TSMC could face $1 billion or more fine from US probe, sources say
The Hindu
Taiwan Semiconductor Manufacturing could face a penalty of $1 billion or more, according to two people familiar with the matter.
Taiwan Semiconductor Manufacturing could face a penalty of $1 billion or more to settle a U.S. export control investigation over a chip it made that ended up inside a Huawei AI processor, according to two people familiar with the matter.
The U.S. Department of Commerce has been investigating the world's biggest contract chipmaker's work for China-based Sophgo, the sources said. The design company's TSMC-made chip matched one found in Huawei's high-end Ascend 910B artificial intelligence processor, according to the people, who requested anonymity because they were not authorized to speak publicly about the matter.
Huawei - a company at the center of China's AI chip ambitions that has been accused of sanctions busting and trade secret theft - is on a U.S. trade list that restricts it from receiving goods made with U.S. technology.
TSMC made nearly three million chips in recent years that matched the design ordered by Sophgo and likely ended up with Huawei, according to Lennart Heim, a researcher at RAND's Technology and Security and Policy Center in Arlington, Virginia, who is tracking Chinese developments in AI.
The $1 billion-plus potential penalty comes from export control regulations allowing for a fine of up to twice the value of transactions that violate the rules, the sources said.
Because TSMC's chipmaking equipment includes U.S. technology, the company's Taiwan factories are within reach of U.S. export controls that prevent it from making chips for Huawei, or producing certain advanced chips for any customer in China without a U.S. license.
Heim said that based on the design, which is for AI applications, TSMC should not have made the chip for a company headquartered in China, especially given the risk that it could be diverted to a restricted entity like Huawei.