Biden’s Section 301 Investigation Could Hit China’s Chip Exports Hard

The Biden administration is preparing to investigate unfair trade practices related to legacy semiconductors (general-purpose chips) from China.

On Tuesday, Bloomberg reported that the Office of the United States Trade Representative (USTR) has decided to investigate Chinese general-purpose semiconductors under Section 301 of the Trade Act as early as next week. This probe could lead to tariffs or other measures restricting imports of older-generation chips and products containing them, including medical devices, automobiles, smartphones, and weapons.

Section 301 investigations are designed to address trade practices deemed unfair or unreasonable. The findings of this inquiry and any subsequent actions are expected to continue into the early days of the incoming Trump administration, which takes office next month.

President Joe Biden has been aggressively curtailing the flow of cutting-edge U.S. technology to China. Earlier this year, he signed the CHIPS Act, a landmark bill providing billions of dollars in subsidies to incentivize semiconductor manufacturers to build factories in the United States. The goal is to reduce reliance on Chinese-made chips while bolstering domestic production capabilities.