The outgoing Biden administration is preparing to introduce additional restrictions on semiconductor equipment and artificial intelligence microchip exports to China, according to a Bloomberg report.
However, “people familiar with the matter” said these measures will reportedly be less stringent than earlier proposals.
The rules, which sources said could be unveiled next week, could exclude a number of suppliers previously in the scope of these export controls.
Biden first introduced tech sanctions against China in 2022 with bipartisan support. They are intended to curb China’s access to cutting-edge microchip technology developed by Nvidia Corp, Advanced Micro Devices Inc (NASDAQ:AMD, ETR:AMD) and other major chipmakers.
Chinese tech company Huawei has been particularly targeted by US lawmakers due to its close affiliation with the Chinese government.
One of the more contentious aspects of the export controls is the attempted implementation of the foreign direct product rule (FDPR).
Under the FDPR, non-US companies can find themselves indirectly subject to US export rules if their products use technology or software sourced from the US.
This has had a particularly heavy impact on Dutch group ASML Holding NV (NASDAQ:ASML), which manufactures lithography machines used to make microchips.
The Dutch government has resisted pressure to implement FDPR, but has nonetheless announced expanded export controls which further limited the sale of these devices into the Chinese market.
According to the Bloomberg report, the US will not seek to impose FDPR onto Dutch or Japanese companies.
It would be a partial victory for leading chipmakers like Nvidia and AMD, who have been forced to limit their exposure to the massive Chinese market, although the incoming Trump administration presents another layer of uncertainty.
An escalating trade war between the US and China is a near certainty when Trump takes office, although his stance on tech export controls is unclear.