Report: US pushes for equipment restrictions on Chinese chipmakers

07 July 2022

The U.S. government is looking to restrict sales of semiconductor equipment to Chinese chipmakers in a continued bid to stymie the country’s plans to develop a homegrown semiconductor powerhouse.

According to a report from Bloomberg, the American government is pushing for Dutch chip manufacturing equipment provider ASML Holdings NV to stop selling any future semiconductor equipment to Chinese chipmakers.

ASML has already been unable to ship its most advanced tools to China, but the report said the U.S. government wants to now restrict the sale of older machines as well.

The government’s move follows restrictions that the Trump Administration declared in 2019 adding Huawei Technologies and its affiliates to the U.S. Bureau of Industry and Security (BIS) Entity List. The move effectively blacklisted Huawei from doing business with U.S. chipmakers without these companies having to apply for a special export license.

The Trump Administration slapped Semiconductor Manufacturing International Corp. (SMIC), China’s largest semiconductor foundry, with similar restrictions in 2020. That ban was seen as more severe to China’s overall desire to grow its domestic semiconductor industry because SMIC relies on U.S. equipment and software for production processes such as printing circuits and inspecting products.

What is lithography?

ASML is one of the leading providers of lithography systems that are vital in semiconductor manufacturing, particularly in low process nodes that produce the most advanced chips. The technology is used by leading foundries Taiwan Semiconductor Manufacturing Co and Samsung as well as Intel, which has recently created its own foundry services.

Lithography is performed before etching steps so that materials can be selectively removed by the etch, instead of etching the entire surface. Each pattern where silicon, oxide layers, barrier layers and others are removed require a pattern or mask.

These lithography systems cost hundreds of millions of dollars and the technology is performed in several steps.

  1. A photoresist layer is applied with a spin coating process.
  2. Then, the photoresist is exposed to light of a certain wavelength, which causes it to chemically change.
  3. Finally, some of the photoresist is selectively etched leaving behind the desired pattern.

Restricting use

Currently, lithography and other chip manufacturing equipment require an export license and since 2019 the Dutch government, in an agreement with the U.S., has not granted a license for ASML to sell its most advanced machines such as extreme ultraviolet (EUV) lithography to Chinese semiconductor vendors.

However, ASML still sold non-EUV lithography machines to China. Non-EUV lithography machines form the bulk of the equipment used in semiconductor fabs as most of these facilities are older process nodes.

If sales of this type of equipment become restricted to China, it will likely hinder development of China’s chipmaking industry.

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