US revokes TSMC's licence on China-bound tech

The United States has decided to stop Taiwan Semiconductor Manufacturing Company, known as TSMC, from sending advanced technology from America to China. TSMC is the world's largest maker of computer chips, which are essential for devices like smartphones, computers, and many other electronics. The US government told TSMC that its special permission to export advanced technology to China will end by the end of this year. This move could make it more difficult for TSMC to operate its factory in China, which mainly produces older types of chips. Just last week, the US made a similar decision for two major South Korean companies, Samsung and SK Hynix, making it harder for them to send American products to their Chinese factories. TSMC said it is still figuring out what to do and will talk with the US government about the situation. The company also promised to keep its Chinese factory running as smoothly as possible. The US Commerce Department has not given a detailed explanation yet, but this action is part of a larger effort to protect the US economy and keep advanced technology out of China's hands.

The US has been putting restrictions on exporting advanced technology to China for some time. At first, some global tech companies were allowed to send certain products to China, but now those permissions are being taken away. This means companies like TSMC will have to apply for approval every time they want to ship advanced technology to China, which could slow down shipments and make the process more expensive. According to investment expert Raymond Woo, suppliers from the US will need to get individual approvals, which adds more steps and costs. Chinese customers might have to use local alternatives, but these are often less advanced than what they could get from companies like TSMC. However, this situation could push Chinese companies to innovate and make better use of the equipment they already have, especially in areas where having the latest technology is not absolutely necessary.

Raymond Woo, who works at Kyoto University Innovation Capital, said that the impact on TSMC will probably be limited. TSMC's only factory in China, located in Nanjing, makes older chips that do not contribute much to the company's overall revenue. TSMC is still a major player in the global chip industry and supplies chips to big clients like Nvidia. The new US rules could make it harder for TSMC and other companies to do business in China, but for now, TSMC's main business is not seriously affected. The situation is still developing, and many people are watching to see how these changes will influence the technology industry and the relationship between the US, China, and major tech companies in the future.