TECH

To evade US sanctions China's communist government will buy lithographic readers from Europe and Japan

The concern of US authorities with the ability of Chinese chip makers to obtain the necessary equipment by circumventing sanctions has not yet resulted in their tightening, but the Chinese side is ready to guarantee the growth of the domestic semiconductor industry even at the expense of not the most advanced equipment. The volume of your purchases in Europe and Japan will be increased.

As explained by Business Korea, in the revenue structure of the ASML holding in the Netherlands, which is one of the main suppliers of lithographic readers in the world, China accounts for about 30%, and almost all specialized equipment goes to SMIC, one of the five world's largest contract chip makers. Without access to advanced equipment to handle ultraviolet (EUV) lithography, the flagship Chinese is about to increase purchases of lithographic readers of the DUV generation. The contract with ASML was extended until the end of 2022, and provides conditions to increase the supply of specialized equipment for SMIC's needs, according to sources.

SMIC has been negotiating with ASML to increase the supply of DUV scanners since early 2021, but the Dutch supplier was not sure it would be able to work under the required conditions, fearing the expansion of US sanctions. So far they have not affected the supply of DUV lithography equipment with laser wavelengths from 193 to 254 nm, so SMIC will certainly have the opportunity to acquire more scanners in 2022.

Although EUV scanners are suitable for manufacturing chips using 10 nm and finer technical processes, using DUV scanners they generally produce chips at rates no finer than 30 nm. However, as experts note, the use of specialized equipment and the use of various technological tricks end up enabling the use of DUV equipment to produce products with characteristics close to 10 nm chips. At least TSMC and Samsung take similar approaches.

By 2023, SMIC expects to spend at least $11 billion to expand its production lines using DUV lithography. The company now operates about 1,000 lithographic scanners of the corresponding class. Another SMIC supply channel is Japan, where a Chinese third-party chip maker buys used equipment. 

Image source: TSMC