Taiwan’s MediaTek applies for US license to supply Huawei

MediaTek will not be able to supply Huawei with chips after Sept. 14 unless US approves its license application

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MediaTek headquarters in Hsinchu

MediaTek headquarters in Hsinchu (CNA photo)

TAIPEI (Taiwan News) — Taiwanese fabless semiconductor company MediaTek Inc. announced on Friday (Aug. 28) that it had applied to the U.S. government for permission to continue selling chips to China’s Huawei after new U.S. restrictions are scheduled to take effect in mid-September.

“MediaTek reiterates its respect for following relevant orders and rules on global trade, and has already applied for permission with the U.S. side in accordance with the rules,” it said in a statement, according to Reuters. The Taiwanese firm did not provide any further details, CNA reported.

The Trump administration has banned suppliers from selling chips made with U.S. technology to the Chinese company without a special license. On Aug. 17, the U.S. Department of Commerce expanded the curbs on Huawei to include another 38 affiliates to the Entity List.

According to the commerce department, Huawei was using its affiliates to acquire chips through third parties to get around the U.S. restrictions that were set in May. The expanded sanctions on the Huawei affiliates close the potential loopholes.

Under the new restrictions, MediaTek will not be able to supply Huawei with chips after Sept. 14 unless the U.S. approves its license application. MediaTek said the latest curbs were unlikely to affect its short term operations and has not changed its third-quarter sales predictions, which are estimated to come in at between NT$82.5 billion (US$2.8 billion) and NT$87.9 billion, up 22-30 percent from the second quarter, CNA reported.

Huawei previously outsourced the production of its chips to Taiwan Semiconductor Manufacturing Company (TSMC), which uses American equipment to make the chipsets, Reuters reported. TSMC said last month that it had stopped taking new Huawei orders in May and does not plan to ship wafers after Sept. 15.