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WASHINGTON – The United States announced Monday that it would prevent a Chinese technology company from buying US components because of the threat to national security, the latest as of the conflict between the two largest global economies.
The company, Fujian Jinhua Integrated Circuit, semiconductor manufacturer, "presents a significant risk" of participating in activities that could undermine national security, said the Commerce Department.
The decision could paralyze Jinhua, which uses US components for its semiconductors, and follows similar measures taken this year by the Commerce Department to block component sales to ZTE, a Chinese telecom company. ZTE's ban was lifted after President Trump – in response to a request by Chinese President Xi Jinping in May – asked the ministry to ease the penalty. ZTE has agreed to pay a hefty fine, reshape its leadership and submit to US compliance oversight.
But relations between the United States and China have deteriorated since then and the Trump administration is adopting an increasingly harsh line with regard to transactions involving Chinese entities. He is anxious to prevent Chinese ascendancy from becoming an economic and technological power, and has begun to aggressively scrutinize foreign agreements in order to prevent Beijing from gaining access to valuable American intellectual property.
This month, the Treasury Department explained how it would use the new powers that allow the United States to examine a wider range of foreign transactions, including in sensitive sectors such as technology and telecommunications.
"When a foreign company engages in activities contrary to our national security interests, we will take strong action to protect our national security," said Wilbur Ross, Secretary of Commerce. "Placing Jinhua on the list of entities will limit its ability to threaten the supply chain with critical components of our military systems."
Jinhua has been on the radar of the Trump administration for several months. Micron Technology, a computer memory company from Idaho, accused Jinhua last year of intellectual property theft. In July, Micron was not allowed to sell some of its products in China after Jinhua and its Taiwanese partner, United Microelectronics, accused Micron of violating their patents.
Jinhua opens a $ 5.7 billion plant in China's Fujian Province and is increasingly interested in becoming a global player in the memory chip industry.
The United States and China are engaged in a trade war. Mr. Trump has imposed tariffs on Chinese goods worth $ 250 billion and has threatened to hit all imports from China of taxes. China responded with its own tariffs, and the two countries exchanged more and more hot words in recent weeks.
The United States wants China to open up its market to US companies and put an end to its long-standing practice of lobbying US companies to put valuable technology back into the hands of US companies. business in this country. Trump and Xi are scheduled to meet in Argentina next month at the G-20 summit, where they plan to discuss trade, North Korea and other issues.
Although Trump's tariffs have proved unpopular with Republican and Democratic lawmakers, his efforts to stop intellectual property theft have been praised even by his trade skeptics.
"State-run Chinese state-owned companies are lying, cheating and stealing at the request of the government," Florida Republican Senator Marco Rubio said on Twitter on Monday. "Fujian Jinhua must be held responsible for this illegality. It was the right choice today to protect our technical knowledge. "
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