Donald Trump’s administration is sketching out tougher versions of US semiconductor curbs and pressuring key allies to escalate their restrictions on China’s chip industry, an early indication the new US president plans to expand efforts that began under Joe Biden to limit Beijing’s technological prowess.
Trump officials recently met with their Japanese and Dutch counterparts about restricting Tokyo Electron Ltd. and ASML Holding NV engineers from maintaining semiconductor gear in China, according to people familiar with the matter. The aim, which was also a priority for Biden, is to see key allies match China curbs the US has placed on American chip-gear companies, including Lam Research Corp., KLA Corp. and Applied Materials Inc.
The meetings come in addition to early discussions in Washington about sanctions on specific Chinese companies, other people said. Some Trump officials also aim to further restrict the type of Nvidia Corp. chips that can be exported to China without a license, Bloomberg News has previously reported. They’re also having early conversations about tightening existing curbs on the quantity of AI chips that can be exported globally without a license, said some of the people, who asked not to be identified because the deliberations are private.
Shares in Japanese chip firms fell after Bloomberg News’s report, led by Tokyo Electron’s 4.9% slide. Nvidia shares were little changed in early trading Tuesday.
The broad goal in Washington is to prevent China from further developing a domestic semiconductor industry that could boost its AI and military capabilities — and Trump appears to be picking up where Biden left off. In some areas, that means pursuing agreements with allies that never came to fruition in the prior administration. In others, it means adopting the priorities of the more hawkish members of Biden’s team, who were unable to build internal consensus on their more aggressive policy aims.
A White House representative did not immediately respond to a request for comment. The Dutch foreign trade ministry and Japanese ministry of economy, trade and industry declined to comment.
Despite the US government’s efforts to restrict chips from landing in China, firms in the Asian nation have found other means of gaining access. The latest potential example: Bloomberg News reported last month that US officials were probing whether the Chinese AI startup DeepSeek bought advanced Nvidia chips through third parties in Singapore, circumventing export controls.
It could take months before the talks produce any new US regulations, as Trump makes staffing decisions at key federal agencies. It also remains to be seen whether allies will be more receptive to the new leadership in Washington. The prior administration had reached a handshake agreement with the Hague on limiting gear maintenance in China, but the Dutch demurred after Trump won the election, two senior Biden officials said. Without regular maintenance and servicing, chip-making equipment from ASML and others can quickly lose its ability to meet the rigorous demands of producing semiconductors.
Biden’s team also handed off several other priorities to officials on Trump’s national security council, one of those officials said, and the new team was receptive. One key measure is blocking Chinese memory chipmaker ChangXin Memory Technologies Inc. from buying American technology, a step that Biden officials seriously considered but ultimately did not pursue due to opposition from Japan.
Some officials on Trump’s team also want to intensify restrictions on Semiconductor Manufacturing International Corp., the main chipmaking partner to Chinese telecom giant Huawei Technologies Co. Biden effectively blocked shipments to some SMIC facilities but established a case-by-case review for others, which the officials worry could allow SMIC to purchase tools that are ultimately used at restricted plants. SMIC’s shares closed down 1.45% in Hong Kong.
The new administration is also eyeing curbs on sales of chips that Nvidia designed specifically for China, Bloomberg has reported. Some of Biden’s NSC officials wanted to impose those tighter measures before leaving office, several people said, but then-Commerce Secretary Gina Raimondo declined to pursue them.
Then there’s the so-called AI diffusion rule, imposed in the final week of Biden’s term. The measure divided the world into three tiers of countries and set maximum thresholds for the AI computing power that can be shipped to each. It also established mechanisms for companies to validate the security of their projects and access higher compute limits.
The rule, which will have an impact on data center development everywhere from Southeast Asia to the Middle East, drew harsh rebuke from companies including Nvidia, where Chief Executive Officer Jensen Huang expressed optimism that the Trump administration would opt for a lighter regulatory touch.
The White House is discussing how to streamline and strengthen that framework, according to several people familiar with the conversations, although what that entails is still in flux.
One idea favored by some in the administration would be to reduce the computing power that can be exported without a license. Under the current restrictions, chipmakers only have to notify the government before exporting the equivalent of as many as 1,700 graphic processing units to most countries. Some Trump officials want to reduce that threshold, people familiar with the matter said, which would expand the scope of the license requirement.
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