US Chip Export Control Policy Needs Clarity, Coordination, Experts Say
More than six months into President Donald Trump’s second term, the new administration’s plan for export controls on both semiconductors and chip manufacturing equipment remains unclear, industry officials and a congressional adviser said last week. They all said they hope any new controls are calibrated with allies.
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Saif Khan, a fellow at the Institute for Progress and a senior adviser to the House Select Committee on China, said it’s too early to make predictions about the administration's next moves on chip and chip tooling controls. “I think this is an area we'll have to wait and see,” he said during a webinar hosted by Georgetown’s Center for Security and Emerging Technology.
Khan noted that the Biden administration took an “allied approach” to export controls, although there is still a “lingering issue, I would say, where U.S. controls have been more stringent than controls applied by certain allied governments.” The Bureau of Industry and Security worked for months to convince Japan and the Netherlands to impose more strict controls on chipmaking equipment destined to China, but it didn’t make as much progress as it would have liked (see 2407170040 and 2403270038).
“Ideally, what you would want to have, in order to level the playing field and to make the controls more effective, is to match the controls between all of the supplier governments,” Khan said. “And I think that that is probably going to be a significant focus of discussion.”
He also noted there’s a “big discussion” about “to what degree the administration will partner with allies.” BIS Undersecretary Jeffrey Kessler in March told agency officials he planned to take an “aggressive” and “forceful” approach to convincing allies to adopt similar controls (see 2503280039). Former officials and technology policy experts said that could include use of the foreign direct product rule to capture more chip-related exports shipped to China from other nations (see 2504140055).
The U.S. could use “tools it has available to act in more unilateral ways,” Khan said. “I think that's going to be the big question to watch.”
Dan Kim, chief strategy officer at chip intelligence firm TechInsights and a former chief economist with the Commerce Department, also said he will “make no predictions as to what the administration will do” and urged the Trump administration to soon outline a clear export control strategy.
Although the administration has signaled it wants to impose stringent controls against Beijing, it also announced last week it would be approving exports of Nvidia’s previously restricted advanced H20 chips to China (see 2507150013).
The Trump administration should “further clarify and flesh out their view on export controls, generally across the board,” said Kim, who also worked on the Chips for America program during his time at Commerce. “If the idea from the [H20] announcement … is that we want an American technology stack to be utilized as much as possible everywhere, including in China, how far does that apply? Does that also apply to equipment? Where else does it apply? Or is it specific to the chips?”
Kim said “everyone is sort of waiting to see what kind of clarification the administration could give in terms of its approach and philosophy about AI and technology generally that enables AI.”
Mario Palacios, senior director of government affairs and head of international trade policy for semiconductor company Applied Materials, also said he doesn’t “know what the future of export controls looks like.” He said the U.S. should make sure any new controls don’t hurt American companies’ ability to reinvest profits into domestic research and development, and he urged the administration to work on any new restrictions with trading partners.
“When you're looking at establishing, developing and also implementing export controls on an industry like semiconductors that has a huge global diffusion of providers of software, technology, hardware, etc., you have to work alongside those allies” or other countries that are “providing technically capable, ready, drop-in replacements” for chips or chip tools,” Palacios said. “I think that's what's important and critical.”