China's Commerce Ministry on Tuesday urged the United States to "stop its wrong actions" after U.S. President Donald Trump's administration took action to cut off a Chinese state-backed chipmaker from U.S. suppliers.
He said suppliers such as Applied Materials Inc, Lam Research Corp and KLA-Tencor Corp were likely supplying equipment to Fujian Jinhua. Microchips are also crucial for things like advanced weapons systems and supercomputers, and the administration is anxious that as China's chip-building prowess grows, so too will its military might.
Fujian Jinhua Integrated Circuit Co, a state-backed company in China, is accused of stealing intellectual property from Micron Technology, a rival based in Idaho. Such license applications will be reviewed but with a presumption of denial, the agency said. "The additional production, in light of the likely US -origin technology, threatens the long-term economic viability of USA suppliers of these essential components of US military systems".
China's foreign ministry said it hoped foreign governments would treat Chinese companies "reasonably and fairly".
It said in a statement that Fujian Jinhua "poses a significant risk of becoming involved in activities that are contrary to the national interests of the United States". As a result of the Commerce Department action, a license is now required for all exports, re-exports and transfers of commodities, software and technology, subject to the Export Administration Regulations. The company has now been put on what is known as an Entity List, which will require Jinhua to apply for a license in order to receive USA exports of commodities, software, and technology.
Semiconductors are among China's biggest imports, rivaling oil, and have become a stark reminder of its dependence on USA technology. American authorities lifted the ban in July after ZTE paid a $1 billion fine, agreed to replace its executive team and hired US -selected compliance officers.
U.S. media say American semiconductor maker Micron Technology is suing the Chinese company.
Micron said it will follow the ruling while requesting the Fuzhou Court to reconsider or stay its decision.
In July, a court in Jinhua's home province banned sales of some Micron products, inciting the American firm's outrage.