The US government has extended its investigation into Applied Materials for allegedly facilitating the shipment of chip manufacturing tools to China without an export license.
According to a filing with the SEC, Applied Materials confirmed it had received an additional subpoena from the US Commerce Department’s Bureau of Industry, the third to come from that branch of government.
In the filing, the company acknowledged it had also previously received subpoenas from the US Attorney’s Office for the District of Massachusetts in August 2022 and February 2024, and a subpoena from the Securities and Exchange Commission, also in February 2024.
“We are cooperating fully with the government in these matters. These matters are subject to uncertainties, and we cannot predict the outcome,” the company said in its statement.
The investigation relates to claims that Applied Materials bypassed US sanctions by shipping hundreds of millions of dollars worth of semiconductor manufacturing equipment to the partly Chinese state-owned SMIC via a South Korean subsidy.
In 2020, the US Commerce Department added SMIC – China’s largest contract chipmaker – to its sanctions list, requiring companies to seek individual export licenses to sell equipment to the company. A few months later, the company was added to the government’s Entity List, making it even harder for SMIC to obtain US products and services.
No information about when Applied Materials allegedly made the shipment in question has been disclosed.
In September 2023, the US government opened an investigation after it was first discovered the Huawei Mate Pro 60 contained 7nm, 5G-enabled chips produced in China by the partly state-owned SMIC.
When the Department of Commerce started its investigation, at that time, the most advanced chip SMIC had been known to manufacture was a larger-scale 14nm semiconductor.