Reuters: U.S. Orders Equipment Makers to Halt Shipments to Chinese Firm Hua Hong Semiconductor
The U.S. Department of Commerce has ordered American chip equipment companies to suspend some equipment shipments to China's Hua Hong Semiconductor. This is the latest action by the U.S. to curb China's advanced chip development, potentially escalating technology competition and tensions between the two countries.
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- 📰 Published: April 29, 2026 at 06:46
- 🔍 Collected: April 29, 2026 at 07:01 (15 min after Published)
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Central News Agency
(Central News Agency, New York, 28th, Comprehensive Foreign Report) Reuters reported, citing two informed sources, that the U.S. Department of Commerce recently ordered several chip equipment companies to suspend some equipment shipments to China's second-largest chip manufacturer, Hua Hong Semiconductor, in the latest move by the U.S. to slow China's advanced chip development.
Sources revealed that the U.S. Department of Commerce sent letters to at least several companies last week, imposing new restrictions on equipment and other raw materials shipped to Hua Hong's facilities, which U.S. officials believe could produce the most advanced Chinese chips.
Sources added that leading U.S. chip equipment suppliers Lam Research, Applied Materials, and KLA are believed to have all received letters from the Commerce Department, as they have significant business in supplying Chinese customers.
Reuters disclosed in March that Shanghai Hua Hong Group has developed advanced process technology capable of producing artificial intelligence (AI) chips, a major milestone in Beijing's push for technological self-sufficiency. Hua Hong's foundry, Shanghai Huali Microelectronics, is preparing to produce 7nm process chips.
China's largest foundry, SMIC, is currently the only Chinese company capable of producing 7nm chips. SMIC has not yet responded to requests for comment.
Sources also said that the notification letters sent by the U.S. Department of Commerce also intend to prevent equipment from flowing to Huali Microelectronics. After Reuters disclosed this news, KLA, Lam Research, and Applied Materials' U.S. stock prices fell by 4% to 6% at market close, and Hua Hong Semiconductor closed down 3.5% today.
In recent years, to maintain its technological leadership in AI and other advanced chips, the Commerce Department has continued to restrict U.S. companies from supplying equipment to Chinese advanced chip factories for national security reasons. This notification letter continues the existing policy but may escalate U.S.-China tensions before U.S. President Donald Trump is scheduled to visit China in May to meet with Chinese President Xi Jinping.
One of the sources said that the Commerce Department's move could cost chip equipment manufacturers and other suppliers billions of dollars in sales, especially those supplying factories under construction or those upgrading equipment to produce more advanced process facilities.
A spokesperson for the U.S. Department of Commerce declined to comment; Lam Research, Applied Materials, KLA, and Hua Hong Semiconductor have not yet responded to Reuters' requests for comment.
This type of notification from the Commerce Department is called an "is-informed letter," which allows the U.S. government to bypass lengthy legislative procedures and quickly implement new licensing regulations for specific companies. Such letters were frequently used during the Trump administration, but the restrictions contained in them do not necessarily become law in the end. (Compiler: Hong Qiyuan) 1150429
(Central News Agency, New York, 28th, Comprehensive Foreign Report) Reuters reported, citing two informed sources, that the U.S. Department of Commerce recently ordered several chip equipment companies to suspend some equipment shipments to China's second-largest chip manufacturer, Hua Hong Semiconductor, in the latest move by the U.S. to slow China's advanced chip development.
Sources revealed that the U.S. Department of Commerce sent letters to at least several companies last week, imposing new restrictions on equipment and other raw materials shipped to Hua Hong's facilities, which U.S. officials believe could produce the most advanced Chinese chips.
Sources added that leading U.S. chip equipment suppliers Lam Research, Applied Materials, and KLA are believed to have all received letters from the Commerce Department, as they have significant business in supplying Chinese customers.
Reuters disclosed in March that Shanghai Hua Hong Group has developed advanced process technology capable of producing artificial intelligence (AI) chips, a major milestone in Beijing's push for technological self-sufficiency. Hua Hong's foundry, Shanghai Huali Microelectronics, is preparing to produce 7nm process chips.
China's largest foundry, SMIC, is currently the only Chinese company capable of producing 7nm chips. SMIC has not yet responded to requests for comment.
Sources also said that the notification letters sent by the U.S. Department of Commerce also intend to prevent equipment from flowing to Huali Microelectronics. After Reuters disclosed this news, KLA, Lam Research, and Applied Materials' U.S. stock prices fell by 4% to 6% at market close, and Hua Hong Semiconductor closed down 3.5% today.
In recent years, to maintain its technological leadership in AI and other advanced chips, the Commerce Department has continued to restrict U.S. companies from supplying equipment to Chinese advanced chip factories for national security reasons. This notification letter continues the existing policy but may escalate U.S.-China tensions before U.S. President Donald Trump is scheduled to visit China in May to meet with Chinese President Xi Jinping.
One of the sources said that the Commerce Department's move could cost chip equipment manufacturers and other suppliers billions of dollars in sales, especially those supplying factories under construction or those upgrading equipment to produce more advanced process facilities.
A spokesperson for the U.S. Department of Commerce declined to comment; Lam Research, Applied Materials, KLA, and Hua Hong Semiconductor have not yet responded to Reuters' requests for comment.
This type of notification from the Commerce Department is called an "is-informed letter," which allows the U.S. government to bypass lengthy legislative procedures and quickly implement new licensing regulations for specific companies. Such letters were frequently used during the Trump administration, but the restrictions contained in them do not necessarily become law in the end. (Compiler: Hong Qiyuan) 1150429