Brite Semiconductor, a Chinese chip designer, is currently at the center of controversy. The company primarily belongs to China’s largest sanctioned chip manufacturer, SMIC. Brite Semiconductor is reportedly acquiring US software and also enjoys financial support from the United States.
Specializing in its field, Brite Semiconductor is said to offer its chip design services to at least six Chinese military suppliers, according to research by Reuters. SMIC, its second-largest shareholder and primary supplier, was added to the US Entity List due to its alleged ties to the Beijing military. This prevents them from receiving some products from US suppliers, revealing serious gaps in the United States’ enforcement of their own regulations.
Despite its relationship with SMIC, Brite Semiconductor maintains close ties to American companies. It boasts funding from a US venture capital company backed by Wells Fargo and a Christian university, and it has ongoing access to sensitive US technology, specifically from software companies Synopsys and Cadence Design. Reuters reported that in their investigations, they found no evidence that Brite’s relationships with US firms violated any regulations.
Essentially, they are not doing anything illegal, and the Biden administration is allowing this to happen. This appears to be a crack in the US’s plan to halt the flow of technology and investments toward Beijing’s chip sector. In October, the US introduced rules to stop some US chip exports and chip-making tools to China, and in August, it announced a ban on new US investments in the sector.
Brite did not respond to requests for comment, while the US Department of Commerce and the White House declined to comment on the matter. Similarly, the Chinese embassy in Washington refused to comment on Brite but accused the US of “blatant economic coercion and intimidation in the technology field.”
No company is currently violating US restrictions. This situation merely highlights the loose ends in the United States’ efforts to prevent China from accessing US technology or investments, particularly those used to boost China’s military ambitions. Reports suggest that the US will struggle to succeed unless it targets many more companies that have slipped past its radar.
Brite is a classic example of how a Chinese-American joint venture can end up channeling valuable semiconductor technology to SMIC and the People’s Liberation Army,” said Martijn Rasser, CEO of Datenna, an open-source intelligence firm based in the Netherlands.
The Chinese company Brite Semiconductor continues to design chips with US software and financial backing.