US Revokes TSMC’s China Shipment Status—And Shares Plummet
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Topline The U.S. has revoked a waiver allowing Taiwan Semiconductor Manufacturing Company, the world’s largest semiconductor firm by market value, to ship to its China-based facilities freely, the company told Forbes on Tuesday, as TSMC’s shares dropped as much as 2%. The U.S. has previously revoked similar shipping status for Samsung, SK Hynix and Intel. Anadolu via Getty Images Key Facts The U.S. informed TSMC the company’s validated end user (VEU) status would be revoked for its Nanjing, China, production facility by Dec. 31, a company spokesperson told Forbes. Shares of TSMC dropped more than 2% shortly after trading opened Tuesday, though the stock pared back some losses and is down more than 1.6% as of around 11 a.m. EDT. The status is a designation allowing companies to ship goods, including technology, equipment or software, without requiring export licenses for each shipment, according to the Commerce Department, which did not immediately respond to a request for comment. Revoking VEU status for TSMC may interrupt the company’s production: Suppliers to TSMC’s China-based facilities will be required to apply for licenses for each shipment with manufacturing gear, spare parts or chemicals used in the production process. TSMC told Forbes in a statement the company is “evaluating the situation and taking appropriate measures,” including communicating with the U.S. government. Forbes Valuation Morris Chang, TSMC’s founder and chairman until his retirement in 2018, ranks the 782nd-richest person in the world with an estimated net worth of $5.1 billion. Chang held about 125 million shares as of a 2018 filing with the Securities and Exchange Commission, accounting for a roughly 0.5% stake. It’s unclear whether Chang has changed his position, however, as TSMC has not disclosed his stake among other insiders and executives since. Key Background TSMC ranks the world’s ninth-largest company by market capitalization…
