TSMC Faces Potential $1 Billion Fine in U.S. Export Control Investigation

The semiconductor giant is under scrutiny for chips allegedly linked to Huawei, while U.S. tariff threats push it to expand investments in American manufacturing.

The U.S. Department of Commerce is investigating TSMC for allegedly supplying chips, via Sophgo, that ended up in Huawei's AI processors, violating export control regulations.
TSMC could face a fine exceeding $1 billion, calculated as up to twice the value of transactions deemed to have violated U.S. rules.
Since late 2024, TSMC has suspended shipments to Sophgo and maintains it has not supplied Huawei directly since September 2020, emphasizing its compliance with U.S. laws.
President Trump has threatened TSMC with tariffs as high as 100% if it does not expand its U.S. manufacturing footprint, prompting the company to announce a $100 billion investment in new American facilities.
This case highlights escalating U.S.-China tensions over technology access and trade, with stricter enforcement of export controls and broader tariff strategies targeting the semiconductor industry.