to tee up a procedural vote to start debate on the bill Tuesday.
https://www.msn.com/en-us/money/markets ... 60e41471f6
CHINA
Re: CHINA
RIGZONE
"China Gets Competition For Its Favorite Russian Oil From India"
by Bojan Lepic, Serene Cheong and Sharon Cho
Friday, July 22, 2022
India has ramped up purchases of crude from Russia’s far east, a grade that’s typically favored by Chinese oil refiners.
Four vessels hauling Russian ESPO oil are making their way to India, with two tankers heading for Paradip port on the east coast, where a refinery operated by Indian Oil Corp. is located, according to shipbrokers and data compiled by Bloomberg.
That compares with three vessels in June and one in April, said Emma Li, an analyst at Vortexa in Singapore.
State-owned Indian Oil didn’t immediately respond to a request for comment.
The trade is typically not attractive to Indian buyers due to the long distance from the Russian loading port of Kozmino and because ESPO crude cargoes are usually transported in aframax vessels, which carry smaller volumes.
However, the cheaper price compared with other grades from the Persian Gulf and West Africa are likely to have prompted the buying, according to traders.
Cargoes of ESPO can be shipped to China in around five days, and the nation’s refiners have been eagerly snapping up the cheap Russian barrels, which have displaced flows from other suppliers such as West Africa and Brazil.
--With assistance from Debjit Chakraborty.
https://www.rigzone.com/news/china_gets ... 0-article/
"China Gets Competition For Its Favorite Russian Oil From India"
by Bojan Lepic, Serene Cheong and Sharon Cho
Friday, July 22, 2022
India has ramped up purchases of crude from Russia’s far east, a grade that’s typically favored by Chinese oil refiners.
Four vessels hauling Russian ESPO oil are making their way to India, with two tankers heading for Paradip port on the east coast, where a refinery operated by Indian Oil Corp. is located, according to shipbrokers and data compiled by Bloomberg.
That compares with three vessels in June and one in April, said Emma Li, an analyst at Vortexa in Singapore.
State-owned Indian Oil didn’t immediately respond to a request for comment.
The trade is typically not attractive to Indian buyers due to the long distance from the Russian loading port of Kozmino and because ESPO crude cargoes are usually transported in aframax vessels, which carry smaller volumes.
However, the cheaper price compared with other grades from the Persian Gulf and West Africa are likely to have prompted the buying, according to traders.
Cargoes of ESPO can be shipped to China in around five days, and the nation’s refiners have been eagerly snapping up the cheap Russian barrels, which have displaced flows from other suppliers such as West Africa and Brazil.
--With assistance from Debjit Chakraborty.
https://www.rigzone.com/news/china_gets ... 0-article/
Re: CHINA
REUTERS
"China says U.S. chip act will distort global semiconductor supply chain"
Reuters
July 29, 2022
HONG KONG, July 29 (Reuters) - China's commerce ministry said on Friday that a major new chips act passed by the U.S. Congress will distort the global semiconductor supply chain and disrupt international trade.
The U.S. House of Representatives passed the sweeping legislation on Thursday to subsidise the domestic semiconductor industry as it competes with Chinese and other foreign manufacturers.
China will continue to monitor the progress and implementation of the U.S. act and take meaures to safeguard its legitimate rights when necessary, the ministry said in a statement.
Reporting by Meg Shen and Twinnie Siu; editing by Jason Neely
https://www.reuters.com/technology/chin ... 022-07-29/
"China says U.S. chip act will distort global semiconductor supply chain"
Reuters
July 29, 2022
HONG KONG, July 29 (Reuters) - China's commerce ministry said on Friday that a major new chips act passed by the U.S. Congress will distort the global semiconductor supply chain and disrupt international trade.
The U.S. House of Representatives passed the sweeping legislation on Thursday to subsidise the domestic semiconductor industry as it competes with Chinese and other foreign manufacturers.
China will continue to monitor the progress and implementation of the U.S. act and take meaures to safeguard its legitimate rights when necessary, the ministry said in a statement.
Reporting by Meg Shen and Twinnie Siu; editing by Jason Neely
https://www.reuters.com/technology/chin ... 022-07-29/
Re: CHINA
REUTERS
"U.S. considers crackdown on memory chip makers in China"
By Alexandra Alper and Karen Freifeld
August 1, 2022
WASHINGTON, Aug 1 (Reuters) - The United States is considering limiting shipments of American chipmaking equipment to memory chip makers in China including Yangtze Memory Technologies Co Ltd , according to four people familiar with the matter, part of a bid to halt China's semiconductor sector advances and protect U.S. companies.
If President Joe Biden's administration proceeds with the move, it could also hurt South Korean memory chip juggernauts Samsung Electronics Co Ltd and SK Hynix Inc, the sources said, speaking on condition of anonymity.
Samsung has two big factories in China while SK Hynix Inc is buying Intel Corp's NAND flash memory chips manufacturing business in China.
The crackdown, if approved, would involve barring the shipment of U.S. chipmaking equipment to factories in China that manufacture advanced NAND chips.
It would mark the first U.S. bid through export controls to target Chinese production of memory chips without specialized military applications, representing a more expansive view of American national security, according to export control experts.
The move also would seek to protect the only U.S. memory chip producers, Western Digital Corp and Micron Technology Inc, which together represent about a quarter of the NAND chips market.
NAND chips store data in devices such as smartphones and personal computers and at data centers for the likes of Amazon, Facebook and Google.
How many gigabytes of data a phone or laptop can hold is determined by how many NAND chips it includes and how advanced they are.
Under the action being considered, U.S. officials would ban the export of tools to China used to make NAND chips with more than 128 layers, according to two of the sources.
LAM Research Corp and Applied Materials, both based in Silicon Valley, are the primary suppliers of such tools.
All the sources described the administration's consideration of the matter as in the early stages, with no proposed regulations yet drafted.
Asked to comment on the possible move, a spokesperson for the Commerce Department, which oversees export controls, did not discuss potential restrictions but noted that "the Biden administration is focused on impairing (China's) efforts to manufacture advanced semiconductors to address significant national security risks to the United States."
FAST-GROWING COMPANY
YMTC, founded in 2016, is a rising power in manufacturing NAND chips.
Micron and Western Digital are under pressure from YMTC's low prices, as the White House wrote in a June 2021 report.
YMTC's expansion and low-price offerings present "a direct threat" to Micron and Western Digital, that report said.
The report described YMTC as China's "national champion" and the recipient of some $24 billion in Chinese subsidies.
YMTC, already under investigation by the Commerce Department over whether it violated U.S. export controls by selling chips to Chinese telecoms company Huawei, is in talks with Apple Inc to supply the top U.S. smartphone maker with flash memory chips, according to a Bloomberg report.
LAM Research Corp, SK Hynix and Micron declined comment on the U.S. policy.
Samsung, Applied Materials Inc, YMTC and Western Digital Corp did not immediately respond to requests for comment.
CONGRESS ACTS
Tensions between China and the United States over the tech sector deepened under Biden's predecessor Donald Trump and have continued since.
Reuters reported on July 8 that Biden's administration is also considering restrictions on shipments to China of tools to make advanced logic chips, seeking to hamstring China's largest chipmaker, SMIC.
The U.S. Congress last week approved legislation aimed at helping the United States compete with China by investing billions of dollars in domestic chip production.
Chipmakers that take money under the measure would be prohibited from building or expanding manufacturing for certain advanced chips, including advanced memory chips at a level to be determined by the administration, in countries including China.
According to Walt Coon of the consulting firm Yole Intelligence, YMTC accounts for about 5% of worldwide NAND flash memory chip production, almost double from a year ago.
Western Digital stands at about 13% and Micron 11%.
Coon said YMTC would be greatly hurt by restrictions like those that Biden's administration is contemplating.
"If they were stuck at 128, I don't know how they would really have a path forward," Coon said.
Production of NAND chips in China has grown to more than 23% of the worldwide total this year from under 14% in 2019, while production in the United States has decreased from 2.3% to 1.6% over the same period, Yole data showed.
For the American companies, nearly all of their chip production is done overseas.
It was unclear what impact the potential restrictions might have on other players in China.
Intel, which retains a contract to manage operations in the factory it is selling to SK Hynix in China, is already producing memory chips with 144 layers at the Chinese site, according to an Intel press release.
Reporting by Alexandra Alper and Karen Freifeld; Additional reporting by Stephen Nellis; Editing by Chris Sanders and Will Dunham
https://www.reuters.com/technology/us-c ... 022-08-01/
"U.S. considers crackdown on memory chip makers in China"
By Alexandra Alper and Karen Freifeld
August 1, 2022
WASHINGTON, Aug 1 (Reuters) - The United States is considering limiting shipments of American chipmaking equipment to memory chip makers in China including Yangtze Memory Technologies Co Ltd , according to four people familiar with the matter, part of a bid to halt China's semiconductor sector advances and protect U.S. companies.
If President Joe Biden's administration proceeds with the move, it could also hurt South Korean memory chip juggernauts Samsung Electronics Co Ltd and SK Hynix Inc, the sources said, speaking on condition of anonymity.
Samsung has two big factories in China while SK Hynix Inc is buying Intel Corp's NAND flash memory chips manufacturing business in China.
The crackdown, if approved, would involve barring the shipment of U.S. chipmaking equipment to factories in China that manufacture advanced NAND chips.
It would mark the first U.S. bid through export controls to target Chinese production of memory chips without specialized military applications, representing a more expansive view of American national security, according to export control experts.
The move also would seek to protect the only U.S. memory chip producers, Western Digital Corp and Micron Technology Inc, which together represent about a quarter of the NAND chips market.
NAND chips store data in devices such as smartphones and personal computers and at data centers for the likes of Amazon, Facebook and Google.
How many gigabytes of data a phone or laptop can hold is determined by how many NAND chips it includes and how advanced they are.
Under the action being considered, U.S. officials would ban the export of tools to China used to make NAND chips with more than 128 layers, according to two of the sources.
LAM Research Corp and Applied Materials, both based in Silicon Valley, are the primary suppliers of such tools.
All the sources described the administration's consideration of the matter as in the early stages, with no proposed regulations yet drafted.
Asked to comment on the possible move, a spokesperson for the Commerce Department, which oversees export controls, did not discuss potential restrictions but noted that "the Biden administration is focused on impairing (China's) efforts to manufacture advanced semiconductors to address significant national security risks to the United States."
FAST-GROWING COMPANY
YMTC, founded in 2016, is a rising power in manufacturing NAND chips.
Micron and Western Digital are under pressure from YMTC's low prices, as the White House wrote in a June 2021 report.
YMTC's expansion and low-price offerings present "a direct threat" to Micron and Western Digital, that report said.
The report described YMTC as China's "national champion" and the recipient of some $24 billion in Chinese subsidies.
YMTC, already under investigation by the Commerce Department over whether it violated U.S. export controls by selling chips to Chinese telecoms company Huawei, is in talks with Apple Inc to supply the top U.S. smartphone maker with flash memory chips, according to a Bloomberg report.
LAM Research Corp, SK Hynix and Micron declined comment on the U.S. policy.
Samsung, Applied Materials Inc, YMTC and Western Digital Corp did not immediately respond to requests for comment.
CONGRESS ACTS
Tensions between China and the United States over the tech sector deepened under Biden's predecessor Donald Trump and have continued since.
Reuters reported on July 8 that Biden's administration is also considering restrictions on shipments to China of tools to make advanced logic chips, seeking to hamstring China's largest chipmaker, SMIC.
The U.S. Congress last week approved legislation aimed at helping the United States compete with China by investing billions of dollars in domestic chip production.
Chipmakers that take money under the measure would be prohibited from building or expanding manufacturing for certain advanced chips, including advanced memory chips at a level to be determined by the administration, in countries including China.
According to Walt Coon of the consulting firm Yole Intelligence, YMTC accounts for about 5% of worldwide NAND flash memory chip production, almost double from a year ago.
Western Digital stands at about 13% and Micron 11%.
Coon said YMTC would be greatly hurt by restrictions like those that Biden's administration is contemplating.
"If they were stuck at 128, I don't know how they would really have a path forward," Coon said.
Production of NAND chips in China has grown to more than 23% of the worldwide total this year from under 14% in 2019, while production in the United States has decreased from 2.3% to 1.6% over the same period, Yole data showed.
For the American companies, nearly all of their chip production is done overseas.
It was unclear what impact the potential restrictions might have on other players in China.
Intel, which retains a contract to manage operations in the factory it is selling to SK Hynix in China, is already producing memory chips with 144 layers at the Chinese site, according to an Intel press release.
Reporting by Alexandra Alper and Karen Freifeld; Additional reporting by Stephen Nellis; Editing by Chris Sanders and Will Dunham
https://www.reuters.com/technology/us-c ... 022-08-01/
Re: CHINA
REUTERSWhich country produces the most gallium?
China produces more than 95% of the world's raw gallium, a soft, bluish metal used in making chipsets for generating high frequency radio waves in 5G base stations.
Gallium is also one of 35 elements that the U.S. government calls a national security concern.
"U.S. tightens export controls on advanced chip, gas turbine engine tech"
By David Shepardson
August 12, 2022
WASHINGTON, Aug 12 (Reuters) - The United States on Friday adopted new export controls on technologies that support the production of advanced semiconductors and gas turbine engines that it said are critical to its national security.
The "emerging and foundational technologies" covered by the move include gallium oxide and diamond, because "devices that utilize these materials have significantly increased military potential," the Commerce Department said.
"Technological advancements that allow technologies like semiconductors and engines to operate faster, more efficiently, longer, and in more severe conditions can be game changers in both the commercial and military context," said Commerce Under Secretary for Industry and Security Alan Estevez.
"When we recognize the risks as well as the benefits, and act in concert with our international partners, we can ensure that our shared security objectives are met."
The four technologies are among items that 42 participating countries reached consensus to control at December 2021 meetings.
The United States export controls cover a wider range of technologies, including additional equipment, software, and technology used to produce semiconductors than the international agreement.
Gallium oxide and diamond allow semiconductors "to work under more severe conditions, such as at higher voltages or higher temperatures."
"Devices that utilize these materials have significantly increased military potential," Commerce said.
The controls include ECAD, a category of software tools used for validating integrated circuits or printed circuit boards "that can advance many commercial as well as military applications including defense and communications satellites," the department said.
In June 2021, the U.S.-China Economic and Security Review Commission found the department was not doing enough to keep sensitive technology out of the hands of China’s military.
The lag in developing the list of emerging and foundational technologies, as required by a 2018 law, may exacerbate national security risks, the report said.
Reporting by David Shepardson and Chris Gallagher; editing by Paul Grant and David Gregorio
https://www.reuters.com/markets/us/us-h ... 022-08-12/
Re: CHINA
REUTERS
"China cuts U.S. Treasuries holdings for 7th straight month - data"
By Reuters Staff
AUGUST 15, 2022
NEW YORK (Reuters) - China reduced holdings of U.S. Treasuries for a seventh consecutive month in June, U.S. Treasury department data released on Monday showed.
China’s stash of U.S. government debt dropped to $967.8 billion in June, the lowest since May 2010 when it held $843.7 billion.
In May, the world’s second largest economy had $980.8 billion in Treasuries, data showed.
Japan increased holdings of Treasuries to $1.236 trillion in June, from a revised $1.224 trillion in May.
The Treasury report released in July showed Japan had $1.213 trillion in Treasuries.
Reporting by Gertrude Chavez-Dreyfuss; Editing by Richard Chang
https://www.reuters.com/article/usa-tre ... SL1N2ZR1MV
"China cuts U.S. Treasuries holdings for 7th straight month - data"
By Reuters Staff
AUGUST 15, 2022
NEW YORK (Reuters) - China reduced holdings of U.S. Treasuries for a seventh consecutive month in June, U.S. Treasury department data released on Monday showed.
China’s stash of U.S. government debt dropped to $967.8 billion in June, the lowest since May 2010 when it held $843.7 billion.
In May, the world’s second largest economy had $980.8 billion in Treasuries, data showed.
Japan increased holdings of Treasuries to $1.236 trillion in June, from a revised $1.224 trillion in May.
The Treasury report released in July showed Japan had $1.213 trillion in Treasuries.
Reporting by Gertrude Chavez-Dreyfuss; Editing by Richard Chang
https://www.reuters.com/article/usa-tre ... SL1N2ZR1MV
Re: CHINA
South China Morning Post
"Tech war: China's memory chip champion YMTC stays mum amid threat of US sanctions"
August 5, 2022
China's top memory chip maker Yangtze Memory Technologies Corp (YMTC) has yet to publicly comment on the possibility it might come under US sanctions, as Chinese technology firms keep a low profile amid geopolitical risks.
The Wuhan-based company has been mum on reports this week that Washington plans to ban the shipment of US equipment used for making advanced NAND chips to China.
In a letter to US Commerce Secretary Gina Raimondo dated July 28, Senate majority leader Chuck Schumer and a half-dozen other senators from both parties described the "growing threat" posed by Chinese semiconductor manufacturers like YMTC to national security and US chip companies.
It is not the first time that YMTC, which is currently not on any US trade blacklist, has faced sanction threats from US politicians.
However, the silence of YMTC, which denied ties to the Chinese military last year, comes as the US ups its efforts on multiple fronts to contain China's growing semiconductor industry over national security concerns.
The Chips and Science Act, which was passed by the US House of Representatives and Senate last week, promises US$52 billion in subsidies to semiconductor manufacturers building fabrication plants, or fabs, on American soil.
The US is also trying to build a chip alliance with South Korea, Japan and Taiwan to exclude China from global semiconductor supply chains, while pressuring Dutch chip equipment giant ASML to stop selling more lithography systems to wafer fabs in China.
The rising hostility coincides with technological breakthroughs attained by major chip makers in China, which have refrained from revealing too much about their achievements.
Semiconductor Manufacturing International Corp has neither confirmed nor denied a recent analyst report that said the company has developed the capability to produce 7-nanometre chips.
And while YMTC showcased a new and advanced NAND flash chip - described by the company as "a key industry milestone" and "the highest bit density flash product in YMTC's history" - during the Flash Memory Summit in California this week, the company's press release did not specify the exact number of memory cell layers in the chip.
YMTC and its parent company Tsinghua Unigroup did not reply to a request for comment.
According to Chinese state media, including the Global Times, YMTC's new chip is made up of 232 layers of memory cells.
The Chinese chip maker is essentially on a par with global peers, according to Stewart Randall, head of electronics and embedded software at consultancy firm Intralink.
US memory chip maker Micron Technology said last week it had begun production of the world's first 232-layer NAND chip and would start mass production later this year.
This week, South Korean chip giant SK Hynix said it has developed the "industry's highest" NAND flash chip with 238 layers of memory cells.
The US government is targeting YMTC with potential restrictions because officials are worried that the Chinese company could undercut the market, pushing down prices and profits in a bid to gain market share, Randall said.
YMTC controlled 5 per cent of the global market for NAND flash memory chips in 2021, and its share had been expected to surpass 10 per cent by 2027, according to industry research firm Yole Development.
To expand output and advance the production level amid competition with international rivals, YMTC has been ramping up construction of its second plant and already started equipment installation in June, according to Nikkei Asia.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century.
https://www.yahoo.com/now/tech-war-chin ... 00273.html
"Tech war: China's memory chip champion YMTC stays mum amid threat of US sanctions"
August 5, 2022
China's top memory chip maker Yangtze Memory Technologies Corp (YMTC) has yet to publicly comment on the possibility it might come under US sanctions, as Chinese technology firms keep a low profile amid geopolitical risks.
The Wuhan-based company has been mum on reports this week that Washington plans to ban the shipment of US equipment used for making advanced NAND chips to China.
In a letter to US Commerce Secretary Gina Raimondo dated July 28, Senate majority leader Chuck Schumer and a half-dozen other senators from both parties described the "growing threat" posed by Chinese semiconductor manufacturers like YMTC to national security and US chip companies.
It is not the first time that YMTC, which is currently not on any US trade blacklist, has faced sanction threats from US politicians.
However, the silence of YMTC, which denied ties to the Chinese military last year, comes as the US ups its efforts on multiple fronts to contain China's growing semiconductor industry over national security concerns.
The Chips and Science Act, which was passed by the US House of Representatives and Senate last week, promises US$52 billion in subsidies to semiconductor manufacturers building fabrication plants, or fabs, on American soil.
The US is also trying to build a chip alliance with South Korea, Japan and Taiwan to exclude China from global semiconductor supply chains, while pressuring Dutch chip equipment giant ASML to stop selling more lithography systems to wafer fabs in China.
The rising hostility coincides with technological breakthroughs attained by major chip makers in China, which have refrained from revealing too much about their achievements.
Semiconductor Manufacturing International Corp has neither confirmed nor denied a recent analyst report that said the company has developed the capability to produce 7-nanometre chips.
And while YMTC showcased a new and advanced NAND flash chip - described by the company as "a key industry milestone" and "the highest bit density flash product in YMTC's history" - during the Flash Memory Summit in California this week, the company's press release did not specify the exact number of memory cell layers in the chip.
YMTC and its parent company Tsinghua Unigroup did not reply to a request for comment.
According to Chinese state media, including the Global Times, YMTC's new chip is made up of 232 layers of memory cells.
The Chinese chip maker is essentially on a par with global peers, according to Stewart Randall, head of electronics and embedded software at consultancy firm Intralink.
US memory chip maker Micron Technology said last week it had begun production of the world's first 232-layer NAND chip and would start mass production later this year.
This week, South Korean chip giant SK Hynix said it has developed the "industry's highest" NAND flash chip with 238 layers of memory cells.
The US government is targeting YMTC with potential restrictions because officials are worried that the Chinese company could undercut the market, pushing down prices and profits in a bid to gain market share, Randall said.
YMTC controlled 5 per cent of the global market for NAND flash memory chips in 2021, and its share had been expected to surpass 10 per cent by 2027, according to industry research firm Yole Development.
To expand output and advance the production level amid competition with international rivals, YMTC has been ramping up construction of its second plant and already started equipment installation in June, according to Nikkei Asia.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century.
https://www.yahoo.com/now/tech-war-chin ... 00273.html
Re: CHINA
REUTERS
"Republican Rubio slams U.S. approval of chip deal with China ties"
By Reuters Staff
AUGUST 29, 2022
WASHINGTON (Reuters) - Republican Senator Marco Rubio on Monday blasted U.S. regulatory approval of a bid by chip intellectual property company Alphawave to purchase U.S.-based OpenFive, over alleged national security risks posed by the buyer’s ties to China’s Wise Road Capital.
On Friday, the Toronto and London-based Alphawave, which licenses its technology to chipmakers, said it had received all regulatory clearances, including from the powerful U.S. Committee on Foreign Investment in the United States (CFIUS).
The $210 million deal is expected to close next month.
The deal has drawn fire from Republican China hawks in Congress, including the influential Rubio, who has advocated for CFIUS to review deals related to China that he saw as posing national security risks.
Earlier this year, he called on CFIUS to scrutinize the Alphawave deal, citing Chinese private equity firm Wise Road Capital’s 10% stake in Alphawave and their 2021 agreement allowing Wise Road Capital to license Alphawave technology to increase its customer base in China.
Rubio on Monday accused President Joe Biden’s administration of “yet again” demonstrating its “total unwillingness” to take seriously the threat of China aggressively buying and stealing U.S. intellectual property.
“American competitiveness will suffer in the long term as a result,” he warned.
The Treasury department, which heads CFIUS, OpenFive and Wise Road Capital did not respond to requests for comment.
Alphawave declined to comment.
Liu Pengyu, a spokesman for the Chinese Embassy in Washington, said China opposes attempts to politicize or interfere politically in mergers and acquisitions.
“Some U.S. politicians are ... accusing China of 'stealing' intellectual property rights but are short on delivering solid evidence,” Liu added.
CFIUS has taken a hard line with Wise Road Capital in the past.
In December 2021, the private equity firm and U.S. chipmaker Magnachip Semiconductor Corp said they had terminated their $1.4 billion merger agreement after CFIUS said the deal posed “risks to national security.”
OpenFive also leases chipmaking intellectual property to chipmakers.
Reporting by Alexandra Alper; Editing by Rosalba O’Brien and Richard Chang
https://www.reuters.com/article/usa-chi ... SKBN2PZ1IJ
"Republican Rubio slams U.S. approval of chip deal with China ties"
By Reuters Staff
AUGUST 29, 2022
WASHINGTON (Reuters) - Republican Senator Marco Rubio on Monday blasted U.S. regulatory approval of a bid by chip intellectual property company Alphawave to purchase U.S.-based OpenFive, over alleged national security risks posed by the buyer’s ties to China’s Wise Road Capital.
On Friday, the Toronto and London-based Alphawave, which licenses its technology to chipmakers, said it had received all regulatory clearances, including from the powerful U.S. Committee on Foreign Investment in the United States (CFIUS).
The $210 million deal is expected to close next month.
The deal has drawn fire from Republican China hawks in Congress, including the influential Rubio, who has advocated for CFIUS to review deals related to China that he saw as posing national security risks.
Earlier this year, he called on CFIUS to scrutinize the Alphawave deal, citing Chinese private equity firm Wise Road Capital’s 10% stake in Alphawave and their 2021 agreement allowing Wise Road Capital to license Alphawave technology to increase its customer base in China.
Rubio on Monday accused President Joe Biden’s administration of “yet again” demonstrating its “total unwillingness” to take seriously the threat of China aggressively buying and stealing U.S. intellectual property.
“American competitiveness will suffer in the long term as a result,” he warned.
The Treasury department, which heads CFIUS, OpenFive and Wise Road Capital did not respond to requests for comment.
Alphawave declined to comment.
Liu Pengyu, a spokesman for the Chinese Embassy in Washington, said China opposes attempts to politicize or interfere politically in mergers and acquisitions.
“Some U.S. politicians are ... accusing China of 'stealing' intellectual property rights but are short on delivering solid evidence,” Liu added.
CFIUS has taken a hard line with Wise Road Capital in the past.
In December 2021, the private equity firm and U.S. chipmaker Magnachip Semiconductor Corp said they had terminated their $1.4 billion merger agreement after CFIUS said the deal posed “risks to national security.”
OpenFive also leases chipmaking intellectual property to chipmakers.
Reporting by Alexandra Alper; Editing by Rosalba O’Brien and Richard Chang
https://www.reuters.com/article/usa-chi ... SKBN2PZ1IJ
Re: CHINA
REUTERS
"U.S. officials order Nvidia to halt sales of top AI chips to China"
By Stephen Nellis and Jane Lanhee Lee
August 31, 2022
Aug 31 (Reuters) - Chip designer Nvidia Corp on Wednesday said that U.S. officials told it to stop exporting two top computing chips for artificial intelligence work to China, a move that could cripple Chinese firms' ability to carry out advanced work like image recognition and hamper a business that Nvidia expects to generate $400 million in sales this quarter.
Nvidia shares fell 4% after hours.
The company said the ban, which affects its A100 and H100 chips designed to speed up machine learning tasks, could interfere with completion of developing the H100, the flagship chip Nvidia announced this year.
AMD shares were down 2% in after hours trading.
It makes similar artificial intelligence chips.
Nvidia said U.S. officials told it the new rule "will address the risk that the covered products may be used in, or diverted to, a "military end use" or "military end user" in China."
The announcement signals a major escalation of the U.S. crackdown on China's technological capabilities as tensions bubble over the fate of Taiwan, where chips for Nvidia and almost every other major chip firm are manufactured.
Without American chips from companies like Nvidia and its rival Advanced Micro Devices, Chinese organizations will be unable to cost-effectively carry out the kind of advanced computing used for image and speech recognition, among many other tasks.
Image recognition and natural language processing are common in consumer applications like smartphones that can answer queries and tag photos.
They also have military uses such as scouring satellite imagery for weapons or bases and filtering digital communications for intelligence gathering purposes.
AMD did not immediately respond to request for comment.
Nvidia said it had booked $400 million in sales of the affected chips this quarter to China that could be lost if Chinese firms decide not to buy alternative Nvidia products.
It said it plans to apply for exemptions to the rule but has "no assurances" that U.S. officials will grant them.
Stacy Rasgon, a financial analyst with Bernstein, said the disclosure signaled that about 10% of Nvidia's data center sales, which investors have closely monitored in recent years, were coming from China and that the hit to sales was likely "manageable" for Nvidia.
“It’s not (investment) thesis changing, but it’s not a good look,” Rasgon said.
“What happens on both sides now is the question,” he said about possible escalations going forward.
Reporting by Eva Mathews in Bengaluru; Editing by Devika Syamnath and David Gregorio
https://www.reuters.com/technology/nvid ... 022-08-31/
"U.S. officials order Nvidia to halt sales of top AI chips to China"
By Stephen Nellis and Jane Lanhee Lee
August 31, 2022
Aug 31 (Reuters) - Chip designer Nvidia Corp on Wednesday said that U.S. officials told it to stop exporting two top computing chips for artificial intelligence work to China, a move that could cripple Chinese firms' ability to carry out advanced work like image recognition and hamper a business that Nvidia expects to generate $400 million in sales this quarter.
Nvidia shares fell 4% after hours.
The company said the ban, which affects its A100 and H100 chips designed to speed up machine learning tasks, could interfere with completion of developing the H100, the flagship chip Nvidia announced this year.
AMD shares were down 2% in after hours trading.
It makes similar artificial intelligence chips.
Nvidia said U.S. officials told it the new rule "will address the risk that the covered products may be used in, or diverted to, a "military end use" or "military end user" in China."
The announcement signals a major escalation of the U.S. crackdown on China's technological capabilities as tensions bubble over the fate of Taiwan, where chips for Nvidia and almost every other major chip firm are manufactured.
Without American chips from companies like Nvidia and its rival Advanced Micro Devices, Chinese organizations will be unable to cost-effectively carry out the kind of advanced computing used for image and speech recognition, among many other tasks.
Image recognition and natural language processing are common in consumer applications like smartphones that can answer queries and tag photos.
They also have military uses such as scouring satellite imagery for weapons or bases and filtering digital communications for intelligence gathering purposes.
AMD did not immediately respond to request for comment.
Nvidia said it had booked $400 million in sales of the affected chips this quarter to China that could be lost if Chinese firms decide not to buy alternative Nvidia products.
It said it plans to apply for exemptions to the rule but has "no assurances" that U.S. officials will grant them.
Stacy Rasgon, a financial analyst with Bernstein, said the disclosure signaled that about 10% of Nvidia's data center sales, which investors have closely monitored in recent years, were coming from China and that the hit to sales was likely "manageable" for Nvidia.
“It’s not (investment) thesis changing, but it’s not a good look,” Rasgon said.
“What happens on both sides now is the question,” he said about possible escalations going forward.
Reporting by Eva Mathews in Bengaluru; Editing by Devika Syamnath and David Gregorio
https://www.reuters.com/technology/nvid ... 022-08-31/
Re: CHINA
REUTERS
"With new China AI chip restrictions, U.S. takes aim at a critical niche"
By Stephen Nellis and Alexandra Alper
September 1, 2022
Sept 1 (Reuters) - The United States beefed up its effort to cut off the flow of advanced technology to China by instructing Nvidia Corp and Advanced Micro Devices to stop sending their flagship artificial intelligence chips there.
While the news shocked the chip sector by the time markets closed Thursday, sending the Philadelphia semiconductor index down 1.9% and Nvidia and AMD down 7.6% and 3% respectively, the letters from the U.S. officials appeared to target a narrow but critical part of China's computing industry.
The regulations appear to focus on chips called GPUs with the most powerful computing capabilities, a critical but niche market with only two meaningful players, Nvidia and AMD.
Their only potential rival - Intel Corp - is trying to break into the market but has not released competitive products.
Originally designed for video games, the usage of GPUs, or graphic processing units, have been expanded to a wider array of applications that include handling artificial intelligence work like image recognition, categorizing cat photos or scouring digital satellite imagery for military equipment.
Because all the chip suppliers are American, the U.S. controls access to the technology.
Some national security experts saw the U.S. move as a long time coming.
GPUs "have been totally uncontrolled to China and to Russia, so in a lot of ways I see this action as kind of catching up to where the controls probably should have been if we were really serious about trying to slow China’s AI growth," said Emily Kilcrease, a senior fellow at the Center for a New American Security.
The U.S. Department of Commerce, which declined to comment on the specifics of whatever new rules it may be developing, appears to have targeted the effort narrowly.
The only products Nvidia said would be affected are its A100 and H100 chips.
Those chips cost tens of thousands of dollars each, with full computers containing the chips costing hundreds of thousands of dollars.
Similarly, AMD said that only its most powerful MI250 chip - a version of which is being used at Oak Ridge National Laboratory, one of several U.S. supercomputing sites that supports nuclear weapons - is affected by the new requirement.
Less powerful chips such as AMD's MI210 and below are not affected.
What the affected chips share is the ability to carry out calculations for artificial intelligence work quickly, at huge scale and with high precision.
Less powerful AI chips can work quickly at lower levels of precision, which is sufficient for tagging photos of friends and where the cost of an occasional mistake is low - but are insufficient for designing fighter jets.
The only major market rival to AMD and Nvidia's chips is Intel's still-unreleased Ponte Vecchio chip, whose first customer is Argonne National Lab, another U.S. installation that supports nuclear weapons.
"While we understand the U.S. Government is continuing to look at new restrictions, no new export control rules have been published and there are currently no changes to our business," Intel told Reuters in a statement.
"We are closely monitoring the process."
Reporting by Stephen Nellis and Jane Lee in San Francisco and Alexandra Alper in Washington; editing by Jonathan Oatis
https://www.reuters.com/markets/us/with ... 022-09-01/
"With new China AI chip restrictions, U.S. takes aim at a critical niche"
By Stephen Nellis and Alexandra Alper
September 1, 2022
Sept 1 (Reuters) - The United States beefed up its effort to cut off the flow of advanced technology to China by instructing Nvidia Corp and Advanced Micro Devices to stop sending their flagship artificial intelligence chips there.
While the news shocked the chip sector by the time markets closed Thursday, sending the Philadelphia semiconductor index down 1.9% and Nvidia and AMD down 7.6% and 3% respectively, the letters from the U.S. officials appeared to target a narrow but critical part of China's computing industry.
The regulations appear to focus on chips called GPUs with the most powerful computing capabilities, a critical but niche market with only two meaningful players, Nvidia and AMD.
Their only potential rival - Intel Corp - is trying to break into the market but has not released competitive products.
Originally designed for video games, the usage of GPUs, or graphic processing units, have been expanded to a wider array of applications that include handling artificial intelligence work like image recognition, categorizing cat photos or scouring digital satellite imagery for military equipment.
Because all the chip suppliers are American, the U.S. controls access to the technology.
Some national security experts saw the U.S. move as a long time coming.
GPUs "have been totally uncontrolled to China and to Russia, so in a lot of ways I see this action as kind of catching up to where the controls probably should have been if we were really serious about trying to slow China’s AI growth," said Emily Kilcrease, a senior fellow at the Center for a New American Security.
The U.S. Department of Commerce, which declined to comment on the specifics of whatever new rules it may be developing, appears to have targeted the effort narrowly.
The only products Nvidia said would be affected are its A100 and H100 chips.
Those chips cost tens of thousands of dollars each, with full computers containing the chips costing hundreds of thousands of dollars.
Similarly, AMD said that only its most powerful MI250 chip - a version of which is being used at Oak Ridge National Laboratory, one of several U.S. supercomputing sites that supports nuclear weapons - is affected by the new requirement.
Less powerful chips such as AMD's MI210 and below are not affected.
What the affected chips share is the ability to carry out calculations for artificial intelligence work quickly, at huge scale and with high precision.
Less powerful AI chips can work quickly at lower levels of precision, which is sufficient for tagging photos of friends and where the cost of an occasional mistake is low - but are insufficient for designing fighter jets.
The only major market rival to AMD and Nvidia's chips is Intel's still-unreleased Ponte Vecchio chip, whose first customer is Argonne National Lab, another U.S. installation that supports nuclear weapons.
"While we understand the U.S. Government is continuing to look at new restrictions, no new export control rules have been published and there are currently no changes to our business," Intel told Reuters in a statement.
"We are closely monitoring the process."
Reporting by Stephen Nellis and Jane Lee in San Francisco and Alexandra Alper in Washington; editing by Jonathan Oatis
https://www.reuters.com/markets/us/with ... 022-09-01/