[News] Strengthening Controls on Semiconductor Equipment Exports to China, Japan Reportedly Tightens Export … – Press Center | TrendForce – Market research, price trend of DRAM, NAND Flash, LEDs, TFT-LCD and green energy, PV
Japan is reportedly planning to expand export restrictions on four technologies related to semiconductors or quantum computing, as per a report from Bloomberg. This move is said to represent the latest initiative in global efforts to control the transfer of strategic technologies.
The same report indicates that Japan’s new measures will affect the export of scanning electron microscopes used for analyzing nano-particle images, as well as the technology for improving semiconductor design known as Fully Depleted Silicon on Insulator (FD-SOI) technology. Japan will also require licenses for the low-temperature CMOS circuits used in quantum computers, as well as for the outputs of quantum computers themselves. These restrictions apply to Japan’s most significant trading partners, including South Korea, Singapore, and Taiwan.
The Japanese Ministry of Economy, Trade, and Industry recently stated that the purpose of this plan is to better regulate the export of components for military purposes and to align with similar initiatives around the world. Reportedly, the Ministry emphasized that after public consultations ending on May 25th, while this plan is expected to take effect as early as July.
In fact, in 2023, Japan expanded export restrictions on 23 types of cutting-edge semiconductor manufacturing technologies. The implementation of these controls followed after the United States restricted China’s access to crucial semiconductor fabrication technologies. At that time, reportedly, Washington officials lobbied international partners such as Japan and the Netherlands to impose trade sanctions on China, aligning with the U.S. view of China as a geopolitical and potential military competitor.
Export controls chief Alan Estevez, as reported by Reuters during an annual conference, emphasized the importance of discussions with allies regarding key component servicing. He mentioned ongoing efforts to assess which components require servicing, hinting at the US’s reluctance to impose restrictions on non-core components that Chinese firms can repair independently.
Since then, the US has reportedly been urging allies such as the Netherlands, Germany, South Korea, and Japan, urging them to further tighten restrictions on China’s access to advanced chip technology.
According to a previous report from Nikkei News, the U.S. government initiated semiconductor export controls in various fields, including manufacturing equipment, in October 2022. This decision stems from the belief that semiconductors, which play a crucial role in new-generation technologies such as AI and autonomous driving, are strategic commodities directly related to national power.
Consequently, the U.S. government requested further cooperation from Japan and the Netherlands, leading to both countries strengthening their controls in 2023. However, despite these measures, exports of related products, excluding those under control, to China are sharply increasing. Therefore, the U.S. government believes it is necessary to urge Japan and the Netherlands, which have advantages in semiconductor manufacturing equipment, to take further actions.
Currently, manufacturing equipment required for advanced semiconductors with range of 10 to 14 nanometers and below are subject to export control restrictions. The United States is pushing to expand regulations to include certain equipment for what are known as general-purpose semiconductors.
This request is believed to potentially encompass exposure equipment used on silicon wafers, as well as etching equipment for three-dimensional stacking in. Among Japanese companies, Nikon and Tokyo Electron possess advanced capabilities in this field.
The same report from Nikkei News further notes that the restrictions also extend to materials related to Shin-Etsu Chemical Industries, such as photosensitive materials, and demand restrictions on exports to China. Additionally, the United States is preparing to request that the Netherlands cease providing maintenance and services for manufacturing equipment sold to China before the 2023 regulations. The strengthened control will also have a certain impact on allied countries.
Currently, Dutch company ASML is believed to still be providing such services to Chinese buyers. Per ASML’s financial report, during Q1, machine revenue from the Chinese market increased significantly from the previous quarter’s 39% to 49%.
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(Photo credit: ASML)