Outgoing U.S. President Joe Biden has initiated a new trade investigation into Chinese-made legacy semiconductor chips. The probe aims to impose additional tariffs on older chips used in automobiles, telecommunications equipment, and everyday consumer products, according to a Reuters report.
U.S. Trade Representative Katherine Tai stated that the investigation is a response to China’s state-backed efforts to increase chip supplies, which could harm American and other semiconductor manufacturers. The probe seeks to protect domestic producers and maintain a level playing field in the global market.
The Biden administration announced that the investigation will conclude before January 20, when President-elect Donald Trump is set to assume office. This move could expedite Trump’s plans to impose a 60% tariff on Chinese imports.
Biden has already imposed a 50% tariff on Chinese chips, effective January 1, alongside stricter export controls on AI, memory chips, and chip-manufacturing equipment.
Legacy chips, built on technology more than a decade old, are less sophisticated than AI or advanced microprocessors but are widely used in most U.S. products.
Commerce Secretary Gina Raimondo highlighted that two-thirds of U.S. goods rely on Chinese-made legacy chips, and half of American companies are unaware of their chip sources. She also expressed concern over the significant use of these chips in the defense industry.
