It is reported that the U.S. government is investigating allegations that Chinese flash memory provider Yangtze River Storage provided chips to Huawei, and if true, Yangtze River Storage may be sanctioned for violating the US export ban against Huawei.
The United States accused Yangtze River Storage of supplying chips to Huawei
According to the Financial Times, the U.S. government is investigating allegations that Chinese semiconductor manufacturer Changjiang Storage Technology Co., Ltd. supplied chips to Huawei, saying it may have violated U.S. export controls!
According to the report, the US White House and the US Department of Commerce received a "credible" report from Tech Insights, a professional disassembly analysis agency, showing that Yangtze River Storage provided a NAND Flash flash memory chip for Huawei's Changxiang 20e mobile phone, manufactured in August 2021.
At that time, former US President Trump had imposed an export ban on Huawei for a year, and the US government had also banned any US enterprise or foreign business from exporting any US technology or products containing US technology to Huawei.
According to sources, U.S. Customs is actively investigating allegations of violations of the Export Administration Regulations by Yangtze River Storage, but any enforcement action will have to wait until the investigation is completed.
Michael McCaul, the chief member of the U.S. House of Representatives Foreign Relations Committee, which has consistently targeted China, argued that Yangtze Storage appeared to violate the U.S. Direct Products Abroad Rule (FDPR).
In order to determine that Yangtze Storage really violated FDPR, the United States must prove that Yangtze Storage "knew" that its chips would be supplied to Huawei, which could be complicated.
In fact, last year, the United States pointed out that Yangtze River Storage will become China's "largest memory chip manufacturer".
Some Republicans, including Michael McCaul, also want to add Yangtze River Storage to the Commerce Department's "Entity List" and impose strict export control measures.
At the end of March this year, there was news that Yangtze River Storage successfully entered Apple's iPhone supply chain and will supply flash memory for Apple's iPhone SE 3, which also worried some US lawmakers.
As of now, Huawei and Yangtze River Storage have not publicly responded.
Far-reaching FDPR rules
Two years ago, on May 15, 2020, the U.S. Department of Commerce's Bureau of Industry and Security (BIS) announced changes to its long-standing foreign-produced direct product (FMDP) rules and entity list to more strategically target Huawei and curb its access to semiconductor products, technology, and related software. This policy goal is to cut off Huawei's path to circumvent US export controls and maintain US national security. The rule is seeking public comment on its impact until July 14, 2020.
Specifically, this targeted rule modification will subject the following foreign-produced items to the Export Administration Regulations (EAR):
(i) the semiconductors, etc. designed and manufactured by Huawei and its affiliates on the Entity List (such as HiSilicon) are direct products of certain software and technologies on the U.S. Commercial Control List (CCL); and
(ii) Chipsets and other items produced in accordance with the design specifications of Huawei or an affiliated company on the Entity List (such as HiSilicon) are direct products produced overseas in the United States by certain semiconductor manufacturing equipment on CCL. When such foreignly produced items are used for re-export, export from abroad, or transfer (domestically) to Huawei or any of its affiliates on its list, a U.S. license is required.
In order to avoid immediate and serious economic damage to foreign foundries using U.S. semiconductor production equipment, if these foundries have initiated any production steps based on Huawei's design requirements before May 15, these foreign-produced products are re-exported, exported from abroad or transferred (domestically) within 120 days of the effective date of the rules, without applying for a U.S. license. Huawei's Temporary General License, which was announced at the same time on May 15, was extended for another 90 days, but the statement was the last.
In response to the new regulations of the US Department of Commerce on May 15, the top priority for Chinese semiconductor companies is to clarify the scope of products affected, find solutions in the transition period, and carry out compliance transactions with various Huawei entities. At the macro level, the independent and controllable technology research and development of China's technology industry needs to be accelerated, and the demand for domestic chips that do not rely on US technology will increase, and the alternative solution to key technology vacancies is also a top priority.
Clamping from semiconductor chips to software
Western countries led by the United States have a long history of technology export controls on non-Western system countries, which were formed during the Cold War, and after the end of the Cold War, the Wassenaar Agreement was quickly introduced to restrict the so-called "dual-use technology", and now China's high-tech technology imports are still deeply affected by the Wassenaar Agreement
China is an embargoed country, so whether it is dual-use technology or military technology, the states parties to the Wassenaar Agreement must restrict the export of corresponding technology to China. For example, Taiwan's regulations on Chinese mainland technology restrictions also refer to the Wassenaar Agreement, which stipulates that the technology invested by semiconductor companies in the mainland should be different from that of Taiwan, and Taiwan enterprises are not allowed to bring the most advanced technology to the mainland
The Wassenaar Agreement has been quite strict on technology control, but after all, it is a regulation formulated in 1996, so its control measures are more for "physical technology" with specific product forms, and it is difficult to invoke the Wassenaar Agreement for software and Internet technology control measures, which is why the United States has introduced foreign product control regulations FPDR patching to strengthen the control of "soft technology", and the FPDR has particularly emphasized the use of US software technology.
Not only to clamp down on mainland technology enterprises
In April 2022, the U.S. Treasury Department announced sanctions against 21 Russian entities and 13 individuals, including Mikron, Russia's largest chipmaker, microelectronics manufacturer and exporter. It is the latest punitive move against Vladimir Putin's attack on Ukraine.
According to the latest statement, the U.S. Treasury Department will sanction 21 entities and 13 individuals "in case Russia evades sanctions and procures key Western technology." The sanctions list includes Joint Stock Company Mikron, Russia's largest chipmaker and microelectronics maker and exporter.
In addition, the sanctions target Moscow-based Serniya Engineering and equipment manufacturer Sertal, which the U.S. Treasury Department accused of illegally procuring civilian-ready equipment and technology for the Russian defense sector. The U.S. Treasury Department also said that under the existing executive order, three new sectors of the Russian economy will be sanctioned, and the United States can take punitive measures against any Russian individual or entity operating in the aerospace, marine and electronics industries.
All property and property interests in the 21 entities and 13 individuals sanctioned in the U.S. or owned or controlled by U.S. persons are frozen and must be reported to OFAC.
Written at the end: Technology should be self-reliant
Under the hegemony of science and technology, the real pain is not only the current Huawei and its ecological industry chain, behind which Huawei is only a microcosm of the domestic semiconductor industry. Semiconductor technology itself is a very large system, want to catch up and surpass is not an easy task, fortunately, under the guidance of the national strategy of innovation, the domestic science and technology field of independent research and development is rising step by step.
I hope that in the near future, when the world's semiconductor technology field is reshuffled, our country can occupy an important position.
Editor| Zhang Yi
Audit | Wu Xin