In this article2330-TWSSNHZ your favorite stocksCREATE FREE ACCOUNTIn this photo illustration a Huawei logo is displayed on a smartphone with a Chinese flag in the background.Sopa Images | Lightrocket | Getty ImagesBeijing has banned semiconductor re firm Insights from working with or receiving data from Chinese entities, in a move that could add to the opaqueness of the country's chip industry.
China's Commerce Ministry, citing national security concerns, announced Thursday that Insights was designated an "unreliable entity," which hibits Chinese individuals or organizations from sharing information with the Canadian-based company.
Insights is well known in the global space for its in-depth coverage of Chinese-made chips and was among the first to report breakthroughs by companies Huawei nologies.Beijing's crackdown on Insights came less than a week after the firm revealed that a breakdown of Huawei's artificial intelligence chips found components sourced from outside mainland China.Insights didn't respond to a request for from CNBC outside normal office hours, while Huawei didn't immediately respond to an inquiry Insights' report.
The findings by Insights Huawei's "Ascend" AI chips were consistent with those from other re firms SemiAnalysis, which said that the Chinese company relies on nology from memory chipmakers Samsung Electronics and contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC).
These companies are under U.S. export controls, restricting them from selling their most advanced nologies to Chinese customers. Moreover, Huawei has been on a U.S.
trade blacklist since 2019, barring chip makers that do with the U.S. from working directly with it.
watch now7:1807:18China will come very close to AI self-sufficiency in next 5 years: UBS GWMSquawk Box AsiaIn response, Beijing and its chipmakers have stepped up efforts to build a self-sufficient semiconductor supply chain.
Huawei, one of China's leading players in these efforts, has been alternatives to U.S. chip giant, Nvidia, though Insights' findings may be seen by some as a knock on such efforts.
Despite its minence in China's chip space, few details are disclosed Huawei's chipmaking efforts outside of what third-party re firms uncover.For example, reports have said that Huawei works closely with China's leading chip foundry SMIC — a competitor of TSMC — though both companies have been silent any collaboration since Huawei was placed on the U.S.
trade blacklist.Last year, Insights reportedly found that a Huawei duct contained a chip component from TSMC, triggering questions the effectiveness of U.S. export controls.
The re firm's findings on Huawei's AI chip could further fuel such concerns.Analysts say Chinese chip companies have exploited loopholes in U.S.
restrictions and drawn on stockpiles of imported chips and components before certain restrictions kicked in.