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A Chinese Chip Firm, Backed by US Interests, Sidesteps Biden’s Restrictions

A Chinese Chip Firm, Backed by US Interests, Sidesteps Biden’s Restrictions

Brite Semiconductor, a Chinese chip designer partly owned by a sanctioned Chinese chipmaker, navigates through US regulations despite its ties to American financial backing and software acquisitions. This intricate relationship highlights the complexities Washington encounters when enforcing rules aimed at obstructing US contributions to China’s semiconductor industry.

Despite being a significant player in servicing six Chinese military suppliers, Brite Semiconductor maintains links to US-based software firms and financial backing from a US venture capital firm associated with Wells Fargo and a Christian university. These ties, uncovered by Reuters, showcase the challenge faced by the Biden administration in curbing technology and investment flows to China’s chip sector effectively.

While Brite’s connections do not explicitly breach US regulations, they exemplify the hurdles Washington confronts in preventing US resources from bolstering China’s military aspirations. The situation indicates that the US might struggle to achieve its objectives unless it widens its focus to encompass numerous companies operating under the radar.

Republican Senator Marco Rubio expressed concern over Brite’s connections to China’s military supply chain, underscoring the inadequacy of the Biden administration’s approach to export controls and investment restrictions.

Experts and analysts also emphasize Brite’s illustration of Beijing’s ability to utilize low-profile entities to bypass US export bans on prominent Chinese firms, exposing the challenges in halting such technological exchanges.

Despite SMIC’s addition to the US entity list, Brite maintains its relationships with top chip design software suppliers Cadence and Synopsys, raising questions about the efficacy of recent US regulations in preventing the flow of technology to Chinese entities involved in advanced chip production.

Additionally, Brite’s financial ties to Norwest Venture Partners and a Christian college in California further complicate regulatory oversight, indicating that existing measures might not impact pre-existing investments.

As Brite navigates an IPO process in Shanghai, questions persist regarding its independence from SMIC, suggesting potential pricing issues related to SMIC’s role as Brite’s primary supplier and part-owner.

Despite these challenges, Brite’s access to US technology and investment remains uninterrupted, prompting calls to reevaluate existing economic policies and adopt more proactive strategies to counter such behaviors.


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