Taiwanese company suspends R&D efforts with Chinese firm after US ban
Taiwan-based United Microelectronics Corporation (UMC) has temporarily halted its research and development (R&D) activities with Fujian Jinhua Integrated Circuit Company, two days after US authorities slapped the Chinese company with an export ban.
On Monday, October 29, the US Department of Commerce (DoC) enacted the ban against Jinhua, which makes integrated circuits, based on national security concerns.
The Chinese company has nearly completed additional production of dynamic random access memory (DRAM) circuits that probably originate from US technology, the DoC said, adding that this production threatens domestic suppliers of essential components of US military systems.
Now, UMC has suspended R&D ties with its Chinese partner, according to a statement given to Reuters yesterday, October 31, and confirmed to WIPR.
“UMC will follow all government regulations and temporarily hold the R&D activities we are performing for Jinhua until we are cleared to resume by the appropriate authorities,” the Taiwanese company said.
It added that when the company learned of the US government’s actions, it decided to temporarily suspend its activities due to the uncertainty surrounding the situation.
The ban against Jinhua is part of a wider fallout between the US and China and also a dispute between UMC and Jinhua on the one hand, and US-based Micron Technology on the other.
In December 2017, Micron sued the companies at the US District Court for the Northern District of California, claiming that UMC stole Micron’s trade secrets covering DRAM technology and gave them to Jinhua.
In July, Micron reported that the Fuzhou Intermediate People's Court, Fujian Province, China, had granted a preliminary injunction against two Chinese Micron subsidiaries in patent infringement cases filed by UMC and Jinhua. The injunction stopped the manufacture, sale and import of certain DRAM modules in China.
The companies filed the patent infringement claims against Micron in retaliation for criminal indictments brought by Taiwan authorities against UMC and three of its employees, and the civil lawsuit filed in California, the statement added.
The export ban against Jinhua means the company is seen as a threat to US security or foreign policy. A licence will now be required for all exports, but such licence applications will be reviewed with a presumption of denial.
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