The U.S. government has instructed American companies that provide software used in designing semiconductors to stop selling these services to Chinese firms. This move aims to slow down China’s ability to develop advanced chips. The Financial Times reported the new restrictions on Thursday.
Sources familiar with the decision said the U.S. Department of Commerce told electronic design automation companies like Cadence, Synopsys, and Siemens EDA to stop supplying their technology to China. The Bureau of Industry and Security, a branch of the Commerce Department responsible for export controls, sent official letters to these companies to enforce the directive.
Industry experts see this step as part of the U.S. effort to contain China’s progress in key technology areas by blocking important parts of the semiconductor supply chain. However, this move may not have the intended effect. Instead, it could accelerate China’s push for independent innovation and self-reliance in semiconductor technology.
Chinese companies previously used foreign software primarily for efficiency rather than lack of research and development capability. The U.S. restrictions may encourage China to invest more in its own technology development. Rather than stopping China’s progress, these controls could act as a catalyst for China to strengthen its own semiconductor industry.
This order follows other recent U.S. actions aimed at limiting China’s ability to develop advanced artificial intelligence chips. The U.S. Department of Commerce recently released guidance that seeks to impose a global ban on advanced Chinese computing chips, including Huawei’s Ascend chips, citing potential violations of export control rules.
China’s Ministry of Commerce condemned the U.S. attempt to ban Chinese advanced chips as an act of unilateral bullying and protectionism. Chinese officials say these measures harm global semiconductor industries and disrupt supply chains worldwide.
Chinese government spokespersons have criticized the U.S. for overstretching national security concerns to block China’s chip and AI industries. They argue that the U.S. is abusing export controls and legal jurisdiction to unfairly target Chinese technology businesses. These actions are said to violate market rules and damage Chinese companies’ rights and interests.
China opposes these restrictions and urges the U.S. to stop its protectionist measures. The country has promised to take firm actions to protect its development rights and the legitimate interests of its technology companies.
This development is part of a broader competition between the U.S. and China over advanced technology sectors. Semiconductors are critical components for modern electronics, artificial intelligence, and military uses. The U.S. is increasingly restricting exports that could help China advance in these areas.
China is responding by accelerating efforts to develop its own semiconductor design and manufacturing capabilities. The country is heavily investing in domestic research and building supply chains to reduce reliance on foreign technology.
While the U.S. restrictions may cause short-term challenges, they could also drive China to become more independent in semiconductor production. This rivalry will likely continue to influence global technology markets and international relations for years to come.
