TSMC Faces Potentially Billion-Dollar Fine Over Huawei Chip Controversy

Taiwan Semiconductor Manufacturing Co. (TSMC) may incur a $1 billion penalty due to a U.S. investigation into a chip they produced that allegedly ended up in Huawei's AI processor. This development affects U.S.-Taiwan trade relations amid looming U.S. tariffs on Taiwan imports.

Taiwan Semiconductor Manufacturing Co. (TSMC) is facing scrutiny as it potentially faces a fine exceeding $1 billion from the U.S. Department of Commerce. This is part of an export control investigation concerning a chip the company manufactured that ended up in a Huawei AI processor.

The investigation arises from an export control breach, as TSMC's U.S.-technological-infused factories are prohibited from producing chips for Huawei or certain Chinese firms without obtaining necessary licenses.

This inquiry strains U.S.-Taiwan relations, coinciding with trade renegotiations following President Trump's new tariff threats on Taiwan imports. TSMC, however, has pledged to comply with regulations while continuing its substantial investments in the U.S.

(With inputs from agencies.)