Gone In 40 Days: US Drops Ban On Export Of Chip Design Tools To China

World War Fee The US has lifted the requirement to secure a license before exporting Electronic Design Automation (EDA) tools to China, say EDA vendors.

EDAs are critical semiconductor chip design, test, and validation tools and the Trump Administration introduced the licensing requirement in May.

Doing so was consistent with US policy to deny China access to the most advanced semiconductor technology, on grounds that China uses it for military purposes and to advance its economic development in ways that make it a more formidable competitor in all fields.

On Wednesday, the Bureau of Industry and Security (BIS) of the US Department of Commerce ended the licensing requirement.

Statements from EDA vendors Synopsys and Siemens EDA both state that the BIS sent them a letter that says export controls on their wares have ended. Another key EDA vendor, Cadence Design Systems, reportedly also received a similar letter.

Siemens said BIS advised it of the ban on May 23rd, and its statement dated July 3rd says the regulator "recently" advised it of the new rule. The licensing requirement therefore lasted fewer than six weeks.

There's no word on why BIS lifted the licensing requirement, although the slightly more congenial tone of recent trade talks between the US and China are an obvious reason for Washington to ease export restrictions.

Whatever the reason for the change, investors appear to have appreciated it as the share price for Cadence and Synopsys rose a few points on Wednesday.

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Also on Wednesday, BIS announced it reached a settlement with California-based company Alpha and Omega Semiconductor (AOS), which makes power management chips used in many electronics – and in 2019 allegedly sold 1,650 of them to Huawei in defiance of US bans.

A BIS Order [PDF] requires AOS to pay a civil penalty of $4.25 million, an outcome the company said "brings to an end the US government's five-year-plus investigation, which resulted in no criminal charges."

The company declared itself "pleased to bring this matter to a close with only limited administrative export control charges." ®