The Chinese Customs has introduced new rules for determining the country of origin for imported microchips. According to these new rules, the country of origin is considered to be where the silicon wafer was manufactured rather than where it was developed or packaged. This reduces tariffs for Taiwanese manufacturers like TSMC, which previously faced a high tariff of 125% on US products.
Chinese semiconductor producers can now purchase chips from Taiwanese manufacturers without additional costs. Companies from the US such as Intel and Texas Instruments will face protective tariffs when supplying to China.
These changes in global supply chains are due to differing approaches to defining the country of origin: the US focuses on where the final processing of the chip takes place, while China only considers where the wafer was produced.