New US rules might complicate Samsung’s work in China

The United States is thinking about new rules that could make it tougher for Samsung, SK Hynix, and TSMC to do business in China. These companies make important computer chips, and the U.S. wants to limit China’s access to them. The plan involves taking away special permissions that let these firms use American tools and technology in their Chinese factories.

Right now, it’s not certain if these changes will happen. A White House official said the U.S. is just preparing in case a trade deal with China falls apart. They hope the agreement will hold, allowing rare earth materials to keep coming from China. The official added that there’s no plan to use this tactic yet, but it’s a backup option if relations with China worsen. If the U.S. goes ahead, it would be harder for Samsung and others to run their factories in China, where they produce chips for many industries.

When news of this plan broke, shares of U.S. companies that supply chip-making equipment dropped. For example, KLA Corp fell 2.4%, Lam Research went down 1.9%, and Applied Materials lost 2%. Meanwhile, Micron, a competitor to Samsung, saw its shares rise by 1.5%. This move is part of a bigger effort by the U.S. to control technology exports to China. It shows how tense things are between the two countries over tech and trade.