TSMC Taiwanese contractor to continue shipments to Chinese smartphone giant Huawei

TSMC says its chips for Huawei do not fall under US demands

HSINCHU, Taiwan/TAIPEI -- The world's largest contract chipmaker has insisted it can continue delivering critical semiconductors to Huawei Technologies without triggering penalties from Washington's crackdown on the use of U.S. technology to supply the Chinese tech giant.

Taiwan Semiconductor Manufacturing Co. became the first of Huawei's major suppliers to define the scale of its exposure to the new U.S. constraints, after taking advice from a leading U.S. law firm, which it declined to name.

TSMC said at a technology symposium on Thursday that while intellectual property and materials used for semiconductor development would be subject to U.S. restrictions on sales to Huawei, chipmaking equipment would not fall under the new rules. As a result, the chips would not breach rules requiring a license for sales to the Chinese company of products containing 25% or more U.S. technology.

The news will give a big boost to Huawei, which has in recent days seen a number of suppliers including U.S. search giant Google, UK-based chip designer Arm Holdings, and Germany's Infineon halt certain deliveries and services for fear of violating the new rules. A number of telecom operators in Europe and Asia have also announced they will not sell Huawei's new smartphones due uncertainty over access to Google's Android operating system.