The Taiwanese government has lifted restrictions that limited domestic chip manufacturers such as TSMC from producing 2nm chips in foreign fabs.
According to a report from Taipei Times, the minister of economic affairs J.W. Kuo told reporters in Taiwan that “those were old rules” and “times have changed.”
He added: “Private businesses should make their own business decisions based on their own technological progress.”
Two months ago, Kuo brushed off any changes to the law, stating: “Although TSMC plans to make 2-nanometer chips [abroad] in the future, its core technology will stay in Taiwan.”
Until now, Taiwanese chipmakers could only produce chips abroad that are at least one generation less advanced than the chips being produced in their domestic fabs. This meant, for example, that TSMC would not have been able to produce 2nm chips abroad until its next generation A-16 chips entered volume production in Taiwan, something which is expected for the latter half of 2026.
The restrictions had been designed to stop advanced semiconductors from being produced in countries such as China.
TSMC has pledged to invest $65 billion to build three chip fabs in Phoenix, Arizona, with production of 2nm chips at the company’s Arizona fab originally slated for 2028. However, it is unclear if this change in law could impact that timeline and bring forward the production of 2nm chips by TSMC in the US.
Taipei Times said that according to Kuo, TSMC would be “cautiously” evaluating its options but would not be pressured by the incoming Trump administration into making any decisions.
Separately this week, US commerce secretary Gina Raimondo told Reuters that TSMC has already started producing 4nm chips for US customers at its Fab 21, in Phoenix, Arizona.
"For the first time ever in our country's history, we are making leading edge four-nanometer chips on American soil, American workers – on par in yield and quality with Taiwan," Raimondo told Reuters.
While TSMC’s US customers have not been publicly announced, it has previously been reported that the Taiwanese chipmaker is producing two Apple products and one for AMD in Arizona, and is in discussions with Nvidia about bringing Blackwell production to the site.
In November 2024, the US government awarded TSMC $6.6 billion in direct funding under the CHIPS and Science Act to support the chipmaker’s $65bn investment in Arizona.
Last week, reported record revenue of $26.3 billion for the October and December period of 2024, up 39 percent year-on-year (YoY) and beating analyst expectations.