The Biden administration is reportedly considering intensifying trade restrictions on China by implementing the foreign direct product rule (FDPR) if companies like Tokyo Electron Ltd. and ASML Holding NV continue to provide advanced semiconductor technology to the country. This move comes as the US faces resistance from allies over its chip crackdown on China, with the administration seeking to leverage its relationships with other countries.
The FDPR would allow the US to exert control over foreign-made products that utilize any amount of American technology, giving the country more power in restricting the flow of semiconductor technology to China. By considering this measure, the Biden administration is signaling its determination to protect American technological superiority and prevent China from gaining access to critical components through third-party companies.
This potential escalation in trade restrictions highlights the growing tensions between the US and China over advanced technology, with the Biden administration seeking to rally support from allies to address the threat posed by China’s rapid advancements in semiconductor technology. As the US continues to navigate complex geopolitical dynamics in the tech sector, the use of the FDPR could have significant implications for the global semiconductor industry and the balance of power in the technology landscape.
