US senators Schumer, Warner join calls to blacklist Chinese chipmaker

WASHINGTON (REUTERS) - Top Democrats including Senate majority leader Chuck Schumer have joined an effort to place China's fast-growing chip manufacturer, Yangtze Memory Technologies Company (YMTC), on a United States trade blacklist.

In a letter to US Commerce Secretary Gina Raimondo dated July 28, Mr Schumer and a half-dozen other senators from both parties described the "growing threat" posed by Chinese semiconductor manufacturers like YMTC to national security and US chip companies.

"By failing to add YMTC to the entity list, the US Department of Commerce is allowing the PRC to exploit our technological sector and supply sanctioned parties in China," states the letter, which was seen by Reuters on Monday (Aug 1), referring to China's official name.

US exports to companies placed on the Commerce Department's trade blacklist, formally known as the entity list, are restricted.

Huawei Technologies, a Chinese telecommunications equipment maker, was put on the list in 2019, and the letter said YMTC is supplying it, limiting the effectiveness of the sanctions.

In addition to Mr Schumer, the letter was signed by Democratic Senator Mark Warner, and Republican senators John Cornyn, Marco Rubio, Bill Hagerty, James Risch and Mike Crapo.

Mr Rubio and Mr Hagerty wrote letters earlier saying YMTC should be blacklisted.

A spokesman for the Department of Commerce in Washington confirmed the letter was received and said it would respond.

YMTC did not immediately respond to a request for comment.

YMTC produces Nand flash memory chips, which store data in devices such as smartphones and personal computers and at data centres.

The company, which was formed in 2016, accounts for only about 5 per cent of worldwide Nand production, but that is almost double from a year ago, according to industry research.

"YMTC is an immediate threat," the senators wrote in their letter, saying that in its bid to secure market share, YMTC is set to drive industry-wide margins negative and force non-Chinese memory firms to exit the market or consolidate.

Separately, Reuters reported on Monday that the Biden administration was considering limiting shipments of American chipmaking equipment to memory chip makers in China, including YMTC.

In response, the Commerce Department said the administration is focused on impairing China's efforts to manufacture advanced semiconductors and was updating its approach and seeking to maximise the effectiveness of export controls.

In their letter, the senators asked Ms Raimondo to bring policy deliberations to a rapid conclusion.