GlobalFoundries fined for China trading

EXPORT CONTROLS:
US lawmakers are growing concerned that the US Commerce Department may not aggressively enforce chip restrictions

The United States on Friday fined New York-based GlobalFoundries Inc, the world’s third-largest contract chipmaker, $500,000 for sending unauthorized chips to a subsidiary of blacklisted Chinese chipmaker Semiconductor Manufacturing International Corp (SMIC, 中芯). He announced that he gave

In the statement made by the US Department of Commerce, it was stated that GlobalFoundries sent 74 shipments worth US$ 17.1 million to SMIC’s subsidiary SJ Semiconductor Corp (盛合晶微半導體) without requesting a license.

Both SMIC and SJ Semiconductor were added to the ministry’s trade restriction Entity List in 2020 due to SMIC’s alleged ties to the Chinese military-industrial complex. SMIC has denied wrongdoing.

Photo: Reuters

The ministry said exporting to companies on the list required a difficult license, which GlobalFoundries did not apply for.

“We urge US companies to exercise extreme caution when shipping semiconductor materials to Chinese parties,” U.S. Deputy Assistant Secretary for Export Control Matthew Axelrod said in a statement highlighting GlobalFoundries’ voluntary disclosure of the breach and extensive cooperation with the commerce department.

GlobalFoundries said in a statement that the company regrets the “inadvertent action taken due to a data entry error made prior to asset listing” that resulted in older chips being mistakenly shipped without a license.

“We strive for and believe we have a world-class trade compliance program that sets the standard for the foundry industry,” he added.

As Washington tries to prevent China from acquiring sensitive U.S. technology that could empower China’s People’s Liberation Army, U.S. lawmakers have become increasingly concerned that the commerce department, which oversees export policy, may not aggressively enforce its regulations.

Influential Democratic Senator Mark Warner on Thursday called on US President Joe Biden’s administration to warn Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) after it was revealed that a chip produced by the Taiwanese chipmaker was used in a product made by China’s heavily sanctioned Huawei Technologies. criticized for “lax control”. Co (華為).

GlobalFoundries, which is majority-owned by Abu Dhabi’s sovereign wealth fund Mubadala Investment Co., has received nearly US$1.5 billion from its trading department to build a new semiconductor manufacturing facility in Malta, New York, and expand existing operations there and in the region. It is planned to receive dollars. Burlington, Vermont.

The grant is part of a US program to encourage chipmakers to increase production in the US.