Taiwan’s TSMC has already replaced lost Huawei orders: Minister

TSMC stopped taking new Huawei orders on May 18 due to new US regulations

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TSMC logo (AP photo)

TAIPEI (Taiwan News) — Taiwan Semiconductor Manufacturing Co. (TSMC) has offset the business it lost from China's Huawei Technologies Co. Limited with other customers, according to a Taiwanese government minister on Monday (June 22).

Following a May directive by the U.S. Department of Commerce, TSMC was forced to sever its relationship with Huawei, according to Fortune. The U.S. regulations, passed on May 15, prohibit manufacturers from supplying semiconductors to Huawei if U.S. equipment is used at any stage of production, according to Fortune.

Huawei's chip design unit, HiSilicon, uses American software to produce its semiconductors, while elements of TSMC's manufacturing equipment are also made in the U.S., according to Fortune. The Taiwanese firm previously sold chips to HiSilicon, with Huawei accounting for about 15 percent of TSMC's business.

Kung Ming-hsin (龔明鑫), head of Taiwan's economic planning agency the National Development Council, said that Washington was concerned about a certain company, not Taiwan's economic relations with China, Reuters reported. The United States primarily targeted Huawei because it lacked transparency and had too close of a relationship with the Chinese government, Kung added.

"As for TSMC, although their orders no longer have Huawei, they've quickly been filled up, as other people really need them," Reuters cited Kung as saying. TSMC declined to comment, saying it did not comment on its customers.

Last month, TSMC announced that it would be building a US$12 billion semiconductor facility in Arizona. Construction is set to begin in 2021, with chip production slated to start by 2024.