Biden Launches Section 301 Investigation into China's Mature Semiconductor Chips | WPN World People News

The Biden administration has announced the initiation of a Section 301 investigation into China's semiconductor industry, focusing on "traditional" semiconductors and their impact on U.S. businesses. These chips are used in everyday products such as automobiles, washing machines, and telecommunications equipment.

The U.S. Trade Representative (USTR) stated that the investigation targets traditional chips made in China, noting that Beijing is aiming to dominate the semiconductor sector and control critical global raw materials. The USTR emphasized the need to protect U.S. and other global chip manufacturers from the disruptive effects of China's large-scale subsidies. The investigation will focus on traditional, mature chips widely used in the consumer market, excluding advanced artificial intelligence (AI) chips or complex microprocessors.

U.S. Trade Representative Katherine Tai pointed out that China is targeting the semiconductor industry in its effort to achieve global dominance. Chinese companies have rapidly expanded production and are offering lower-priced chips, which could severely harm market competition.

According to reports, Biden's Section 301 investigation was launched just weeks before Donald Trump's inauguration on January 20, 2021, which was seen as paving the way for Trump to impose a 60% tariff on Chinese imports. The Chinese Ministry of Commerce accused the U.S. of initiating the new 301 investigation for political reasons, disrupting the global semiconductor supply chain.

The Biden administration also announced that starting January 1 of the coming year, it will impose a 50% tariff on Chinese semiconductors, while tariffs on Chinese solar panels and polysilicon will also rise to 50%.

The U.S. government will accept public comments on the 301 investigation starting January 6, with a public hearing scheduled for March 11-12. This investigation is being conducted under Section 301 of the Trade Act of 1974. In 2018 and 2019, Trump used this provision to impose tariffs as high as 25% on approximately $370 billion worth of Chinese imports, triggering a nearly three-year trade war. If Trump had initiated an investigation, it would need to be completed within a year.