TSMC Faces Potential $1 Billion Fine Over Huawei Chip Allegations

Taiwan Semiconductor Manufacturing Company (TSMC) may face a fine of $1 billion or more as part of a U.S. export control investigation into chips it produced that allegedly ended up in Huawei's AI processors, . The U.S. Department of Commerce is examining TSMC's work for China-based Sophgo, whose chips reportedly matched those found in Huawei's Ascend 910B AI processor.

The investigation centers on whether TSMC violated export control regulations by supplying chips that were ultimately used by Huawei, a company on the U.S. trade list restricting access to goods made with U.S. technology. TSMC has produced nearly three million chips for Sophgo, which are believed to have been diverted to Huawei.

TSMC has stated its commitment to complying with all applicable laws and regulations, including export controls. The company has not supplied Huawei since mid-September 2020 and is cooperating with the U.S. Commerce Department. Despite these efforts, the potential fine could be up to twice the value of the transactions in question, reflecting the severity of the alleged violations.