Last year, TSMC was essentially forced by the American side to reject further orders from Huawei, which was cut off from modern production capacity. And it can be said that even if TSMC could suddenly produce for Huawei, it would be difficult for it to offer previously banned capacities in the foreseeable future, as these have long been dismantled by others and, given their general shortage, would be difficult to say goodbye to. But Huawei can at least look for a way to recover financially, and the new legislation of the Chinese Ministry of Commerce, which aims to protect domestic companies, gives some hope.
It is this regulation that is generally seen as a counterattack aimed at the United States’ efforts to block Chinese companies such as Huawei or SMIC and others. The purpose is simple, and that is to enable companies to be penalized that succumb to American pressure and stop trading with Chinese companies, as is the case with TSMC.
In the regulation, we will read on the one hand about ensuring national security, which must not be threatened by actions of foreign governments or companies aimed at the rights and interests of Chinese citizens or organizations. The whole thing is directed precisely against such companies, which will succumb to the given actions and cause losses to Chinese companies, and the company TSMC clearly belongs to this. It is also conceivable that it was her relationship with Huawei that irritated China the most, for both business and political reasons.
Under the same rule, Chinese companies can sue companies like TSMC and claim compensation for the losses they have caused. The Ministry of Commerce can then order such companies to provide financial compensation and then immediately re-establish broken business relationships.
Now the question is whether and how Huawei will use this regulation, which is still being speculated about, so we have to wait for further news.
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