Bipartisan lawmakers from the House China Select Committee have sent a letter to US Commerce Secretary Gina Raimondo urging her to crack down on Huawei’s “clandestine chip network.” It is the latest attempt by the US to prevent the telecom giant from further developing semiconductor manufacturing, citing national security as their main concern.
The letter celebrated past efforts to block Huawei’s progress but warned that the company was finding ways to work around these. They urged Raimondo to “continue taking action to address the national security threat of Huawei by addressing its building of clandestine semiconductor facilities used to circumvent US law.”
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PXW Semiconductor, a firm run by an ex-Huawei executive, was put on the Entity List in 2022. US firms are prevented from exchanging goods with companies on the list without a government-issued license. The letter outlines how Huawei has been circumventing these restrictions by using firms such as Pengxinxu, SwaySure Technology, Qingdao SiEn and “potentially many others” which are currently not on the list. They say these companies rely on substantial amounts of US-produced manufacturing equipment (SME).
The lawmakers warn that SwaySure, for example, is PXW’s Semiconductor’s sister firm because it is controlled by the same entity, Shenzhen Major Industrial Investment Group Co which is ultimately owned by the Shenzhen government.
They say SwaySure is also headed by ex-Huawei executives and engages in “supply chain collaboration and research” with Huawei. It argues that the same logic used to add PXW to the entity list applies to its sister companies.
It urges Raimondo to “move quickly to deny Huawei’s ability to use US SME to build its own semiconductor capabilities” for the sake national security.
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By GlobalDataUS efforts to curb China’s technological development have been ongoing. Their attempts to convince allies to do the same have also seen some success. In early September, the Dutch government expanded export restrictions on advanced semiconductor manufacturing equipment affecting the world’s only producer of high-end lithography machines ASML.
Japan has also expanded restrictions, such as limiting sales and servicing of chipmaking equipment. In September, this led to China threatening economic retaliation.
