SEMI urges US to review China export controls

SEMI urges US to review China export controls

Business news |
Ajit Manocha, CEO of the SEMI trade organization, has written a letter to the US administration calling for an urgent review of the current unilateral US export control policy.
By Peter Clarke

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The letter, written to incoming Secretary of Commerce Gina Raimondo, argues that unilateral imposition of export controls is a blunt tool and one that is not serving the US or global competition. The letter does advocate the strengthening of US manufacturing, investment in R&D and the pursuit of multilateral rather than unilateral U.S. export controls.

The letter argues that unilateral action only works in the short-term, often has unintended consequences and leave US exporters and their customers open to retaliatory action, such as the recent order from China’s Ministry of Commerce to counteract extraterritorial application of foreign measures.

SEMI was against the imposition of 2018 Export Control Reform Act by the Trump administration (Semiconductor industry pushes back against US export controls) and has wasted little time in calling for its removal.

In the letter Manocha argues for multilateral controls – where items of concern are controlled by all major producing nations – to create a level playing field. He also observes that the unilateral approach results in US-origin technology getting designed-out and promotes the development of foreign competitors.

In addition as US-origin items are designed out, the US government loses visibility of the technology capability and roadmaps of global products, he argues.

The letter is critical of the previous administration’s “ambiguous” unilateral controls on semiconductor-related items and its “unusual” use of Commerce Department’s Export Administration Regulations (EAR), without consulting with industry.

SEMI calls for the Department of Commerce to immediately seek industry input via a Notice of Inquiry (NOI) process. It also called for the most recent expansion of the EAR entity list to be rescinded to correct unintended controls and for the administration to act promptly to reduce the backlog of exemption license requests.

In an appendix to the letter, SEMI provided charts detailing the foreign availability of major types of semiconductor manufacturing equipment and materials. For nearly all items, there are competitive alternatives to US-origin items available from non-US sources.

However, Raimondo is expected to tell the U.S. Senate Commerce Committee the United States must “take aggressive trade enforcement actions to combat unfair trade practices from China and other nations that undercut American manufacturing,” in a speech on Tuesday, January 26.

Related links and articles:

www.semi.org

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