Chip industry voices concerns over Joe Biden’s new export regulations, say input not sought

Around six trade groups from the semiconductor (chips) and manufacturing industries in the United States have sent a private letter to US President Joe Biden about the new export rules set to be implemented this week, Reuters reported. They have complained that the regulation were formed without consulting with them and would disadvantage US chip makers against competitors in terms of market share, it added.

Trade Unions Send Biden Letter Opposing Rules

This comes after the Biden administration on January 13 released new regulations for computing chips from Nvidia and its export, as per the report. The government has set up a three-tier system in which most nations will need to obtain licenses to build AI data centers with US chips.

In a private letter, sent the same day, trade groups such as chip companies representative the Semiconductor Industry Association (SIA), and chip's tool manufacturers representative SEMI, wrote to Biden complaining about the rules set that may be imposed this week.

“We understand that this additional rule will even more strictly control high bandwidth memory, without consideration of how such changes may impact U.S. companies or cede market share to global competitors,” the letter said.

It added, “Again, these pending regulations have been developed without appropriate industry consultation or the opportunity for public comment, despite their long-term impacts and economic and international significance.”

Both SIA and SEMI did not respond to queries, the report added.

Restrictions will Affect Global Market Share, Say Industry Reps

The report further noted that at present, US and South Korean companies produce high-bandwidth memory chips, which are “critical” for advanced AI chips, and the rule would restrict its sale to China.

A source told Reuters that the expected rules could also reverse an earlier interpretation of the rules that allowed companies such as Lam Research, which supplies equipment to memory chip makers in China, to bring in hundreds of millions more dollars in revenue than it had previously anticipated. Lam did not immediately respond to a request for comment, it added.

(With inputs from Reuters)