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posted by martyb on Friday November 02 2018, @07:30PM   Printer-friendly
from the naughty-naughty dept.

U.S. Government Indicts Chinese DRAM Maker JHICC on Industrial Espionage; Bans Exports To Firm

The U.S. Department of Commerce [DoC] this week banned U.S. exports to a China-based maker of DRAM. The DoC believes that Fujian Jinhua Integrated Circuit Company (also known as Fujian or JHICC) not only uses technologies obtained from Micron, but also threatens the latter's long-term economic viability and therefore could also be involved in activities that are contrary to the U.S. national security interests.

In the meantime, the U.S. Department of Justice [DoJ] has also filed an indictment against JHICC, United Microelectronics Corp. (UMC), and several individuals accusing them of corporate espionage and stealing IP from Micron. Between the two, the U.S. authorities essentially sided with claims that Chinese makers of memory have illegally obtained IP and technologies from DRAM makers from the U.S. and potentially other countries.

As a result of DoC actions against JHICC, all U.S.-based (and, actually, non-U.S.-based too) companies will require a special license for all exports, re-exports, and transfers of commodities, software and technology subject to the Export Administration Regulations (EAR). DoC makes no secret that such license applications will be "reviewed with a presumption of denial", so it will be tremendously hard for JHICC to obtain practically everything, including Windows 7 licenses for manufacturing equipment and production tools themselves (ASML has a strong presence in the U.S., whereas Nikon Precision is based in California). Meanwhile, the whole situation is somewhat more complex.

Related: Tsinghua to Build $30 Billion DRAM/NAND Fabrication Plant in Nanjing, China


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  • (Score: 5, Insightful) by RamiK on Friday November 02 2018, @09:38PM (4 children)

    by RamiK (1813) on Friday November 02 2018, @09:38PM (#757091)

    At first, government-controlled Tsinghua Unigroup tried to acquire Micron and get all the technologies and IP it needed to make DRAM and NAND legally. That deal never worked out and it is widely believed that the Committee on Foreign Investment in the United States (CFIUS) would have blocked the deal. Since by 2015 only three major makers of DRAM remained on the planet, and as giants like Samsung as well as SK Hynix could not be purchased, the Chinese government turned to different tactics in a bid to get what they needed.

    That is, the US intervened with a legit, TRIPS protected, technology transfer deal under false "national security" claims to keep China at a technological disadvantage in a free market product: RAM. This is precisely what TRIPS was meant to prevent. So now, China retaliated by similarly violating TRIPS and attempted IP piracy and trade secrets theft... Color me shocked.

    Seriously, there must have been dozens of justifiably reprimandable trade secret thefts led by Chinese nationals against US corporations over the years. Use those to make your arguments. This one... This one isn't it.

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  • (Score: 2) by legont on Saturday November 03 2018, @12:45AM (1 child)

    by legont (4179) on Saturday November 03 2018, @12:45AM (#757144)

    The sad truth is that in truly free trade and protected rights world the US will be a looser. We have laws/agreements designed to our advantage and we violate more.

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    • (Score: 2) by RamiK on Saturday November 03 2018, @09:50AM

      by RamiK (1813) on Saturday November 03 2018, @09:50AM (#757231)

      But that's playing a rigged game that rewards nothing to the winner. Why should the US ruin its populous' quality of life by economically warring against everyone else on the globe for the distinction of being the wealthiest? Once you're a developed nation, that money can't buy you anything worth while you don't already have except the silliest of luxuries. Even the best weapons don't mean squat when the threat of nuclear warfare keeps all those fancy high-tech planes and ships in storage. We understand this when we look at military expenditure since we understand pouring money into nothing of value doesn't make any sense. But that's exactly what the US is doing when its trying to be the best economically.

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  • (Score: 2) by HiThere on Saturday November 03 2018, @04:37PM (1 child)

    by HiThere (866) Subscriber Badge on Saturday November 03 2018, @04:37PM (#757315) Journal

    It's not clear that there were "false 'national security' claims". Keeping at least one local RAM maker seems a legitimate national security goal. Since it's politically impossible to subsidize it enough to keep it viable, then the claim seems valid. That said, the Chinese have exactly the same requirement, so since they were prevented from buying the technology, it's not surprising they went to other methods. Other countries, including the US, have done the same.

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    • (Score: 2) by RamiK on Saturday November 03 2018, @08:31PM

      by RamiK (1813) on Saturday November 03 2018, @08:31PM (#757373)

      It's not clear that there were "false 'national security' claims".

      Foreign trade isn't national security. Unless you need RAM to feed the people, fuel the tanks/planes or arm the troops, there are no national security issues. If you start expanding the definition of national security to non-critical industries, you end up with a police state working under a Juche ideology. And if you think its fine so long as they are profitable, I'll remind you of the F35...

      Keeping at least one local RAM maker seems a legitimate national security goal.

      If you're really going there then keep a small fab like IBM's SUNY Poly NanoFab for research and emergencies. There's plenty of aviation and automotive parts outsources to China that are similarly critical to "national security". What's the big difference?

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