China Bans Some Chip Sales of Micron, the US Company

Beijing on Sunday told Chinese companies that deal with critical information to stop purchasing products from Micron Technology, the U.S.-based manufacturer of memory chips used in phones, computers and other electronics. Many analysts viewed the move as retaliation for Washington’s efforts to cut off China’s access to high-end chips.

In a statement on its official social media site, the Cyberspace Administration of China said that in a cybersecurity review it had found that the chip maker’s products posed “relatively serious cybersecurity problems.” The problems could “seriously endanger the supply chain of China’s critical information infrastructure” and threaten national security, it said.

China’s action is the latest volley in an economic tit-for-tat between Beijing and Washington that is rearranging the fabric of a sprawling global microchip industry. The decision to bar Micron from selling its chips to key companies could have a ripple effect through China’s supply chains as Micron’s Chinese customers seek to replace the U.S. memory chips with homegrown or Korean versions. South Korean chip makers like Samsung and SK Hynix are Micron’s competitors and already do significant business with China.

Beijing initiated a cybersecurity review of Micron in late March as part of what it called a “normal regulatory measure.” The announcement came after Washington rolled out restrictions in October against China’s semiconductor industry. Micron said at the time that it was “cooperating fully” with the investigation and that its China business was operating as normal.

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