GOP lawmakers push Biden administration to restrict sales of chip-making software to China

By Justin Doubleday / April 15, 2021 at 1:46 PM

Two Republican lawmakers are urging the Commerce Department to enact tighter restrictions on the sale of key computer chip design equipment to Chinese companies.

House Foreign Relations Committee Ranking Member Michael McCaul (R-TX) and Sen. Tom Cotton (R-AR), a member of the Senate Armed Services Committee, sent a letter to Commerce Secretary Gina Raimando this week following a recent Washington Post report that American software is helping Chinese companies design chips for supercomputers used to develop hypersonic weapons.

"We write to urge you to designate electronic design automation (EDA) tools as a foundational technology and require a license for all end-users under the ownership, influence, or control of the People's Republic of China (PRC)," they wrote in the April 13 letter. "There is clear evidence that companies linked to the Chinese Communist Party (CCP) military are using this software technology to develop advanced weaponry."

The U.S. companies in question, Cadence Design Systems and Synopsis, are major leading chip design software firms.

Earlier this month, the Biden administration placed the Chinese chip company in the Post story, Phytium, on an export blacklist, along with six other entities. In 2019, the Trump administration also effectively banned the sale of EDA software to HiSilicon, a Huawei subsidiary.

But McCaul and Cotton argue other companies linked to the Chinese government are still able to buy EDA software from U.S. firms, showing "distinct drawbacks of an end-user based approach to export controls when dealing with the CCP."

"It must be presumed that any PRC company that accepts state-directed investments to purchase semiconductor technologies, including EDA software licenses, could easily be coerced or induced to perform the functions for Huawei or the CCP military that HiSilicon had, before it was targeted by U.S. export bans," they wrote.

The letter comes as the Biden administration is conducting a whole-of-government review of supply chains, with a special focus on semiconductors. The administration and some members of Congress also want to pass billions in subsidies to increase the U.S. share of chip production, as they are worried about China's plans to dominate the semiconductor market.