The US government is moving to restrict the sale of chip design software to China, Bloomberg reported, citing sources familiar with the matter.
This development is part of a broader policy evaluation by the US to curb China’s semiconductor industry ambitions.
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The focus is on electronic design automation (EDA) software, with potential implications for companies such as Cadence Design Systems, Synopsys, and Siemens.
The Commerce Department’s Bureau of Industry and Security has reportedly sent letters to some EDA providers, instructing them to halt shipments to Chinese customers.
The policy details are not yet public, and the extent of the restrictions remains unclear, the publication said.
The publication cited an agency spokesperson as saying: “The Commerce Department is reviewing exports of strategic significance to China.
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By GlobalData“In some cases, Commerce has suspended existing export licenses or imposed additional license requirements while the review is pending.”
However, it could result in a significant impact on business operations in China, where Synopsys and Cadence derive 16% and 12% of their revenue, respectively.
The US administration’s approach to limiting China’s semiconductor industry has been escalating, initially targeting equipment for advanced electronic components and gradually broadening the scope.
Software from companies such as Cadence and Synopsys is crucial for designing high-end processors used by firms such as Nvidia and Apple, as well as simpler components for power regulation.
The US has also aimed to prevent the sale of advanced semiconductors to China, with Nvidia being a primary target of export controls.
Nvidia’s chips are essential for training artificial intelligence models.
The Trump administration banned Nvidia from selling its H20 chips to Chinese customers, marking the third round of restrictions since 2022.
US export controls have become a contentious issue in trade negotiations between Washington and Beijing.
Chinese officials argued that US restrictions, along with efforts to discourage allies from using Huawei Technologies’ Ascend chip, contradict recent discussions in Geneva aimed at easing broader trade tensions initiated by President Donald Trump.
