BIS Includes HBM in New Export Control Rules for AI Chip Export to China
The US Department of Commerce’s Bureau of Industry and Security (BIS) has introduced a new set of export control rules to limit China’s ability to develop advanced semiconductors and technologies critical to its military applications. These measures aim to prevent the People’s Republic of China (PRC) from leveraging advanced-node semiconductors for weapons systems, artificial intelligence (AI), and military modernization efforts.
The high bandwidth memory (HBM) products, key components in AI servers, are now included in the list of restricted products.
Rumors about tightening restrictions on semiconductor equipment and AI chip exports to China have been circulating for some time. A Center for Strategic and International Studies (CSIS) report said Applied Materials, KLA, and Lam Research — had increased their non-US manufacturing and sourcing components out of China.
Key Takeaways
Expanded Export Controls
New restrictions apply to 24 types of semiconductor manufacturing equipment and 3 types of software tools used for advanced-node semiconductor production.
High-bandwidth memory (HBM), essential for AI and advanced computing, is now subject to tighter controls under the Foreign Direct Product (FDP) rule.
Entity List Additions
140 entities and 14 modifications have been added to the Entity List, including PRC semiconductor fabs, tool manufacturers, and investment companies supporting China’s advanced chip goals.
New Regulatory Measures
Creation of two new FDP rules targeting foreign-produced semiconductor equipment destined for China or entities supporting China’s military modernization.
Enhanced controls on software and technologies like Electronic Computer Aided Design (ECAD) and Technology Computer Aided Design (TCAD).
Clarification that export controls also cover software keys used to access restricted hardware or software.
Strategic Objectives
Impair China’s ability to indigenize advanced semiconductor technologies.
Restrict the PRC's development of advanced AI with potential applications in warfare and repression.
Prevent the PRC from exploiting U.S.-origin technology for weapons of mass destruction (WMD) and other military purposes.
National Security Justification
The PRC’s Military-Civil Fusion strategy poses a significant threat by enabling the use of commercial technology for military purposes.
These measures aim to protect U.S. and allied national security while addressing human rights concerns, such as the potential use of advanced technologies for surveillance and repression.
Implementation Timeline and Feedback
The rules are effective immediately, with certain compliance deadlines extended to December 31, 2024.
Public comments are invited on the Interim Final Rule.