TSMC Ends Supply to Client for Huawei Chip Transfers
- TSMC, the world's largest contract chip manufacturer, discovered some semiconductors intended for a specific customer were funneled to Huawei.
- The U.S. imposed sanctions on Huawei in 2019, expanding them in 2020, restricting its access to critical chip technologies.
- In response to this breach, TSMC halted shipments to the unidentified customer and reported the incident to U.S. and Taiwanese authorities.
The incident involving Taiwan Semiconductor Manufacturing Company (TSMC) came to light in October 2020, when the company discovered that semiconductors meant for a specific client had ended up with Huawei, a leading Chinese tech firm embroiled in trade restrictions with the U.S. These restrictions, established in 2019 and further intensified in 2020, prevent Huawei from obtaining essential components crucial for its technological operations, primarily due to concerns over potential espionage activities linked to Beijing. In direct compliance with these sanctions, TSMC had not supplied any chips to Huawei since mid-September 2020. However, the revelation of the diversion prompted TSMC to activate its export control measures, discontinuing shipments to the unidentified customer, which has been noted as a longstanding client before the sanctions were imposed. The Taiwanese economic ministry confirmed that TSMC had informed them about the situation, highlighting the proactive steps taken by the company to maintain adherence to export laws. Despite the incident raising concerns, TSMC stated that they were not under investigation at that time. This situation underscores the ongoing complexities within the global technology supply chain, particularly in light of the geopolitical tensions between the U.S. and China, emphasizing the challenges companies face when navigating compliance in a shifting regulatory landscape.