This industry has not escaped the rise of the Sino-American rivalry or what some have called the tech war between Washington and Beijing. Under the Trump administration, a series of measures have been taken to limit China’s access to American semiconductor design technology, particularly those that are 7 nanometers (nm), 5 and soon to be 2 nanometers. These latest generation semiconductors are designed only in the United States. Their advantage is that they are smaller and more efficient in terms of information transmission speed. They enter into the manufacture of high-tech products from major brands such as Alibaba or Apple. And above all, they will be increasingly necessary to enable the development of 5G communication networks and cloud computing.

The American strategy that we are going to decipher here took place in several stages starting in 2018. It began with a public diplomatic campaign against a Chinese company, Huawei, then moved on to the implementation of internal regulations limiting the access of Chinese companies to American latest-generation (7nm and sub-7nm) semiconductor technology. At the same time, the US administration carried out a complete overhaul of the control system for semiconductor exports to China. Consequences of these various measures: more restricted access for China to microprocessor technology, whether sold directly to China or through production carried out in third countries using American technology. This last scenario then falls within the framework of the application of the principle of extraterritoriality of American law [i], a tool used as a weapon in the technological war against China. These actions of the Trump administration and then the Biden administration, whatever their form, are partly explained by the practices of intellectual property theft carried out by Chinese actors. These practices and the associated shortfall have affected the entire US semiconductor industry. Qualcomm, Intel or Micron have suffered the effects.

In May 2019, the Bureau for Industry and Security (BIS) [ii] of the United States Department of Commerce decided to place the Chinese telecommunications equipment production company Huawei on an “Entity list”. Once on this list, US exporters who worked with Huawei had to obtain a special export license. In the eyes of the US administration, Huawei at that time violated the financial sanctions applied by the United States to Iran [iii]. Google’s export of Android software to Huawei was stopped by this measure and Huawei could no longer market phones with Android software and updates. The Chinese company had to speed up the development of its own software for its smartphones.

A year later in May 2020, the same Bureau for Industry and Security (BIS) of the Department of Commerce announced that export licenses would now be requested for the sale of the design part of microprocessors. This new technology, which particularly concerns 7-nanometer microprocessors, includes a share of American intellectual property since it has given rise to the filing of new patents. This US regulation has created uncertainty around Huawei. The company could no longer guarantee the sale of smartphones and telecommunications equipment (5G) containing American technology microprocessors. This could slow down its production and harm its competitiveness. Moreover, these settlements have highlighted Huawei’s reliance on American technology.

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