The Trump administration has reportedly issued new directives to US technology firms, ordering them to stop the sale of semiconductor design software to Chinese companies. This action is seen as a part of Washington's ongoing effort to restrict China's access to advanced technologies, especially in the development of artificial intelligence (AI) chips. Last month, the US also imposed new limits on Nvidia ’s AI chip exports to China.
Citing sources familiar with the matter, a report by The Financial Times claimed that the US Department of Commerce’s Bureau of Industry and Security (BIS) has sent letters to tech companies, instructing them to stop providing services that could support China’s chip development capabilities.
Tech companies that have been sent 'ban' letters
The move targets electronic design automation (EDA) companies such as Cadence Design Systems, Synopsys , and Siemens EDA. EDA software plays a crucial role in chip design and testing.
The three targeted companies make up approximately 80% of China’s EDA software market. Synopsys generated nearly $1 billion in revenue from China in fiscal 2024, while Cadence reported $550 million.
A Commerce Department official confirmed to the publication that the agency is reviewing exports related to strategic concerns with China and, in some cases, has suspended or added licensing requirements.
US and China agree to temporary halt additional tariffs
The directive comes amid ongoing trade negotiations between the US and China, which agreed to a temporary 90-day halt on additional tariffs in Geneva. Previous reports indicated that the Trump administration planned to blacklist several Chinese chipmakers but delayed action to avoid disrupting talks.
Though the Biden administration previously imposed restrictions on high-end EDA tools in 2022, US companies have continued selling versions of their products that comply with existing export laws. This latest move adds pressure to limit those sales further.
Citing sources familiar with the matter, a report by The Financial Times claimed that the US Department of Commerce’s Bureau of Industry and Security (BIS) has sent letters to tech companies, instructing them to stop providing services that could support China’s chip development capabilities.
Tech companies that have been sent 'ban' letters
The move targets electronic design automation (EDA) companies such as Cadence Design Systems, Synopsys , and Siemens EDA. EDA software plays a crucial role in chip design and testing.
The three targeted companies make up approximately 80% of China’s EDA software market. Synopsys generated nearly $1 billion in revenue from China in fiscal 2024, while Cadence reported $550 million.
A Commerce Department official confirmed to the publication that the agency is reviewing exports related to strategic concerns with China and, in some cases, has suspended or added licensing requirements.
US and China agree to temporary halt additional tariffs
The directive comes amid ongoing trade negotiations between the US and China, which agreed to a temporary 90-day halt on additional tariffs in Geneva. Previous reports indicated that the Trump administration planned to blacklist several Chinese chipmakers but delayed action to avoid disrupting talks.
Though the Biden administration previously imposed restrictions on high-end EDA tools in 2022, US companies have continued selling versions of their products that comply with existing export laws. This latest move adds pressure to limit those sales further.
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