US lawmakers seek ban on Chinese chip equipment

A bipartisan group of US lawmakers has introduced a bill in the House to prevent CHIPS Act grant recipients from buying Chinese chipmaking equipment for 10 years.

The proposal, announced November 20 by Republican Jay Obernolte and Democrat Zoe Lofgren, would block the purchase of a range of chip manufacturing tools, from advanced lithography machines to wafer processing equipment.

Democratic senator Mark Kelly and Republican Marsha Blackburn plan to introduce a similar bill in the Senate in December.

The CHIPS Act, passed in 2022, allocated US$39 billion to boost US chip manufacturing and has given grants to companies including Intel, TSMC, and Samsung.

The bill also covers equipment from Iran, Russia, and North Korea, with exceptions for tools not available from US or allied manufacturers.

The restrictions apply only to imports into the US and do not affect the overseas operations of grant recipients.

🔗 Source: Reuters

🧠 Food for thought

Implications, context, and why it matters.

US chip tool imports from China are low and a proposed ban signals wider split

A House bill aimed at CHIPS Act grant recipients would formalize current sourcing. Japan plus the Netherlands lead HS 8486 imports (the Harmonized System code for semiconductor manufacturing equipment such as lithography machines plus wafer processing tools) 1.
Existing export controls limit China’s role in US tool supply 1, so the bill codifies practice rather than forcing big shifts.
Photoresists (light-sensitive chemicals used to pattern chips) come from Japan at more than 80 percent 1, yet the reported bill targets equipment, not materials.
Section 301 (a US trade law provision authorizing retaliatory tariffs) imposes 50% duties on Chinese semiconductors as of 2025 2. Reciprocal tariffs exempt semiconductors under HTSUS (Harmonized Tariff Schedule of the United States) headings including 8486 3, which discourages purchases of Chinese equipment.

Non-Chinese equipment suppliers and integrators may win orders from CHIPS Act fabrication plants (fabs)

The CHIPS Program Office (the Commerce Department office running the CHIPS Act incentives) manages $39 billion for fabs and equipment 4, which would create a group of buyers barred from Chinese vendors for a decade if the bill passes.
Vendors can boost visibility by appearing in the U.S. Semiconductor Ecosystem Map 5, a national directory of equipment and materials suppliers used by project planners plus procurement teams.
Section 301 machinery exclusion changes make at least 317 subheadings in HTSUS Chapters 84 plus 85 eligible 2. This gives a clear path to find categories facing Chinese rivals with tariff relief.
China’s share in HS 8486 imports is small 1. Smaller non-Chinese suppliers plus integrators that assemble, install, and service complete tool lines may find room to serve CHIPS-funded projects.