TSMC has notified the US Department of Commerce about a potential breach of export regulations after Canadian research firm TechInsights discovered that Huawei's latest AI chip, the Ascend 910B, contained components produced by TSMC.
TSMC emphasized that it ceased supplying chips to Huawei in September 2020 following US sanctions and promptly reported the issue to US authorities after receiving a suspicious order resembling the AI processor, according to Reuters and Bloomberg.
The discovery came to light when TechInsights conducted a teardown of Huawei's AI accelerator and identified TSMC's involvement, which raised concerns about how the Chinese tech giant obtained the chips. US export controls have been in effect since 2020, prohibiting companies like TSMC from using US technology to produce semiconductors for Huawei without a special license.
Following these restrictions, Huawei turned to Semiconductor Manufacturing International Corp. (SMIC) for chip production, but as reported by Asia Financial, questions remain over SMIC's ability to meet performance standards at scale.
TSMC, the world's largest contract chipmaker, reported that it had engaged both the customer involved and the US Commerce Department when the order first raised concerns.
"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 to the Financial Times. "In compliance with the regulatory requirements, TSMC has not supplied to Huawei since mid-September 2020," adding that it is cooperating with authorities and is not currently the subject of an investigation.
The US Commerce Department has not disclosed details of any ongoing probe but confirmed that it is aware of reports alleging export control violations. Chinese officials have criticized US restrictions as efforts to curb technological development. "Such measures disrupt global supply chains," the Ministry of Commerce said in response to earlier sanctions targeting Huawei.
Huawei's launch of advanced smartphones and AI chips in 2024 has fueled speculation that the company has discovered ways to bypass sanctions, potentially through intermediaries or shell firms.
US lawmakers remain concerned about the effectiveness of these controls, as Huawei's apparent access to advanced semiconductors threatens the broader goal of limiting China's technological advancements.
If the investigation confirms a violation, TSMC could face significant penalties, including restricted access to US technologies vital for chip production. With TSMC controlling over 90% of the global market for advanced semiconductors, any disruption could have far-reaching implications, as noted by AppleInsider.
TSMC stated that it maintains a "robust and comprehensive export system" to ensure strict regulatory compliance. The chipmaker emphasized that it swiftly addresses any potential issues through internal investigations and proactive communication with customers and regulatory authorities.
The case will likely set a precedent for future regulatory enforcement as tensions between the US and China continue to escalate over semiconductor access and production dominance.
