Uncle Sam Doesn't Want Samsung, SK Hynix Making Memories In China

The US government already has a lot to say about what products chipmakers can and can't sell in China. This week the Commerce Department moved to make it harder for South Korean memory vendors Samsung and SK Hynix to continue manufacturing in the region.

In a notice [PDF] published in the Federal Register, the Commerce Department announced it had terminated the chipmaker's verified end user (VEU) status. 

The VEU program allows companies vetted by the US government to bypass license requirements and import, transfer, and re-export products normally subject to US license requirements.

Samsung and SK Hynix are two of the largest producers of DRAM and NAND flash memory in the world, and maintain a considerable presence in China. According to South Korean media, Samsung's manufacturing plant in Xian, China, accounts for roughly 40 percent of its NAND flash production. Meanwhile SK Hynix produces about 40 percent of its DRAM at a facility in Wuxi.

These rules had allowed Samsung and SK Hynix to continue operating their Chinese plants without disruption. Intel is also listed in the notice, however its memory manufacturing facilities in the region were sold to SK Hynix this spring.

The companies now have 120 days to obtain the necessary licenses in order to continue furnishing their Chinese plants, chipmaking equipment and other controlled products.

What tribute Samsung or SK Hynix will have to make in order to convince the Trump administration to grant these licenses remains to be seen. For reference, Nvidia and AMD have agreed to a 15 percent tax on H20 and MI308 sales to the Middle Kingdom in order to secure export licenses. The US President is now mulling whether to allow Nvidia to sell more powerful Blackwell-based chips in China.

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This isn't the first time the US has cracked down on Samsung and SK Hynix. Late last year, the Biden administration moved to restrict the sale of advanced high-bandwidth memory (HBM) used in AI accelerators, limiting the two companies ability to do business in China.

The Register reached out to Samsung and SK Hynix for comment; we'll let you know if we hear anything back. ®