US introduces export controls on design software and substrate materials to block Chinese companies from using advanced chip manufacturing processes
New US export controls took effect on Monday that industry watchers say form an effective blockade to China’s ambitions to create an independent semiconductor industry.
The measures place export restrictions on four technologies, including computer-aided design software used in developing next-generation chips with gate-all-around (GAA) field-effect transistor structures.
The restrictions also affect two substrates, gallium oxide and diamond, that operate at much higher voltages, frequencies and temperatures than conventional chip materials such as silicon, and are used in manufacturing so-called ultra-wide bandgap semiconductors.
China is not explicitly mentioned in the restrictions, but they clearly target China’s future semiconductor ambitions, analyst Shang Manjun of Shanghai-based semiconductor consultancy ICwise told the South China Morning Post.
She said the restrictions on design software were a “trump card” the US had not used before.
The restrictions follow shortly after US president Joe Biden signed the Chips and Science Act that sets aside nearly $53 billion (£44bn) to boost domestic semiconductor manufacturing.
The Bureau of Industry and Security (BIS) the US Department of Commerce agency that announced the measures, said the export ban on gallium oxide and diamond was intended to prevent the use of the materials in chips for military applications.
Chinese semiconductor makers rely on advanced US electronic design automation (EDA) software made by the likes of Cadence Design Systems, Synopsys and Mentor Graphics, which is more cutting-edge than that made by Chinese software suppliers such as Empyrean Technology.
Chinese firms are not currently manufacturing chips that require design software for GAA structures, but it would be needed once China reaches 3-nanometre manufacturing processes, an unnamed EDA software company executive told the SCMP.
The executive said Chinese companies such as Empyrean are at least one or two generations behind the major US suppliers.
Samsung Electronics said in June it had started initial production of its 3nm process node using GAA transistor architecture, while Taiwan’s TSMC has GAA on its roadmap for processes smaller than 5nm.
Intel is expected to begin GAA production between 2024 and 2025.
Earlier this month reports said the US was considering blocking shipments of certain types of advanced chipmaking equipment to China in a move aimed at hobbling the expansion of memory chip makers operating in the country.
In July the US was reported to be considering targeted restrictions that would bar China’s SMIC from manufacuring advanced chips, while allowing Chinese factories to continue making commodity chips, in order to avoid exacerbating a worldwide semiconductor shortage.