US Lawmakers Revise MATCH Act Restrictions on Chinese Chipmakers

U.S. lawmakers have revised the MATCH Act to narrow its scope after industry pushback and removed one of the most sweeping provisions that prohibited sales of cryogenic etching tools to chipmakers in the countries of concern (most notably China), reports Reuters.

This provision had raised concerns across the semiconductor equipment industry due to its wide reach and potential impact on global trade. The updated version of the bill eliminates a nationwide restriction on cryogenic etch equipment produced by companies such as Lam Research and Tokyo Electron, according to Reuters, which claims it has seen the revised copy of the document (which does not appear to be available on official websites).

Yet Chinese chipmakers were not allowed to obtain these tools anyway due to existing export controls, which makes the alterations somewhat cosmetic.

Technical Context: Cryogenic Etching Tools

The original draft explicitly included cryogenic etching equipment as a separate type of etching equipment requiring specific export controls. Cryogenic etching tools are designed for high-aspect-ratio, extremely smooth silicon etching, where sidewall roughness must be minimized. Such tools are used primarily in front-end semiconductor fabrication to create high-precision silicon features, such as advanced transistor structures (e.g., FinFET/GAA) and specialized MEMS. In addition, they are also used in R&D environments where ultra-smooth, high-aspect-ratio silicon etching is required.

Existing Export Controls Framework

The current U.S. export controls require an export license to ship tools used to build logic chips on 14nm/16nm-class process technologies that use FinFET transistors, so cryogenic etching tools have been covered by American export rules since 2021. The existing export controls curbed sales of advanced tools to select fabs, potentially allowing Chinese chipmakers to obtain such tools for their outdated fabs.

The MATCH Act proposes to curb shipments of such equipment to actual companies (thus, plugging the loophole that allowed adversaries to circumvent existing rules), so the blanket ban on selling cryogenic etching tools to countries of concern was excessive.

Remaining Restrictions and Industry Impact

Reuters reports that the latest version of the bill upholds restrictions on sales of advanced wafer fabrication equipment by U.S. and foreign companies to certain Chinese semiconductor manufacturers, including ChangXin Memory Technologies (CXMT), Yangtze Memory Technologies (YMTC), and Semiconductor Manufacturing International Corporation (SMIC). The bill also maintains requirements for licenses to service equipment at covered facilities.

However, the updated version no longer applies a blanket presumption that such licenses will be denied, which should ease one of the more contentious elements for ASML and Tokyo Electron.

Industry Response and Market Implications

The revision of the MATCH Act represents a significant shift in the U.S. approach to semiconductor export controls. Industry stakeholders had expressed concerns that the original blanket restrictions would have far-reaching consequences for global semiconductor supply chains and could potentially harm U.S. companies' competitiveness in the international market.

By removing the nationwide restriction on cryogenic etching tools while maintaining targeted restrictions on specific Chinese companies, lawmakers appear to be striking a balance between national security concerns and the practical realities of the global semiconductor industry.

This adjustment may also reflect the recognition that existing export controls already provide substantial barriers to the transfer of advanced semiconductor manufacturing technology to China, making some of the proposed MATCH Act restrictions redundant.

The changes to the MATCH Act underscore the complex interplay between national security, economic competitiveness, and technological advancement in the semiconductor industry. As the global chipmaking landscape continues to evolve, policymakers will likely need to continue refining their approach to export controls to address emerging challenges while minimizing unintended consequences for the industry.