The Office of the United States Trade Representative announced on December 23, 2024, that Ambassador Katherine Tai has initiated a Section 301 investigation into China’s acts, policies, and practices related to targeting of the semiconductor industry for dominance. The investigation, self-initiated under Section 302(b) of the Trade Act of 1974, will initially focus on China’s manufacturing of foundational semiconductors — also called legacy or mature node semiconductors — and on the production of silicon carbide substrates and other wafers used as inputs into semiconductor fabrication. USTR has requested consultations with China in connection with the investigation.
What it means
The investigation targets what USTR describes as China’s use of anticompetitive and non-market means, including setting and pursuing market share targets, to seek dominance in domestic and global semiconductor markets. The initial scope covers foundational semiconductors incorporated as components into downstream products for defense, automotive, medical devices, aerospace, telecommunications, and power generation and the electrical grid. USTR will also assess whether China’s practices on silicon carbide substrates and other fabrication wafers constitute unreasonable or discriminatory acts that burden or restrict U.S. commerce under Section 301(b).
USTR will seek public comments and hold a public hearing as part of the investigation. Ambassador Tai said the investigation “underscores the Biden-Harris Administration’s commitment to standing up for American workers and businesses, increasing the resilience of critical supply chains, and supporting the unparalleled investment being made in this industry.”
Key facts
- Investigating authority: USTR, under Section 301 of the Trade Act of 1974, as amended
- Self-initiation authority: Section 302(b) of the Trade Act of 1974
- Response authority: Section 301(b), covering unreasonable or discriminatory foreign government practices that burden or restrict U.S. commerce
- Initial focus: foundational (legacy/mature node) semiconductors and silicon carbide substrates and other fabrication wafers
- Downstream sectors covered: defense, automotive, medical devices, aerospace, telecommunications, power generation and the electrical grid
- Public comment docket opens: January 6, 2025
- USTR has requested consultations with China
Source: United States Trade Representative news release (ustr.gov)