US lawmakers press White House for tougher enforcement of China chip rules

By Stephen Nellis

(Reuters) – Two senior Republican lawmakers in the U.S. House of Representatives on Friday pressed the Biden administration for tougher enforcement of export controls on sending advanced computing chips and the tools to make them to China.

In a letter to National Security Adviser Jake Sullivan, Representatives Michael McCaul and Mike Gallagher, respectively chairmen of the House Foreign Affairs Committee and a select committee on China, said that new advances by China’s top chipmaker show that the a sweeping set of rules rolled out a year ago this month need updating to close what the lawmakers called loopholes.

The letter comes after Huawei Technologies unveiled a new Mate 60 Pro smartphone that contained advanced chips made by China’s Semiconductor Manufacturing International Corp (SMIC) despite U.S. sanctions.

“The October 7 rules and SMIC’s growing capabilities reveal a stagnant, obscured bureaucracy that does not understand China’s industrial policy, does not understand China’s military goals, and does not understand technology at all – and does not have the will to act,” McCaul and Gallagher said in the letter.

The lawmakers urged the Biden administration to update the rules and take immediate action against Huawei and SMIC. They also urged the administration cut off Chinese companies’ access to powerful artificial-intelligence chips accessed through cloud computing services and to start enforcing the administration’s own rules around placing restrictions on Chinese companies that do not allow U.S. officials to verify whether Chinese companies are complying with U.S. export rules.

Reuters reported this week that the Biden administration has warned China it plans to update the rules. Spokespeople for the National Security Council and the Bureau of Industry and Security, the arm of the Commerce Department that oversees export controls, did not immediately respond to a request for comment.

(Reporting by Stephen Nellis in San Francisco; Editing by Matthew Lewis)