SEMI Calls for More Industry Input on Export Controls Under Biden

Electronics industry association SEMI called for industry input on a review of Trump administration export control policies, in a Jan. 25 letter to secretary of commerce nominee Gina Raimondo. The trade group said the prior administration made drastic changes to export control regulations without allowing enough industry input, and said the new administration should formally hear industry concerns.

The association claimed that the Trump administration imposed “broad, ambiguous unilateral controls” on semiconductors that ushered in a host of unintended consequences. “Global customers who are unable to procure U.S.-controlled items will be incentivized to purchase comparable foreign-origin substitutes that are not similarly restricted or simply design out U.S.-origin technology altogether,” the letter said. Unilateral controls are “detrimental to U.S. competitiveness,” reducing the “financial resources U.S. exporters need to perform R&D and maintain our technological competitiveness” and “forcing companies to shift production and R&D outside the U.S.”

SEMI specifically drew attention to the Commerce Department's August expansion of the foreign direct product rule (see 2008170029) and its April and December rules related to Chinese military end-users (see 2004270027 and 2012220027). They were “implemented as final rules with no opportunity for industry comment -- before or since implementation,” the letter said.

“SEMI has consistently maintained that multilateral controls — where items of concern are controlled by all major producing nations — create a level playing field, maximize effectiveness, and minimize harm to U.S. national security and economic competitiveness,” the association said in its letter. “Unilateral U.S. controls over items for which there are comparable non-U.S.-origin items are generally ineffective in supporting national security goals and are likely to erode any technological advantages enjoyed by U.S.-origin items.”

SEMI also called for a swift correction of the “unintended” consequences resulting from the August change to the foreign direct product rule. The rule expanded the scope of controls over certain foreign-made semiconductor production and test equipment and semiconductor devices. The industry group also called on the new administration to reduce the backlog of pending license and classification requests submitted by the semiconductor industry.

“Long delays operate as de facto license denials and create uncertainty that contributes further to the design-out of U.S. technology,” SEMI explained. The Bureau of Industry and Security didn't comment.