Trump Administration Considers Annual Licenses for Samsung and SK Hynix in China

The Trump administration is taking another step in its effort to curb China’s semiconductor ambitions, this time targeting South Korean giants Samsung and SK Hynix. Their factories in China play a critical role in global supply chains, but under Washington’s new proposal, the companies will need annual licenses for equipment and materials shipments to keep their Chinese plants running.

Annual approvals to replace exemptions Until now, both firms benefited from the Validated End User (VEU) status, which allowed them to supply their Chinese fabs without limits under long-term U.S. consent. That system expires at the end of this year. The new plan would require Samsung and SK Hynix to file detailed yearly applications specifying the exact number of machines, components, and materials. U.S. officials insist the goal is not to halt operations but to prevent factory upgrades that could advance China’s ambitions in semiconductors and artificial intelligence.

Seoul between compromise and concern For South Korea, the situation is highly sensitive. On one hand, officials welcome that Washington isn’t demanding approval for each individual shipment, which would cripple operations. On the other, they warn of extra bureaucracy and the risk of supply disruptions. Analysts note that predicting chip plant needs a year in advance is unrealistic. Any unexpected equipment breakdown could lead to costly downtime if licenses aren’t swiftly updated.

Strategic importance of Chinese fabs Samsung and SK Hynix are the world’s leading producers of DRAM and NAND memory. Their Chinese plants manufacture components that power everything from smartphones to servers and data centers. Analysts estimate these facilities represent a significant share of global memory production — meaning any restrictions could ripple across the entire tech industry. It’s no coincidence that obtaining the original VEU status was hailed as a major diplomatic success for Seoul, easing tensions between Washington and Korean companies fearful of supply interruptions.

Trump vs. China: escalating pressure The latest move comes just days after South Korean President Lee Jae-myung signed a defense and investment pact with Donald Trump — a gesture of alliance that sparked harsh criticism from Beijing. The Trump administration argues that prior exemptions created loopholes undermining U.S. export controls. Washington now wants deeper oversight of what flows into Chinese fabs, with the power to greenlight or block specific shipments.

What’s next? If enacted, the system’s success will hinge on the speed and flexibility of U.S. licensing. Slow approvals could cause expensive production disruptions, adding new uncertainty to already fragile supply chains. Industry leaders warn that the measure could destabilize global chip flows at a time when demand is booming, driven by artificial intelligence and data technologies.

#Samsung , #TRUMP , #GlobalTrade , #Geopolitics , #china

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