Intel will be banned from building fabs in China for a decade if it accepts any CHIPS Act cash. Which it absolutely will.

The US puts an end to any plans Intel may have to make more chips in China

(Image credit: Intel)

The US is banning some major US chipmaking companies from building “advanced technology facilities” in China, the Biden administration has announced (opens in new tab).

The ban will apply to any company that receives funding as a part of the CHIPS and Science Act, which was approved by the US Congress in August (opens in new tab). This act aims to increase domestic manufacturing of semiconductors with an influx of $50B in cash into companies that apply. More than half of those funds are headed to cutting-edge facilities for today’s top chips, though a smaller amount will help to ease demand for older chips and into research. 

Generally, it’s about shifting what is currently a very Asia-focused manufacturing hub slightly more westward. Though banning any company from exploring options in China is certainly one other way of going about that.

One major company known to PC gamers everywhere and set to take a large sum of cash from the CHIPS Act is Intel. The company’s CEO Pat Gelsinger was fiercely campaigning for the act and Intel is set to be one of the largest beneficiaries of it, considering the company’s massive domestic and international chip manufacturing facilities. One of which is in Dalian, China, in fact, known as Fab 68.

Though only one of many fabs owned and operated by Intel globally, Fab 68 was very recently in line for a significant expansion—a move reportedly discouraged by the White House (opens in new tab). Now it seems the White House may have found an even stronger way to keep Intel’s investment out of China, with this recent proviso for receiving CHIPS Act funds effectively putting an end to that plan or anything like it.

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The US puts an end to any plans Intel may have to make more chips in China

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Memory manufacturer Micron may also have to side-line any further plans in China if it hopes to net a lump sum from the US government. It runs an assembly and test facility in Xi’an China, first opened in 2007. Though the US government has specified that any facility building older chips can be operated in the area to serve the local region (opens in new tab).

Both Intel and Micron have plans to expand their US-based operations, however, and Intel is also building and expanding in the EU (opens in new tab).

This ban won’t necessarily affect companies such as Nvidia or AMD directly, as they rely on third parties to build their chips for them. However, neither has managed to dodge the eye of the US government entirely: both has been told to stop sending high-end datacentre GPUs to China (opens in new tab) and Russia.

The US puts an end to any plans Intel may have to make more chips in China

Jacob Ridley

Senior Hardware Editor

Jacob earned his first byline writing for his own tech blog from his hometown in Wales in 2017. From there, he graduated to professionally breaking things as hardware writer at PCGamesN, where he would later win command of the kit cupboard as hardware editor. Nowadays, as senior hardware editor at PC Gamer, he spends his days reporting on the latest developments in the technology and gaming industry. When he’s not writing about GPUs and CPUs, however, you’ll find him trying to get as far away from the modern world as possible by wild camping.

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