US Next-Generation Semiconductor Export Controls: Minimal Impact on Korean Companies

The Ministry of Trade, Industry and Energy has assessed the impact of the U.S. Department of Commerce’s additional export controls on advanced technologies, such as semiconductors, to be minimal on Korean companies.

The U.S. Department of Commerce’s Bureau of Industry and Security has announced new export controls aimed at blocking the export of technologies to competitors like China. The new controls include requiring a license for exports of 24 technologies, including quantum computing, semiconductor manufacturing, and additive manufacturing, from the United States.

The United States has also created an exception clause that allows countries that enforce the same controls as the United States to export the controlled items without a license. This exception is expected to benefit countries like South Korea, which is a member of the Wassenaar Arrangement.

Although the new controls include gate-all-arounds used to produce Samsung Electronics’ advanced microprocess semiconductors, the U.S. plans to apply the “presumption of approval” principle to license applications from Wassenaar Arrangement member countries, including South Korea. This means that Korean companies are likely to face minimal disruptions in their exports of semiconductor products.

The Ministry of Trade, Industry and Energy stated that the U.S. measure is intended to strengthen control over cutting-edge technologies for national security and foreign policy reasons. The measure aims to prevent cutting-edge technologies from being diverted for military purposes through control cooperation with allies and similar countries.

The foreign trade laws that cannot meet the current licensing exception conditions are expected to be finalized around October. After the finalization, consultations regarding cooperation with the U.S. government on control will be possible.