The U.S. Department of Commerce's Bureau of Industry and Security (BIS) has fined U.S. semiconductor manufacturing giant GlobalFoundries $500,000 for exporting semiconductor wafers to Chinese companies without BIS permission.
🟦 U.S. Department of Commerce Announces Fines on GlobalFoundries for Unauthorized Exports
The U.S. Department of Commerce’s Bureau of Industry and Security (BIS) announced that it will impose a fine of $ 500,000 (about 76 million yen) on the US company Global Foundries (GF), which manufactures semiconductors. The reason for this fine was the shipment of wafers, which are semiconductor materials, to certain companies in China without permission. The BIS “Entity List” lists specific companies and entities and requires permission to export critical technology and materials to these listed companies. GF shipped 5,697 semiconductor wafers to SJ Semiconductor (SJS) in China, one of the listed companies.
There was no direct deal between GF and SJ Semiconductor. However, GF’s China-based customer had designated SJ Semiconductor as an “OSAT” (outsourcer) to assemble and inspect semiconductors. As a result, semiconductor wafers were eventually shipped to SJ Semiconductor.
🟦 Voluntary reporting of violations and reduced fines: Response to the U.S. Department of Commerce
GF voluntarily reported the violation to the U.S. Department of Commerce after it was discovered. In addition, we took measures to prevent the recurrence of the problem (corrective measures). This response was evaluated, and the originally estimated penalty amount was reduced. The U.S. Department of Commerce’s Office of Export Enforcement (OEE) has urged other companies to do the same, saying that such “voluntary disclosure” and “cooperation with investigations” will greatly contribute to reducing fines.
GF will receive a subsidy of about 1.5 billion dollars (about 226 billion yen) to support the semiconductor industry in the United States based on the CHIPS and Science Act promoted by the Biden administration. This subsidy is aimed at strengthening the U.S. semiconductor industry and improving the autonomy of technology, and it is expected to develop in the future while being evaluated for its response after the violation.
🟦Summary
The U.S. is reassessing the possibility of tightening export controls on China and reducing fines through voluntary disclosure of information by companies. The case of GLOBALFOUNDRIES is an example of the importance of voluntary cooperation and corrective action, which will have an impact on the export control regime of companies in the future.
The fine of 75 million yen is not a small amount, but it can be said that it is relatively small compared to the 226 billion yen subsidy.
