The move follows a year-long “Section 301” investigation into China’s exports of “legacy” or older-technology chips, originally launched during the Biden administration. In its statement, the U.S. Trade Representative said China’s targeting of the semiconductor sector “is unreasonable and burdens or restricts U.S. commerce and thus is actionable.”
The Chinese Embassy in Washington quickly voiced opposition, warning that politicizing trade and technology issues “to destabilize the global industrial and supply chains will benefit no one and will eventually backfire.” The embassy said China would take “all measures necessary to firmly safeguard our lawful rights and interests.”
While the announcement preserves former President Donald Trump’s ability to impose the tariffs, it also signals a cautious approach amid ongoing tensions with Beijing, particularly over Chinese export restrictions on rare earth metals crucial to global technology manufacturing.
In parallel negotiations, Washington has postponed a rule limiting U.S. tech exports to certain already-blacklisted Chinese companies and has initiated a review that could allow shipments of Nvidia’s second-most powerful AI chips to China—despite concerns from U.S. policymakers about potential military applications.
The broader semiconductor industry is also awaiting the outcome of a separate, larger tariff investigation under the “Section 232” national security statute, which could affect Chinese semiconductors and a wide range of electronics containing them from other countries. U.S. officials have indicated that any tariffs from that review may not be imposed in the near term.
President Biden had already implemented an additional 50% tariff on Chinese semiconductors, effective January 1, 2025, adding further pressure to the trade relationship between the world’s two largest economies.