The U.S. government has taken another step in its strategy to curb China’s technological progress, this time targeting South Korea’s semiconductor giants Samsung and SK Hynix.
According to the Federal Register published on Friday, Washington has revoked the special waivers that previously allowed these companies to purchase American-made semiconductor production equipment for use in their plants in China. From now on, such acquisitions will require a licensing process, which will take effect within 120 days. Intel was also named in the announcement, though the impact will be minimal since the company sold its related production division in China earlier this year.
The U.S. Department of Commerce clarified that existing factories will still be allowed to operate under a license framework, but made it clear that no approvals will be granted for capacity expansions or technological upgrades at the Chinese facilities of the affected firms. In essence, Washington is placing a direct cap on the growth and modernization of advanced chip production in China.
The announcement triggered immediate reactions in the financial markets. Shares of key U.S. semiconductor equipment suppliers — Lam Research, Applied Materials, and KLA — fell between 2.4% and 4% following the news, reflecting investor uncertainty around the new regulatory environment. Samsung and SK Hynix, for their part, declined to issue official statements in the immediate aftermath.
These new restrictions form part of the broader set of export controls that Washington has been enforcing since 2022 to block China’s access to critical semiconductor technologies. Until now, Samsung and SK Hynix had benefited from exemptions, largely due to their global importance and the delicate diplomatic balance between Seoul and Washington.
The removal of this privilege marks a significant shift, underscoring the U.S. administration’s determination to shut down all potential avenues for China to obtain advanced chip-making capabilities. Analysts note that the main beneficiaries of this move could be Chinese equipment suppliers, who may now step in to fill the gap, as well as U.S. memory chipmaker Micron, a direct competitor to Samsung and SK Hynix in the global market.
At the same time, the decision risks adding strain to U.S.-South Korea relations, particularly as Seoul plays a crucial role as a strategic ally in Asia amid Beijing’s growing influence. Ultimately, Washington’s move not only disrupts the expansion plans of South Korean chipmakers in China but also reshapes the geopolitical landscape of the semiconductor industry — an arena where competition is no longer measured solely in innovation but also in global power and influence.
