Taiwan Semiconductor Manufacturing Company (TSMC) has suspended the production of advanced AI chips for Chinese companies, according to the Financial Times. The Taiwanese semiconductor chip maker has reportedly informed its customers in China that it will stop producing AI chips for them, specifically models of 7 nanometers and smaller, starting this Monday.
If a Chinese company orders products that fall into that category, they will have to go through an approval process that will likely involve the US government.
The manufacturer’s new policy may be a direct result of Huawei using its chips in AI accelerators without its knowledge. A Canadian research firm called TechInsights informed the company that it discovered the presence of products manufactured by TSMC in Huawei’s hardware.
This was a violation of trade sanctions imposed by the US Commerce Department against Huawei in 2020, which prevented it from obtaining chips made by foreign firms. Most recently, it revoked its licenses that allowed Intel and Qualcomm to make chips for its devices.
TSMC reported TechInsights’ findings to the US Department of Commerce, which is now investigating how this happened. The company denied any working relationship with Huawei and also stopped selling its chips to the client, which it believes was illegally shipping them to the Chinese brand.
The Times’ sources said TSMC decided to completely suspend production of AI chips for the Chinese client, as it wants to show the US government that it is “not working against US interests.”
Its new policy could have a big impact on its Chinese clients’ AI efforts. Baidu, for example, had planned to make hardware for its AI business powered by a range of chips made by TSMC.
Amid signs of stagnation in the economy, the UK is focusing completely on AI. On Monday, British minister Keir Starmer announced a new AI Opportunities Action Plan. At the heart of the initiative are “AI Growth Zones,” which the government plans to set up in non-industrial areas across the country.
In these zones, the Labour government will speed up planning approvals for data centers and provide better access to the national energy grid. Starmer said the UK’s first AI Growth Zone will be set up in Culham, Oxfordshire, home to the country’s Atomic Energy Authority. More zones will be announced in the summer.
At the same time, Starmer’s government plans to increase state-owned computing capacity 20-fold, starting with the “immediate” construction of a new supercomputer that will have “enough AI power to play chess half a million times per second.” As of November 2024, the UK has 14 supercomputers on the TOP500 list, putting it well behind the US and China.