TSMC Chips Ended Up in Devices Made by China’s Huawei Despite U.S. Controls

The U.S. government has spent years weaving a web of controls to prevent Chinese companies from being able to buy or make cutting edge computer chips.

But several weeks ago, the maker of the world’s most advanced chips, Taiwan Semiconductor Manufacturing Company, learned that some of its chips had ended up in devices made by Huawei, a Chinese telecommunications giant under U.S. sanctions, according to two Taiwanese government officials who were not authorized to speak publicly.

TSMC, which manufactures chips for tech giants like Apple and Nvidia, said that it had not supplied chips to Huawei since those restrictions went into effect. But TSMC continues to supply other major companies in China, and concerns have been growing among U.S. officials that other companies could be routing products to Huawei.

The U.S. government has tried to keep advanced chips out of the hands of Chinese companies over concerns they could be used for military purposes. It has blocked Huawei and other Chinese firms from buying products made with American technology and pushed companies in allied countries including Japan and the Netherlands to stop selling to them.

Still, chips used in artificial intelligence are actively traded in markets in China, despite U.S. restrictions, and Chinese companies have continued to develop the kind of technology that the American authorities are concerned about. They have made strides in artificial intelligence systems and the advanced microchips that power them.

This progress, along with the presence of TSMC-made chips in Huawei devices, raises questions about how successful the U.S. controls have been at keeping advanced technology out of China, as well as how companies like TSMC vet their customers.