US pulls TSMC’s waiver for chip supply exports to China

The US has revoked Taiwan Semiconductor Manufacturing Co's authorisation to freely ship essential gear to its main Chinese chip-making base, potentially curtailing its production capabilities at that older-generation facility.

- MACKENZIE HAWKINS HEESU LEE

American officials recently informed TSMC of their decision to end the Taiwanese chipmaker's so-called validated end user, or VEU, status for its Nanjing site. The action mirrors steps the US took to revoke VEU designations for China facilities owned by Samsung Electronics Co and SK Hynix Inc. The ‘waivers are set to expire in about four months.

Washington's move means that TSMC, Samsung and SK Hynix's suppliers will have to apply for individual approvals when they want to ship semiconductor equipment and other gear covered by US export controls to the affected China facilities, instead of the blanket authorisation those suppliers currently have because of the plants’ VEU status.

TSMC's shares slid as much as 1.3% in Taipei, while suppliers including Tokyo Electron Ltd fell about 2%.

“TSMC has received notification from the US government that our VEU authorisation for TSMC Nanjing will be revoked effective Dec 31, 2025,” the company said ina statement. “While we are evaluating the situation and taking appropriate measures, including communicating with the US government, we remain fully committed to ensuring the uninterrupted operation of TSMC Nanjing.”