U.S. Tightens Grip on Tech Exports to China: Licensing Interruptions Cause Market Ripples

The U.S. has mandated that companies cease shipments to China without licensing, revoking some existing licenses. This move targets critical sectors, possibly escalating U.S.-China tensions. Affected items are semiconductors and aviation equipment. The Commerce Department will review licenses individually. China's foreign ministry criticizes the U.S. for disrupting global supply chains.

The United States has intensified restrictions on tech exports to China, requiring companies to obtain specific licenses before shipping goods and revoking some existing permissions, according to sources. This move targets strategic sectors such as semiconductor and aviation equipment and may heighten existing tensions between Washington and Beijing.

Numerous companies, including those supplying electronic design automation (EDA) software, received notifications from the U.S. Department of Commerce about the new restrictions. Notably affected are industry giants Cadence and Synopsys, who are reassessing the impact on their business operations.

Following the announcements, the Chinese foreign ministry condemned the U.S. actions as disruptive to global supply chains, accusing Washington of weaponizing trade issues against China. Meanwhile, market responses were volatile, reflecting investor concerns about the potential consequences on bilateral trade relations.

(With inputs from agencies.)