It is said that American customers refuse semiconductor products made in China

ETNews reported on September 29 that some US semiconductor customers have expressed their rejection of products from China. According to the report, a South Korean power semiconductor company recently received a request from a US customer to use a "certificate of origin" to prove that its semiconductors were not produced in China and were not manufactured by a Chinese foundry, even if the product was designed by a South Korean fabless company.

In addition, supply conditions have become more stringent, such as the country of origin of semiconductors must be specified in contracts. Another South Korean fabless company that supplies semiconductors to the U.S. market has withdrawn its mass production plan for a Chinese foundry due to concerns about U.S. export restrictions.

A semiconductor industry executive said: "From July to August, the demand from the fabless IC industry for proof of semiconductor origin to exclude products made in China is spreading. It seems that most US customers are trying to avoid various sanctions that may be triggered." Some companies prove the origin by changing their foundry production base in Taiwan, China to "Taiwan" because if "China" is marked, it may block supply to the United States.

The report pointed out that since the intensification of the US-China trade conflict, there has been a need to avoid the certification of origin of Chinese products, but the scope of application is limited, such as requesting only certain parts. However, even for semiconductors at the bottom of the finished product, it is difficult to prove the country of origin.

Sanctions on "Made in China" semiconductors are expected to have a ripple effect on South Korea's fabless and foundry industries. Many South Korean fabless companies choose to use local foundries or foundries in Taiwan, such as TSMC and UMC. Seo-gyu Lee, president of the Korea Fabless Industry Association, said: "This is likely to restructure the foundry supply chain to cope with US customers. This may be an opportunity for South Korean fabless companies that have a low proportion of mass-produced products in China."