U.S. Revokes Key Authorizations for Samsung, SK Hynix in China, Tightens Grip on Global Chip War

President Donald Trump’s administration has escalated its technology confrontation with China by revoking authorizations that allowed South Korean chip giants Samsung Electronics and SK Hynix to use American semiconductor equipment in their Chinese plants.

The move, disclosed in the Federal Register, marks a sharp turn in Washington’s efforts to ensure that its allies’ chip production in China cannot advance beyond current levels.

Intel, which sold its Dalian memory chip plant earlier this year, was also named in the filing.

The revocations will take effect in 120 days. After that deadline, Samsung, SK Hynix, and others will need to secure new licenses to obtain American chipmaking tools for their Chinese operations. The Commerce Department said it intends to approve licenses that allow the firms to keep existing facilities running, but emphasized it will not authorize any expansion or technology upgrades.

“This move will make it harder for Korean chipmakers with facilities in China to continue producing more advanced chips,” said Chris Miller, author of Chip War.

Korea Pushes Back, But U.S. Sets Boundaries

SK Hynix said it “will maintain close communication with both Korean and the U.S. governments and take necessary measures to minimize the impact on our business.” Samsung declined to comment.

South Korea’s government has appealed to Washington, stressing that its companies’ Chinese operations are essential to the global semiconductor supply chain. The Ministry of Trade, Industry, and Energy vowed to “continue discussions with the U.S. to minimize the impact on South Korean companies.”

Yet Washington is signaling it will not bend on its core objective: keeping China from advancing technologically through access to U.S. chipmaking machinery.

U.S. Suppliers Hit as Well

The licensing change will ripple back to American equipment suppliers such as KLA Corp, Lam Research, and Applied Materials, which collectively generate billions in annual sales from Chinese fabs. Shares of Lam fell 4.4%, Applied Materials dropped 2.9% and KLA lost 2.8% after the filing.

In June, a White House official described the possibility of revoking the authorizations as “laying the groundwork” in case trade talks with China broke down. Although Trump and South Korean President Lee Jae Myung announced a tariff truce in July, they left key details unresolved. That truce currently caps U.S. tariffs on Chinese goods at 30% and Chinese tariffs on American imports at 10% until November.

Winners and Losers in the Chip War

Analysts say the licensing revocations may unintentionally strengthen Chinese domestic equipment makers, who could step in to fill supply gaps for Samsung and SK Hynix. The move may also benefit Micron, a U.S. memory chip competitor, by weakening Korean firms’ ability to expand production in China.

“If this isn’t accompanied by further steps against Chinese chipmakers like YMTC and CXMT, it risks opening market space for Chinese firms at the expense of the Korean firms,” Miller said.

Thousands of license applications by U.S. suppliers remain uncertain, creating what industry officials describe as a paralyzing backlog. The Commerce Department is also moving to strip Samsung and SK Hynix of their “Validated End User” (VEU) status, which currently allows faster, license-free shipments of U.S. technology. Removal of that status will slow the pipeline of crucial chipmaking tools into China.

A Pattern of U.S. Tech Protectionism

The clampdown on Samsung and SK Hynix fits into a broader pattern of Washington using trade tools, export restrictions, and tariffs to maintain a technological edge over China. Trump has already sought to wall off U.S. advances in areas like artificial intelligence, quantum computing, and biotechnology from Chinese firms, while urging allies in Europe and Asia to align with American policy.

This approach mirrors the administration’s tariff strategy — recently thrown into legal jeopardy after a federal appeals court struck down Trump’s sweeping “reciprocal tariffs” as unconstitutional. While Trump plans to appeal that ruling to the Supreme Court, his administration has pivoted aggressively toward sector-specific measures, especially in strategic industries like steel, aluminum, and semiconductors, that courts are less likely to strike down.

The latest restrictions are likely to deepen frictions with allies like South Korea, who rely on China as both a production base and a massive consumer market. They also come as Europe intensifies its regulatory scrutiny of U.S. tech giants and signals willingness to retaliate against Washington’s trade measures.

The Biden administration carried forward many of Trump’s first-term chip restrictions, but the latest escalation shows Trump is doubling down on his strategy of using trade law and export controls not only to squeeze China but to protect U.S. companies from foreign competition — even when the foreign firms are close allies.