Republicans Urge Commerce to ‘Push Back’ on Chinese Restrictions Against Micron
The Commerce Department should use the Entity List and potentially its anti-boycott regulations to respond to Beijning’s restrictions on U.S. chip company Micron (see 2305220053 and 2305240002), Reps. Michael McCaul, R-Texas, and Mike Gallagher, R-Wis., said in a June 1 letter to Commerce Secretary Gina Raimondo. The lawmakers said it’s time for the U.S. and its partners to “firmly push back” on China’s “economic coercion, adding that it "can no longer sit on the sidelines as the [People’s Republic of China] selectively targets U.S. and allied entities with the goal of intimidating our businesses and harming our economic security.”
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Commerce can start by adding China’s ChangXin Memory Technologies, which is “widely understood to serve military and surveillance end uses,” to the Entity List and subject it to certain foreign direct product rule restrictions, the lawmakers said. China’s restrictions on Micron “should not deter but should rather invigorate export control actions against PRC companies that may threaten U.S. national security or foreign policy interests."
The agency should also examine whether it can use the Anti-Boycott Act of 2018, which is designed to penalize countries participating in a boycott, including against a U.S. company. “While it appears that the Anti-Boycott Act of 2018 has not been used in cases of PRC economic coercion against a U.S. or foreign company,” the letter said, “it sets forth a useful, guiding principle that the United States should not be fueling adversaries’ restrictive trade policies.”
The lawmakers asked Riamondo to respond by June 15 about whether the agency has “sufficient evidence” to add ChangXin Memory to the Entity List and whether it can use its anti-boycott authorities “to prohibit U.S. and other companies from supporting or furthering the boycott on Micron products in the PRC.” If it can’t use those authorities, the lawmakers asked the agency to identify “what amendments would be needed to use these provisions for economic coercion."
McCaul, chair of the House Foreign Affairs Committee, and Gallagher, chair of the House Select Committee on China, also urged Raimondo to “rally U.S. partners and allies,” including Japan and South Korea, “to defeat this PRC embargo.” Commerce should ensure Japanese and South Korean companies aren’t undercutting Micron “by taking its sales that were lost” in China.
“Permitting South Korean companies such as Samsung and SK Hynix to replace Micron’s market share -- while they at the same time receive specific carve outs from implementing regulations for the CHIPS Act and exemptions from certain export controls to the PRC -- would send a dangerous signal to the PRC government and weaken our close alliance with South Korea,” the letter said.
A Commerce spokesperson didn’t comment.