China investigates U.S. semiconductors before trade negotiations
China initiated two investigations focused on the US semiconductor industry in advance of scheduled discussions between the two countries regarding trade and various other matters. The Ministry of Commerce announced in a statement on Saturday that it has initiated an anti-dumping investigation concerning specific American-made analog IC chips, products typically offered by Texas Instruments Inc. and Analog Devices Inc. Simultaneously, the ministry initiated an anti-discrimination investigation regarding US actions targeting the Chinese chip sector.
The probes arrive soon after the US included 23 additional China-based companies on its entity list, which enforces restrictions on businesses considered to be “acting contrary to the national security or foreign policy interests of the US.” China’s public rebuke of US trade measures creates a tense backdrop for a multi-day meeting involving senior officials from both nations. US Treasury Secretary Scott Bessent is scheduled to engage in discussions with Chinese Vice Premier He Lifeng in Madrid, focusing on trade, economic, and national security matters. Semiconductors have emerged as a crucial area of contention, with the US restricting China’s access to the most advanced artificial intelligence accelerators and leveraging the licensing of certain less-powerful Nvidia Corp. hardware as a negotiating tool. In response, Chinese officials have voiced their concerns and reservations regarding security risks.
The ongoing uncertainty in negotiations has recently manifested in China’s inaugural application of an anti-circumvention investigation, resulting in the imposition of anti-dumping duties on US optical-fiber imports. That tool is anticipated to assume a more significant role in the future. The analog chips that Beijing is currently exploring facilitate the interaction between digital systems and the real world, managing functions such as wireless signal amplification and power and voltage regulation. They do not necessitate advanced chipmaking, yet are vital in a wide array of applications, including smartphones, electric vehicles, and medical imaging.
“The US has taken a series of prohibitions and restrictions against China in the field of integrated circuits over recent years, including 301 investigations and export control measures,” a commerce ministry spokesperson stated in another statement. “Those protectionist practices are suspected of discrimination against China and are a containment and suppression of China’s development of advanced computing chips and high-tech industries such as artificial intelligence.” Officials at the US Trade Representative, along with spokespeople for Texas Instruments and Analog Devices, did not provide immediate responses to requests for comment. Bessent and He’s discussions will encompass, among other topics, the status of ByteDance Ltd.’s TikTok, a service that President Donald Trump has estimated could hold a value of up to $500 billion for the US. TikTok faces a deadline next week to secure a deal that will allow it to maintain its operations in the US, although this is not the first time such deadlines have been postponed this year. The US Treasury Department has indicated that efforts to combat money laundering will also be on the agenda.
In January, China announced it would investigate claims that the US is dumping lower-end chips and unfairly subsidizing its own chipmakers, representing one of Beijing’s most significant retaliatory actions in response to American technology sanctions. The anti-dumping probe is set to last for approximately one year and may be extended by an additional six months if necessary, while the anti-bias probe typically takes around three months, as stated by the trade regulator.
