US Commerce Department revoked licenses allowing Samsung and SK Hynix to upgrade or expand chip production capacity in China, preventing them from deploying new US-made equipment there. Existing facilities and current equipment retain their licenses, but broken or obsolete machines cannot be replaced with new US-origin tools. Samsung operates legacy-chip fabs in China while concentrating high-end chip production in South Korea and the United States. The license revocations form part of broader US efforts to limit China’s ability to produce modern chips and to shift advanced chip manufacturing away from China. The restrictions create operational and strategic hurdles for Samsung and SK Hynix.
The US is a key partner in the chip segment since it holds several manufacturing licenses for US-made equipment. The US Commerce Department has confirmed that it's revoking Samsung's and SK Hynix's licenses to upgrade or expand production capacity in the country, but it will not revoke the licenses of their current facilities and equipment.
This essentially means that if equipment breaks down, Samsung and SK Hynix won't be able to replace it. The US is trying everything in its power to limit China's ability to produce modern chips and shift chip production away from the country. Unfortunately, for Samsung's chip arm, it's another hurdle to overcome.
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