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Investing.com -- Taiwan Semiconductor Manufacturing Company (NYSE:TSM) stock declined 3.7% Tuesday following a Bloomberg report that the US government has revoked the chipmaker’s authorization to freely ship essential equipment to its manufacturing facility in China.
The US has reportedly ended TSMC’s validated end user (VEU) status for its Nanjing site, a move that could potentially curtail production capabilities at the older-generation facility. The waiver is set to expire on December 31, 2025, giving the company approximately four months to adjust to the new restrictions.
In a statement, TSMC confirmed receiving notification about the VEU authorization revocation. "While we are evaluating the situation and taking appropriate measures, including communicating with the US government, we remain fully committed to ensuring the uninterrupted operation of TSMC Nanjing," the company said.
The action mirrors similar steps taken by US officials against China facilities owned by Samsung Electronics and SK Hynix. While US officials have indicated they intend to issue licenses needed to keep these facilities operational, the shift from blanket permission to individual approvals introduces uncertainty about wait times for securing these permits.
This development comes as US officials are reportedly working on solutions to ease the bureaucratic burden associated with the license application process, particularly given the significant backlog of existing requests.
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