TSMC Halts Chip Shipments After Discovering Potential Sanctions Breach with Huawei

TSMC cuts off a customer that was secretly funneling chips to Huawei

Taiwanese chipmaking giant TSMC halted shipments to a customer this month after its semiconductors were sent to China's Huawei, a Taipei government official told AFP, potentially breaching U.S. sanctions. Taiwan Semiconductor Manufacturing Company is the world's largest contract manufacturer of chips used in everything from Apple iPhones to Nvidia's cutting-edge artificial intelligence hardware. Huawei, the world's leading equipment maker for fifth generation mobile internet networks, has been embroiled in a tech war between Beijing and Washington. The United States slapped sanctions on Huawei in 2019, and expanded them the following year, over fears its technology could be used for Beijing's espionage operations. Huawei denies the allegations. The sanctions cut Huawei off from global supply chains that gave it access to the U.S.-made components and technologies crucial to manufacturing powerful AI systems. The restrictions prevent TSMC from selling semiconductors to Huawei. But, TSMC discovered on October 11 that chips made for a "specific customer" had ended up with the Chinese company, a Taiwanese official with knowledge of the incident told AFP on the condition of anonymity. TSMC "immediately activated its export control procedures", halting shipments to the customer and "proactively" notifying U.S. and Taiwan authorities, the official said. In a statement on Wednesday, TSMC said it was a "law-abiding company" and had not supplied Huawei since mid-September 2020 in compliance with export controls. "We proactively communicated with the U.S. Commerce Department regarding the matter in the report," TSMC said, apparently referring to media reporting of the incident. "We are not aware of TSMC being the subject of any investigation at this time." Taiwan's economic ministry told AFP on Thursday that TSMC had informed them about the incident, but had not identified their client. "There was already an interaction and a contractual partnership in place, so it's an old client," the ministry said. They had been a client since before the 2020 deadline for companies to comply with the export controls, and "no shipments have been made since October 11", it said. Bloomberg reported Tuesday that Canadian research firm TechInsights had found an advanced processor made by TSMC inside Huawei's latest AI chip. Huawei did not respond to AFP's request for comment. The company told Bloomberg that it hadn't "produced any chips via TSMC after the implementation of the amendments made by the U.S. Department of Commerce" to its trade restrictions targeting Huawei in 2020. In response to U.S. export restrictions, Beijing has turbo-charged a drive for self-sufficiency in chips, with plans to pump billions of dollars into the sector. Huawei last year unveiled the Mate 60 Pro, a high-performance smartphone equipped with a chip that experts say would be impossible to produce without foreign technologies. That sparked debate about whether attempts to curb China's technological advancements have been effective.

Taiwan's TSMC stops shipments to client after chips sent to Huawei

TSMC halted shipments to a customer when it found out its chips were sent to Huawei, possibly breaching US sanctions. TSMC notified US and Taiwan authorities immediately. Huawei denied producing any chips through TSMC after the 2020 US trade restrictions. The incident reveals gaps in understanding China's domestic chip industry.Taiwanese chipmaking giant TSMC halted shipments to a customer this month after its semiconductors were sent to China's Huawei, a Taipei government official told AFP, potentially breaching US sanctions. Taiwan Semiconductor Manufacturing Company is the world's largest contract manufacturer of chips used in everything from Apple iPhones to Nvidia's cutting-edge artificial intelligence hardware. Huawei, the world's leading equipment maker for fifth generation mobile internet networks, has been embroiled in a tech war between Beijing and Washington. The United States slapped sanctions on Huawei in 2019, and expanded them the following year, over fears its technology could be used for Beijing's espionage operations. Huawei denies the allegations. The sanctions cut Huawei off from global supply chains that gave it access to the US-made components and technologies crucial to manufacturing powerful AI systems. The restrictions prevent TSMC from selling semiconductors to Huawei. But, TSMC discovered on October 11 that chips made for a "specific customer" had ended up with the Chinese company, a Taiwanese official with knowledge of the incident told AFP on the condition of anonymity. TSMC "immediately activated its export control procedures", halting shipments to the customer and "proactively" notifying US and Taiwan authorities, the official said. In a statement on Wednesday, TSMC said it was a "law-abiding company" and had not supplied Huawei since mid-September 2020 in compliance with export controls. "We proactively communicated with the US Commerce Department regarding the matter in the report," TSMC said, apparently referring to media reporting of the incident. "We are not aware of TSMC being the subject of any investigation at this time." Taiwan's economic ministry told AFP on Thursday that TSMC had informed them about the incident, but had not identified their client. "There was already an interaction and a contractual partnership in place, so it's an old client," the ministry said. They had been a client since before the 2020 deadline for companies to comply with the export controls, and "no shipments have been made since October 11", it said. Bloomberg reported Tuesday that Canadian research firm TechInsights had found an advanced processor made by TSMC inside Huawei's latest AI chip. Huawei did not respond to AFP's request for comment. The company told Bloomberg that it hadn't "produced any chips via TSMC after the implementation of the amendments made by the US Department of Commerce" to its trade restrictions targeting Huawei in 2020. The incident highlighted the lack of visibility into China's domestic chip industry, said Chiang Min-yen, a non-resident fellow at the Research Institute for Democracy, Society, and Emerging Technology. "External parties lack sufficient information to understand which companies are actually under Huawei's influence," Chiang told AFP. In response to US export restrictions, Beijing has turbo-charged a drive for self-sufficiency in chips, with plans to pump billions of dollars into the sector. Huawei last year unveiled the Mate 60 Pro, a high-performance smartphone equipped with a chip that experts say would be impossible to produce without foreign technologies. That sparked debate about whether attempts to curb China's technological advancements have been effective.

Taiwan's TSMC stops shipments to client after chips sent to Huawei

Taipei (AFP) - Taiwanese chipmaking giant TSMC halted shipments to a customer this month after its semiconductors were sent to China's Huawei, a Taipei government official told AFP, potentially breaching US sanctions. Taiwan Semiconductor Manufacturing Company is the world's largest contract manufacturer of chips used in everything from Apple iPhones to Nvidia's cutting-edge artificial intelligence hardware. Huawei, the world's leading equipment maker for fifth generation mobile internet networks, has been embroiled in a tech war between Beijing and Washington. The United States slapped sanctions on Huawei in 2019, and expanded them the following year, over fears its technology could be used for Beijing's espionage operations. Huawei denies the allegations. The sanctions cut Huawei off from global supply chains that gave it access to the US-made components and technologies crucial to manufacturing powerful AI systems. The restrictions prevent TSMC from selling semiconductors to Huawei. But, TSMC discovered on October 11 that chips made for a "specific customer" had ended up with the Chinese company, a Taiwanese official with knowledge of the incident told AFP on the condition of anonymity. TSMC "immediately activated its export control procedures", halting shipments to the customer and "proactively" notifying US and Taiwan authorities, the official said. In a statement on Wednesday, TSMC said it was a "law-abiding company" and had not supplied Huawei since mid-September 2020 in compliance with export controls. "We proactively communicated with the US Commerce Department regarding the matter in the report," TSMC said, apparently referring to media reporting of the incident. "We are not aware of TSMC being the subject of any investigation at this time." Taiwan's economic ministry told AFP on Thursday that TSMC had informed them about the incident, but had not identified their client. "There was already an interaction and a contractual partnership in place, so it's an old client," the ministry said. They had been a client since before the 2020 deadline for companies to comply with the export controls, and "no shipments have been made since October 11", it said. Self-sufficiency Bloomberg reported Tuesday that Canadian research firm TechInsights had found an advanced processor made by TSMC inside Huawei's latest AI chip. Huawei did not respond to AFP's request for comment. The company told Bloomberg that it hadn't "produced any chips via TSMC after the implementation of the amendments made by the US Department of Commerce" to its trade restrictions targeting Huawei in 2020. In response to US export restrictions, Beijing has turbo-charged a drive for self-sufficiency in chips, with plans to pump billions of dollars into the sector. Huawei last year unveiled the Mate 60 Pro, a high-performance smartphone equipped with a chip that experts say would be impossible to produce without foreign technologies. That sparked debate about whether attempts to curb China's technological advancements have been effective.

TSMC Chip Found in Latest Huawei AI Processor, Sparking Action Against Buyer

Apple and Nvidia chip producer Taiwan Semiconductor Manufacturing Corp has stopped chip sales to a mysterious buyer after TSMC chips ended up in Huawei Ascend 910B AI processors, according to an unnamed Taiwanese official. The 910B is a "multi-chiplet" processor, meaning it contains more than one chip and is designed for handling AI applications. The buyer whose purchases reportedly ended up in Huawei processors has not yet been named. TSMC has not yet revealed the buyer's name to the Taiwanese government, according to another official. Roughly two weeks ago, TSMC stopped selling chips to the buyer in question, according to a trade and economic official that spoke with Reuters. TSMC notified the US government that one of its chips had made it into a Huawei product just days after a report indicated the Department of Commerce was investigating TSMC. The Taiwan-based chip giant reportedly found out its chips were in 910B processors after research firm TechInsights opened one up and identified the TSMC chip. Last week, TSMC told PCMag in a statement that it is "a law-abiding company and we are committed to complying with all applicable rules and regulations, including applicable export controls. We maintain a robust and comprehensive export system for monitoring and ensuring compliance. "If we have any reason to believe there are potential issues, we will take prompt action to ensure compliance, including conducting investigations and proactively communicating with relevant parties including customers and regulatory authorities as necessary," TSMC added. The US has had sweeping export bans in place for any advanced chips to be sent to China or other US-sanctioned countries since late 2022. TSMC has allied itself with the US, and back in April received $6.6 billion in grants and billions more in loans as part of a federally-funded package to expand its chip manufacturing business in Arizona.

TSMC notifies US of potential attempt to make Huawei chip using its fabs - SiliconANGLE

TSMC notifies US of potential attempt to make Huawei chip using its fabs Taiwan Semiconductor Manufacturing Co. has notified U.S. officials about a potential attempt by a customer to circumvent export controls on chip technology. Reuters and the Financial Times reported the development today. Earlier, sources told The Information that the U.S. Commerce Department is investigating whether TSMC has made artificial intelligence or smartphone chips for Shenzen-based Huawei Technologies Co. The latter company was placed on a U.S. trade restriction list in 2019. According to today's reports, TSMC alerted the Commerce Department about an incident involving a Huawei chip known as the Ascend 910B. It's an artificial intelligence processor capable of running large language models. The Ascend 910B reportedly has similar performance as Nvidia Corp.'s A100 graphics card, which can reach a top speed of 9.7 teraflops when processing 64-bit floating point numbers. According to the Financial Times, TSMC alerted U.S. officials that it had received an order to make a processor resembling the Ascend 910B. The paper cited a source as saying that there is "no suggestion of malicious" regulatory compliance violations on the chipmaker's behalf. Another person familiar with the matter stated that a Commerce Department investigation into the matter will be "related" to TSMC, but the company is not expected to become a core focus of the probe. Sources told Reuters that the chipmaker's regulatory disclosure to the Commerce Department followed a discovery by TechInsights Inc., a Canadian market research firm. The firm reportedly analyzed an Ascend 910B and found technology from TSMC. "TSMC is a law-abiding company and we are committed to complying with all applicable rules and regulations, including applicable export controls," the chipmaker said a statement. "In compliance with the regulatory requirements, TSMC has not supplied to Huawei since mid-September 2020." In August, the Wall Street Journal reported that Huawei was gearing up to launch a successor to the Ascend 910B. The upcoming chip will reportedly offer comparable speeds to the H100, a graphics card that Nvidia launched in 2022. The H100 is about three times faster than the A100, the Nvidia chip that the current-generation Ascend 910B is reportedly designed to match in performance. The Journal's sources said that Huawei was planning to launch the new AI chip this month. It's believed the electronics maker has so far received orders for 70,000 units worth about $2 billion. In recent years, the U.S. has rolled out a series of export restrictions designed to limit the sale of advanced chips and chipmaking equipment to China. Those rules apply to, among other products, Nvidia's most capable data center graphics cards. In June, Bloomberg reported that the export restrictions could be extended to gate-all-around transistor technologies.

TSMC alerts US to potential sanctions breach from Huawei

Chip giant tells Uncle Sam someone could be making orders on the sly TSMC has reportedly tipped off US officials to a potential attempt by Huawei to circumvent export controls and obtain AI chips manufactured by the Taiwanese company. The world's largest semiconductor contract manufacturer sounded the alarm after a customer made orders for a chip resembling Huawei's Ascend 910B, a processor outfitted for training large language models, according to the Financial Times. This follows a report in The Information that the Department of Commerce was probing whether TSMC has been supplying AI or smartphone chips to Huawei in contravention of US export controls. However, TSMC said in a statement: "We proactively communicated with the US Commerce Department regarding the matter in the report. We are not aware of TSMC being the subject of any investigation at this time." The US government has increasingly clamped down on the shipping of advanced AI chips to Chinese companies over the past few years, citing national security concerns about China's military AI capabilities. Earlier today, The Register reported how Congress is tightening the screws on Japan to reduce sales of chipmaking equipment to China. Huawei in particular has long been an entity of concern for the US over fears that the company's telecoms equipment is laced with backdoors that Beijing could exploit for the purpose of espionage. China has repeatedly accused Uncle Sam of the same. Brutal sanctions against Huawei have shrunk the tech giant's bottom line amid rip-and-replace mandates for telecoms providers in the States that spread to allies in the UK and European Union. Since Huawei is arguably China's pre-eminent technology company, manufacturing consumer goods like smartphones and laptops alongside communications infrastructure and autonomous driving systems, the US has also attempted to choke off its supply of chips made with American technology - present in most of the world's semiconductor fabs - thus preventing Huawei from obtaining chips from TSMC, which manufactures more than 90 percent of the most advanced chips. A predictable side effect of these export restrictions, though, is that Beijing has embarked on a tech self-sufficiency drive, with Chinese AI patent filings surging 42 percent for 2023-24, as The Register reported this week. Likewise, Chinese chip designer Loongson has claimed that a forthcoming processor based on its instruction set architecture, LoongArch, "can reach the performance of the x86 processor under the 7nm process." In other words, it is only three to five years behind the likes of American chip giants Intel and AMD. TSMC's statement added that it is "a law-abiding company and we are committed to complying with all applicable rules and regulations, including applicable export controls. In compliance with the regulatory requirements, TSMC has not supplied to Huawei since mid-September 2020." Meanwhile, a spokesperson for the Commerce Department's Bureau of Industry and Security told the FT: "We cannot comment on whether any investigation is ongoing. BIS is committed to ensuring compliance with the robust controls we have put in place related to China's acquisition of advanced semiconductors. ®"

TSMC halts chip supply to customer after finding it in Huawei product, source says

TAIPEI, Oct 23 (Reuters) - Taiwan Semiconductor Manufacturing Co (2330.TW), opens new tab has suspended shipments to a customer after it discovered that one of its chips supplied to the client ended up in a Huawei product, according to a Taiwan official familiar with the situation. About two weeks ago, TSMC suspended shipments to the client and began a detailed investigation, the trade and economic official said, speaking on condition of anonymity given the sensitivity of the situation. Advertisement · Scroll to continue The company has notified the U.S. and Taiwanese governments, the official said as it was an "important warning event" within TSMC, and can, at its earliest, be traced back to Oct. 11. The official did not identify the client TSMC had cut off. TSMC declined comment. TSMC had alerted U.S. officials after tech research firm TechInsights took apart a Huawei product and found one of TSMC's chips, Reuters reported on Tuesday, in a possible violation of U.S. export restrictions. Advertisement · Scroll to continue The U.S. curbed the export of advanced artificial intelligence chips to China two years ago, citing the need to limit the Chinese military's capabilities. Huawei has been a primary target of the U.S. government's efforts to escalate the use of export controls to keep Chinese companies from obtaining, designing or manufacturing advanced semiconductors. Still, Chinese entities have been trying to circumvent the restrictions and have used cloud services provided by companies like Amazon (AMZN.O), opens new tab to access advanced U.S. chips and AI capabilities, Reuters reported earlier this year. Taiwan's government, wary of its giant neighbour given repeated military and other threats, has its own export control to prevent advanced chips from being made in China, and Taiwan officials say they take compliance with U.S. rules seriously. Reporting by Yimou Lee and Ben Blanchard in Taipei, Deborah Sophia in Bengaluru; Editing by Arun Koyyur Our Standards: The Thomson Reuters Trust Principles., opens new tab

TSMC told the U.S. that Huawei may have tried to skirt export controls

Taiwan Semiconductor Manufacturing Company has reportedly informed the U.S. government about a potential attempt by Huawei to have it make artificial intelligence chips for the sanctioned Chinese tech giant. The Taiwanese chipmaker said in a statement shared with the Financial Times that it "proactively communicated with the U.S. commerce department regarding" a report by The Information last week that it was under investigation for making AI or smartphone chips for Huawei, which would be a violation of U.S. export controls. "We are not aware of TSMC (TSM-1.85%) being the subject of any investigation at this time," TSMC said in the statement, adding that it "is a law-abiding company and we are committed to complying with all applicable rules and regulations, including applicable export controls." The chipmaker said it has not supplied chips to Huawei "since mid-September 2020." "If we have any reason to believe there are potential issues, we will take prompt action to ensure compliance, including conducting investigations and proactively communicating with relevant parties including customers and regulatory authorities," TSMC said in the statement. Neither TSMC, Huawei, nor the Department of Commerce immediately responded to a request for comment from Quartz. TSMC informed the Commerce Department about a customer placing orders for a chip resembling the Ascend 910B processor developed by Huawei, the Financial Times reported, citing unnamed people familiar with the matter. After seeing the order, a person close to TSMC told the Financial Times that the company also spoke to the customer related to the order, and that any investigation would be "related to" the Taiwanese chipmaker, but that it wouldn't be the focus. The chipmaker reportedly made the precursor to Huawei's chip before U.S. sanctions were placed on the Chinese tech company. A Commerce Department spokesperson told the Financial Times that its Bureau of Industry and Security is aware of The Information's report, and that it "cannot comment on whether any investigation is ongoing." TSMC's U.S.-listed shares were down around 1.5% during mid-day trading on Tuesday.

TSMC told US of chip in Huawei product after TechInsights finding, source says

TSMC said in a statement on Monday that it had proactively reached out to the Commerce Department regarding the matter. It said it had not supplied chips to Huawei since mid-September 2020.Taiwan Semiconductor Manufacturing Company notified the US that one of its chips had been found in a Huawei product after tech research firm TechInsights took apart the product, a person familiar with the matter said, revealing a possible violation of export restrictions on the Chinese company. The teardown was of Huawei's Ascend 910B, another source said. The 910B is viewed as most advanced AI chip available from a Chinese company. The first source would not identify the item, but said the TSMC chip was one within a multi-chip system. TechInsights informed TSMC of the chip before publishing its findings in a report, the person said, prompting the Taiwanese firm to notify the U.S. Commerce Department a couple of weeks ago. The revelation could show how difficult enforcing export controls can be for both companies making highly desired products and regulators. At the same time, it also shows Huawei's sustained need for the most sophisticated chips. TSMC said in a statement on Monday that it had proactively reached out to the Commerce Department regarding the matter. It said it had not supplied chips to Huawei since mid-September 2020. "We are not aware of TSMC being the subject of any investigation at this time," the company said. Huawei was placed on a U.S. trade-restriction list in 2019 for national security purposes. TechInsights, whose report has yet to be published, declined to comment. Shenzhen-based Huawei did not immediately respond to a request for comment. It is unclear how the chip made its way to Huawei. In 2019, the company released its Ascend 910 chip series. At the time, prior to export controls, the chips were produced by TSMC, two sources told Reuters earlier this year. The Information and the Financial Times have reported that the U.S. is looking into TSMC and Huawei. The Commerce Department said in a statement it is "aware of reporting alleging potential violations of U.S. export controls," but cannot comment on whether any investigation is ongoing. A third source confirmed TechInsights did a teardown of a Huawei product and found what looks like a chip manufactured by TSMC. "We maintain a robust and comprehensive export system for monitoring and ensuring compliance," TSMC said in its statement.

TSMC told US of chip in Huawei product after TechInsights finding: source

TSMC logo is seen at TSMC Museum of Innovation in Hsinchu, Taiwan, May 29. Reuters-Yonhap Taiwan Semiconductor Manufacturing Company notified the U.S. that one of its chips had been found in a Huawei product after tech research firm TechInsights took apart the product, a person familiar with the matter said, revealing a possible violation of export restrictions on the Chinese company. The teardown was of Huawei's Ascend 910B, another source said. The 910B is viewed as the most advanced AI chip available from a Chinese company. The first source would not identify the item, but said the TSMC chip was one within a multi-chip system. TechInsights informed TSMC of the chip before publishing its findings in a report, the person said, prompting the Taiwanese firm to notify the U.S. Commerce Department a couple of weeks ago. The revelation could show how difficult enforcing export controls can be for both companies making highly desired products and regulators. At the same time, it also shows Huawei's sustained need for the most sophisticated chips. TSMC said in a statement on Monday that it had proactively reached out to the Commerce Department regarding the matter. It said it had not supplied chips to Huawei since mid-September 2020. "We are not aware of TSMC being the subject of any investigation at this time," the company said. Huawei was placed on a U.S. trade-restriction list in 2019 for national security purposes. TechInsights, whose report has yet to be published, declined to comment. Shenzhen-based Huawei said in a statement it has not produced any chips via TSMC after the implementation of the U.S. rules in 2020. It is unclear how the chip made its way to Huawei. In 2019, the company released its Ascend 910 chip series. At the time, prior to export controls, the chips were produced by TSMC, two sources told Reuters earlier this year. The Information and the Financial Times have reported that the U.S. is looking into TSMC and Huawei. The Commerce Department said in a statement it is "aware of reporting alleging potential violations of U.S. export controls," but cannot comment on whether any investigation is ongoing. A third source confirmed TechInsights did a teardown of a Huawei product and found what looks like a chip manufactured by TSMC. "We maintain a robust and comprehensive export system for monitoring and ensuring compliance," TSMC said in its statement. Taiwan's government, which has its own tough rules in place to stop advanced chips being produced in China, has repeatedly said it will ensure Taiwanese tech companies follow U.S. rules. "We will have full communication with the company," Taiwan Economy Minister Kuo Jyh-huei told reporters in Taipei on Wednesday, without elaborating. (Reuters)

TSMC says it alerted US to potential violation of China AI chip controls

Taiwan Semiconductor Manufacturing Company has said it alerted the US government to a potential attempt to have it manufacture artificial intelligence chips for Chinese technology group Huawei in circumvention of export controls. The Information, a technology news publication, reported last week that the Department of Commerce was investigating whether TSMC had been violating US export controls by making AI or smartphone chips for Huawei. TSMC, the world's largest contract chipmaker, said it had itself brought the issue to Washington's attention. "We proactively communicated with the US commerce department regarding the matter in the report. We are not aware of TSMC being the subject of any investigation at this time," the company said in an emailed statement. Two people familiar with the situation said TSMC had recently notified the commerce department after a customer placed orders for a chip that resembled Huawei's Ascend 910B, a processor designed for large language model training. TSMC manufactured the precursor of the 910B chip before the US sanctions came into force. Over the past few years, Washington has used a widening array of export controls to try to make it impossible for Chinese companies to obtain the most advanced semiconductors or to design and manufacture them. Huawei has been one of the main targets of that effort, which reflects the two superpowers' intensifying competition for technology leadership. One of the key tools in the export controls is a rule that bars chip manufacturers worldwide from using US technology or equipment to make chips destined for Huawei or for use in its products. Since every semiconductor fabrication plant, or fab, uses some specialised US-made tools, that rule was expected to block Huawei from obtaining chips made by TSMC. The Taiwanese company accounts for more than 90 per cent of the market for the most advanced chips. "TSMC is a law-abiding company and we are committed to complying with all applicable rules and regulations, including applicable export controls," the company said in its statement. "In compliance with the regulatory requirements, TSMC has not supplied to Huawei since mid-September 2020." One person close to TSMC said the company, after receiving an order that raised doubts, had spoken both to the customer involved and to the commerce department. The department's investigation of the issue would be "related to" TSMC, but the company would not be the target of a probe, the person said. Another person familiar with the situation said there had been "conversations" between the department and the company about a potential attempt at circumvention of export controls, but there was no suggestion of malicious compliance violations on TSMC's part. TSMC said it maintained a "robust and comprehensive export system" to ensure compliance. "If we have any reason to believe there are potential issues, we will take prompt action to ensure compliance, including conducting investigations and proactively communicating with relevant parties including customers and regulatory authorities," it added.

Reports Allege that Huawei is Using TSMC Hardware for its AI Technologies - Phandroid

While TSMC is known for its work on different chips from different brands - the most popular being Qualcomm's Snapdragon chips - it seems like an unexpected "client" has stirred some trouble between the company and the US government. More specifically, new information indicates that the US Department of Commerce's Bureau of Industry and Security has been investigating reports of TSMC chips being used in Huawei hardware, implying a possible violation of US export regulations. Given the spat between Huawei and the US government, one can imagine the fallout that this might lead to. TSMC is likewise aware of the issue - it's claimed that a third-party client provided TSMC processors for Huawei, a transaction that TSMC was not made aware of. The components were reportedly used for Huawei's AI servers. TSMC has since stated that it is a "law-abiding company" and is committed to complying with operational regulations as required. Meanwhile, Huawei denies obtaining TSMC hardware; it is also unclear if the third party client (unnamed as of the moment) was operating under Huawei, or where it is based for that matter. Currently, the Chinese company uses components manufactured by Semiconductor Manufacturing International Corporation (SMIC), a major chip manufacturer based in China.

TSMC says it has alerted U.S. of potential China AI chip curbs violation

TSMC offices in San Jose, California, US, on Thursday, April 18, 2024.David Paul Morris | Bloomberg | Getty Images Taiwan Semiconductor Manufacturing Company said on Tuesday it has informed the United States of a potential attempt by Huawei to circumvent U.S. export controls prohibiting the chipmaker from producing AI chips for the Chinese company. The U.S. government restricted the export of high-end AI chips to China two years ago, citing the need to limit the Chinese military's capabilities. "We are not aware of TSMC being the subject of any investigation at this time," the company said in a statement, adding that it has not supplied to Huawei since mid-September 2020. TSMC's U.S.-listed shares were down 1.5%. A crucial element of export controls is a rule prohibiting global chip manufacturers from utilizing U.S. technology or equipment to produce chips intended for Huawei or its products. In recent years, the United States has escalated its use of export controls, aiming to thwart Chinese companies from obtaining, designing, or manufacturing advanced semiconductors. Huawei, a primary target of these efforts, epitomizes the growing technology rivalry between Beijing and Washington. TSMC informed the U.S. Commerce Department after a customer placed orders for a chip similar to Huawei's Ascend 910B, a processor designed for large language model training, a Financial Times report said earlier in the day, citing people familiar with the matter. The Commerce Department and Huawei did not immediately respond to Reuters requests for comments.

TSMC Notifies US About Deal With China's Huawei, Claims It Isn't The Subject of Investigation For Now

TSMC has notified the US about a potential semiconductor deal with China, claiming that the Taiwan giant isn't the subject of investigation for now. A new fiasco has evolved in the semiconductor industry, where the famous research firm TechInsights has reportedly torn down one of Huawei's Ascend 910B AI chips, only to find out that it utilizes TSMC's semiconductor, which became a matter of huge concern given that TSMC was being pointed out in violation of the US export restrictions. However, a new report by Reuters claims that TSMC had already notified the US Department of Commerce about Huawei's use of its chips and that the Taiwan giant isn't under scrutiny for now. We proactively communicated with the US commerce department regarding the matter in the report. We are not aware of TSMC being the subject of any investigation at this time. TSMC is a law-abiding company and we are committed to complying with all applicable rules and regulations, including applicable export controls. In compliance with the regulatory requirements, TSMC has not supplied to Huawei since mid-September 2020 - TSMC via The Financial Times Interestingly, just last week, the US Department of Commerce initiated an investigation into whether TSMC was involved in a potential violation of US export controls, so the Huawei plot came at a somewhat surprising time. Diving a bit into details, the Financial Times claims that TSMC notified US authorities when a customer placed orders for a chip resembling Huawei's Ascend 910B and that the firm went to complete the orders since the US sanctions weren't effective then. So indirectly, TSMC won't be under the influence of the investigation; rather, the customer who placed the order will face the scrutiny process. Well, the story is indeed interesting, and here is where we add our touch. China is a market that companies simply cannot ignore, given that the rapid development rates are prompting big tech firms to collaborate with Chinese companies through legal means or other methods that might be deemed illegal. TSMC is a key rooter for the US, there is no doubt about that, but China did play a massive role in the company's finance pre-US sanctions, and if you look at the situation now, TSMC is barred away from doing business with China. On the other end, well the report does show that China is far away from developing capable semiconductors, and while industry news does show that the nation is evolving rapidly, it still is far away from reaching the technology level provided by the likes of TSMC; hence the balance of the scale is heavily tipping away from China, at least for now.

US suspects TSMC helped Huawei skirt export controls, report says

Yesterday, it was reported that the US Department of Commerce is investigating the Taiwan Semiconductor Manufacturing Co. (TSMC) over suspicions that the chipmaker may have been subverting 5G export controls to make "artificial intelligence or smartphone chips for the Chinese tech giant Huawei Technologies," sources with direct knowledge told The Information. The Department of Commerce has yet to officially announce the probe and declined Ars' request for comment. But TSMC promptly issued a statement today, defending itself as "a law-abiding company" that's "committed to complying with laws and regulations, including export controls." For the past four years, the US has considered Huawei a national security risk after Huawei allegedly provided financial services to Iran, violating another US export control. In that time, US-China tensions have intensified, with the US increasingly imposing tariffs to limit China's access to US tech, most recently increasing tariffs on semiconductors. As competitiveness over AI dominance has heightened, Congress also recently introduced a bill to stop China and other foreign adversaries from accessing American-made AI and AI-enabling technologies. Since US officials have long considered Huawei to be a state-controlled entity and blocked Huawei from accessing US-made 5G chips considered essential for AI applications, it was concerning when Huawei launched the Mate 60 smartphone with 5G chips. As 9to5Mac put it, "Nobody could understand how that was possible given that Chinese companies did not have the technology required to make the chips." In addition to potentially manufacturing the smartphone chips, the US suspects that TSMC may have helped Huawei design its own AI chips, sources told The Information. Under US export controls, any company using US technology to produce competing chips is banned from selling those chips to Huawei. And companies are expected to monitor to ensure that their customers aren't aiding Huawei in getting around the export controls.

Huawei's latest AI processors were allegedly made by TSMC: Report

Huawei's latest AI processor called HiSilicon Ascend 910B has been produced by TSMC, according to analysts from TechInsights cited by Bloomberg. Both Huawei and TSMC deny any collaborations in the recent years in accordance with the U.S. export restrictions. However, it is possible that TSMC produced and shipped the chips before sanctions came into effect. In accordance with sweeping sanctions against China-based Huawei, TSMC had to obtain an export license from the U.S. Department of Commerce to ship any chips or products to Huawei after September 15, 2020. Before that date, TSMC made Huawei's Ascend 910 processor for AI training using its N7+ fabrication technology that relies on both EUV and DUV lithography. "TSMC is a law-abiding company, and we are committed to complying with all applicable rules and regulations, including applicable export controls," a statement by TSMC published by Bloomberg reads. "In compliance with the regulatory requirements, TSMC has not supplied to Huawei since mid-September 2020. We proactively communicated with the U.S. Commerce Department regarding the matter in the report. We are not aware of TSMC being the subject of any investigation at this time." Earlier this week TSMC indicated that Huawei had attempted to use a proxy to produce its Ascend 910B processor at TSMC, but the foundry uncovered the plan and denied its services. Huawei's Ascend 910 is a massive system-in-package consisting of a Virtuvian AI processor, Nimbus V3 I/O die, and four HBM2E. Given that this is a highly-complex SoC, it is impossible for Huawei to 'sneak' its design to TSMC using an intermediary and make the contract chipmaker believe that it was developed by that intermediary. Eventually, it was reported that Huawei's Ascend 910B was produced by China-based SMIC using its 2nd Generation 7nm-class process technology. However, now TechInsights reportedly claims that the processor was made by TSMC, whereas Huawei told Bloomberg the Ascend 910B does not exist. Considering the fact that TSMC used to produce the Ascend 910 processor and Huawei probably acquired a lot of those chips before the U.S. imposed restrictions, it is possible that the company has or had them in stock and sold to its clients long after the U.S. export curbs were set. In this case, neither TSMC nor Huawei circumvented the U.S. sanctions. But, it is hard to believe that Huawei had enough Ascend 910 units in stock to sell over half of a million of such processors this year alone. It is also possible that the U.S. government granted an export license to TSMC to supply AI processors to Huawei. Although the U.S. DoC's sweeping sanctions are meant to hurt companies and states, the U.S. government still grants some export licenses as bargain cards with foreign governments. While Huawei's Ascend 910 (and/or 910B) is one of the company's most advanced processors ever developed, it only supports INT8 and FP16 data formats (i.e., they cannot be used for supercomputers or serious simulations such as those required to build weapons of mass destruction), it cannot beat Nvidia's A100 and it is believed that Nvidia's HGX H20 beats it in real-world situations. Therefore, the U.S. government may not consider the Ascend 910 as a threat, so it is possible that Huawei could legally obtain them even after mid-September, 2020. Of course, this is just a speculation.

TSMC Alerts US After Its Chip Is Found In Huawei's AI Product, Potentially Violating Export Rules - Taiwan Semiconductor (NYSE:TSM)

Taiwan Semiconductor Manufacturing Company TSM has reportedly informed the U.S. about a chip in a Huawei Technologies Co. product, following reports by a tech research firm. What Happened: TSMC notified the U.S. Commerce Department after TechInsights discovered one of its chips in a Huawei product, a source familiar with the matter told Reuters. The product in question was Huawei's Ascend 910B, which is considered the most advanced AI chip from a Chinese company. The TSMC product in question is part of a multi-chip system, according to the report. The company was alerted about the chip by TechInsights before the research firm published its findings. This prompted TSMC to notify the U.S. Commerce Department a few weeks ago. TSMC stated on Monday that it had reached out to the Commerce Department proactively. The company also confirmed that it had not supplied chips to Huawei since mid-September 2020. Huawei, on the other hand, stated that it has not procured any chips from TSMC after the U.S. rules were implemented in 2020. "TSMC is a law-abiding company and we are committed to complying with all applicable rules and regulations, including applicable export controls," a company spokesperson said in a statement on Wednesday, according to CNBC. See Also: Bitcoin, Ethereum, Dogecoin On The Rise As 'Uptober' May Be Finally Here Why It Matters: TSMC's disclosure comes amid a surge in demand for AI chips, particularly from companies like Nvidia Corp., which has seen its shares soar to new heights. The U.S. Commerce Department is already investigating TSMC for potential violations of export controls, which could disrupt chip production for Apple Inc. AAPL. Despite these challenges, TSMC's strong performance in the third quarter and its ongoing technological advancements, such as the 3nm chip, have led to bullish forecasts from analysts. Industry experts, including Gene Munster, predict a bull market driven by AI, despite short-term fluctuations, indicating that the demand for advanced chips is likely to continue. TSMC did not immediately respond to Benzinga's request for comment. Price Action: TSMC closed at $198.48 on Tuesday, down 1.72% for the day. In pre-market trading, the stock further declined by 0.76%. Year to date, the stock has surged 95.49%, according to data from Benzinga Pro. Read Next: Man Who Accidentally Threw Hard Drive Containing 8,000 Bitcoins Worth Half A Billion Dollars In Landfill Sues Local City Council For Not Excavating The Site Image Via Shuttertock This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote Market News and Data brought to you by Benzinga APIs

TSMC says it has alerted US of potential China AI chip curbs violation, FT reports

Oct 22 (Reuters) - Taiwan Semiconductor Manufacturing Company (TSMC) (2330.TW), opens new tab said it has informed the United States of a potential attempt to have it manufacture AI chips for China's Huawei in circumvention of export controls, the Financial Times reported on Tuesday. The U.S. Commerce Department was investigating if TSMC had been making chips for China's Huawei (HWT.UL), whose access to non-Chinese chips has been curbed by U.S. export controls. Advertisement · Scroll to continue TSMC, which counts Apple (AAPL.O), opens new tab and Nvidia (NVDA.O), opens new tab among its customers, has benefited from a surge in AI development across a spectrum of industries. The Taiwanese chip manufacturer, the Commerce Department and Huawei did not immediately respond to Reuters requests for comments. Reporting by Akash Sriram in Bengaluru; Editing by Shinjini Ganguli Our Standards: The Thomson Reuters Trust Principles., opens new tab

U.S. Probes TSMC's Dealings With Huawei

The U.S. Commerce Department is investigating whether Taiwan Semiconductor Manufacturing Co. has been making artificial intelligence or smartphone chips for Chinese tech giant Huawei Technologies in what would be a breach of U.S. export rules, said two people with direct knowledge of the matter. Since 2020, the U.S. has banned Huawei from buying chips manufactured using American equipment, citing national security concerns. The U.S. restrictions also block Huawei from using U.S. technology to make its own chips without approval from the Commerce Department. In recent weeks the department has contacted TSMC to ask whether it was involved in making either smartphone chips or AI chips for Huawei, the people said.

Huawei appears to still be using TSMC chips despite US sanctions

The tech giant seems to be unable to make its advanced chips in China. A Canadian research firm called TechInsights took a deep dive on one of Huawei's artificial intelligence accelerators and found a chip manufactured by Taiwan Semiconductor Manufacturing Company (TSMC). spoke with several people familiar with the investigation who asked to remain anonymous since TechInsights' report has been released to the public. The anonymous sources says TechInsights' investigation found an Ascend 910B chip made by TSMC in one of Huawei's AI accelerators. The company that conducted the investigation declined to comment. The US Commerce Department implemented additional against Huawei that barred the electronics company from obtaining chips made by foreign firms. Earlier this year, the US government tightened its restrictions even further by revoking its licenses with to produce chips for its devices. TSMC denied that it had a working relationship with Huawei since mid-September of 2020 in a statement provided to the Commerce Department. TSMC also told Bloomberg that it hasn't produced any chips for Huawei due to the amended restrictions. Huawei denied that it had ever "launched the 910B chip." This isn't the first time Huawei has been caught trying to subvert US sanctions and trade restrictions. Bloomberg also uncovered in May that at universities including Harvard by funneling the money through a Washington-based scientific research foundation called Optica. The foundation said in June and chief executive officers Elizabeth Rogen and Chad Stark stepped down the following August.

TSMC alerts U.S. to possible AI chip sanctions breach by Huawei | AppleInsider

TSMC has advised the U.S. that there was an attempt by Huawei to violate sanctions against China restricting the export of AI chips to China, as the probe that could affect Apple chip production rolls on. The United States introduced controls in 2022 that severely restricts any exports of AI chips to China. Two years later, TSMC is warning that there was an attempt to break those rules. TSMC told the US Commerce Department that a customer had placed an order for chips that seemingly breached the sanctions, reports Reuters. The customer attempted to order a chip that was similar in design to the Ascend 910B, a processor designed by Huawei. This chip in particular was made to be used for large language model training, a process in AI production. TSMC, the Commerce Department, and Huawei did not respond to comment requests from the publication. The alert to the Commerce Department arrives at a time when TSMC faces a probe into a very similar situation. On October 18, it was revealed that the Commerce Department was investigating a potential sanctions breach by TSMC. A block in 2020 prevented Huawei from accessing components from U.S. companies without approval from the Department. The rules also prevented access to chips made using U.S.-sourced equipment. This includes TSMC, which uses such hardware to produce its chips. The probe was intended to determine if TSMC had made smartphone or AI chips for Huawei. This was apparently via an intermediary firm that masked Huawei as its client, with the probe determining if TSMC had performed enough checks on the client before production began. If the probe found TSMC had broken sanctions, it faced penalties including sanctions of its own. The latter could be more damaging, as it could directly impact the production of chips for clients, which includes Apple.

TSMC denies U.S. is probing the company after report suggests blacklisted Huawei is using its chips

The logo for Taiwan Semiconductor Manufacturing Company is displayed on a screen on the floor of the New York Stock Exchange on Sept. 26, 2023. Taiwan Semiconductor Manufacturing Company has denied that the U.S. was investigating its dealings with Chinese tech company Huawei, following reports that its chips were found in the Shenzhen-based firm's products. "TSMC is a law-abiding company and we are committed to complying with all applicable rules and regulations, including applicable export controls," a company spokesperson told CNBC in a statement on Wednesday. Tech-focused publication The Information had reported last week that the Commerce Department was probing whether TSMC had been making AI or smartphone chips for Huawei, in violation of U.S. export rules. "We proactively communicate with the U.S. Commerce Department regarding the matter in the report. We are not aware of TSMC being the subject of any investigation at this time," the TSMC spokesperson added. Huawei was placed on a U.S. trade blacklist in May 2019 over national security concerns. TSMC, which is the world's largest contract chip manufacturer, said that it has not supplied chips to Huawei since mid-September 2020. Separately, Reuters reported Tuesday that one of TSMC's chips had recently been found in a Huawei product, indicating possible export violations and prompting the chip maker to notify the Commerce Department. Citing anonymous sources, the report claimed the discovery was made after tech research firm TechInsights took apart a Huawei product and found a TSMC chip as part of its multi-chip system. TechInsights has yet to release a public report on its findings and has not yet responded to a request for comment from CNBC. TSMC declined to comment further on the specific claims made in the Reuters report. There has been renewed attention on Huawei and its access to advanced semiconductor tech since it released a smartphone containing a 5G chip, a technology that the U.S. had sought to restrict the company from accessing. The U.S. Commerce Department and Huawei did not immediately respond to requests for comment.

TSMC told U.S. of chip in Huawei product after TechInsights finding, source says

Taiwan Semiconductor Manufacturing Company notified the U.S. that one of its chips had been found in a Huawei product after tech research firm TechInsights took apart the product, a person familiar with the matter said, revealing a possible violation of export restrictions on the Chinese company. The teardown was of Huawei's Ascend 910B, another source said. The 910B is viewed as most advanced AI chip available from a Chinese company. The first source would not identify the item, but said the TSMC chip was one within a multi-chip system. TechInsights informed TSMC of the chip before publishing its findings in a report, the person said, prompting the Taiwanese firm to notify the U.S. Commerce Department a couple of weeks ago.

Huawei Technologies' Latest AI Processors Were Made by TSMC

An investigation of Huawei Technologies Co.'s latest AI offering has unearthed an advanced processor made by Taiwan Semiconductor Manufacturing Co., suggesting that China is still struggling to reliably make advanced chips in sufficient quantities. Canada-based research firm TechInsights recently took apart at least one of the Shenzhen conglomerate's highest-end artificial intelligence accelerators and discovered an Ascend 910B chip manufactured by TSMC, according to people familiar with a recent teardown of the devices. They requested anonymity to discuss a report that isn't public.