WASHINGTON– The U.S. Commerce Department said it will revoke the “validated end-user” (VEU) status of South Korean tech giants Samsung Electronics and SK hynix, a move that will force the companies to obtain licenses to ship U.S. chipmaking equipment to their factories in China.
In a notice posted on the Federal Register, the Bureau of Industry and Security said the revised authorisations list will also remove Intel Semiconductor Ltd. The department added it does not intend to approve licenses for capacity expansion or technology upgrades at the firms’ Chinese plants, Yonhap reported.
Samsung and SK hynix had been granted VEU status under the Biden administration, allowing them to ship certain semiconductor tools to pre-approved sites without seeking individual export licenses. The new decision, which takes effect 120 days after its publication on September 2, is aimed at closing what officials called a “Biden-era loophole.”
“The Trump Administration is committed to closing export control loopholes — particularly those that put U.S. companies at a competitive disadvantage. Today’s decision is an important step towards fulfilling this commitment,” said Jeffrey Kessler, Under Secretary of Commerce for Industry and Security, in a statement.
The U.S. has steadily tightened export controls on advanced technologies to China as rivalry deepens over semiconductors, security, and broader geopolitical competition.
South Korea’s Ministry of Trade, Industry and Energy said Seoul had been briefed in advance and pledged to work with Washington to limit the fallout for domestic chipmakers. “The government has been closely communicating with the U.S. Department of Commerce on possible adjustments to the VEU system, stressing the importance of smooth operations of our chipmakers’ Chinese facilities for global semiconductor supply chain stability,” the ministry said. “Even if VEU status is withdrawn, we will continue to work with the U.S. to ensure any impact on Korean companies is minimised.” (Source: IANS)
