Taiwan Semiconductor Manufacturing Company (TSMC) recently told Chinese media that the US has officially agreed to extend the waiver allowing the company to ship US chip equipment to its factories in China. TSMC also hopes to further receive an indefinite US chip equipment waiver for its chip manufacturing factory in Nanjing, China. South Korean chip giants Samsung Electronics and SK Hynix recently secured indefinite waivers for their factories in Xi'an, Wuxi and Dalian, Kallanish learns. 

TSMC announced: "We have been advised by the [US] Department of Commerce’s Bureau of Industry and Security to apply for Validated End-User (VEU) authorisation, which would serve as a permanent authorisation.”

Obtaining the advanced US chip equipment is essential for technical upgrades and production expansions of these chip firms due to technology barriers. Failure will impact their operations and competitiveness. 

The waiver is for TSMC's 28-nanometer chips, and its Nanjing factory is expanding this kind of capacity to meet demand. Although the 28 nm technology is far behind the cutting-edge, it is a mainstay for its revenue.

This "safer business" seems increasingly important as the company seeks more investment for producing more advanced 3nm and 4nm chips in the US and 6nm chips in Japan. Its US project in Arizona, however, had to be delayed due to various reasons, which put more pressure on TSMC. 

Meanwhile, US support for Intel has also added pressure on TSMC. On 14 October, TSMC's founder Zhang Zhongmou expressed concern about the company's future. He said: "TSMC will face severe challenges in the future. TSMC’s US competitors have a greater advantage, which will intensify the competitive environment for TSMC’s overseas expansion."

Last week, Seoul’s senior presidential secretary for economic affairs Choi Sang-mok announced Samsung and SK Hynix are allowed to ship US semiconductor manufacturing equipment to their China factories indefinitely without separate US approvals.