TSMC could face $1 billion or more fine from U.S. probe, sources say

Taiwan Semiconductor Manufacturing Co. (TSMC) could face a penalty of $1 billion or more to settle a U.S.

export control investigation over a chip it made that ended up inside a Huawei artificial intelligence processor, according to two people familiar with the matter. The U.S.



Department of Commerce has been investigating the world's biggest contract chipmaker's work for China-based Sophgo, the sources said. The design company's TSMC-made chip matched one found in Huawei's high-end Ascend 910B artificial intelligence processor, according to the people, who requested anonymity because they were not authorized to speak publicly about the matter. Huawei — a company at the center of China's AI chip ambitions that has been accused of sanctions busting and trade secret theft — is on a U.

S. trade list that restricts it from receiving goods made with U.S.

technology. TSMC made nearly 3 million chips in recent years that matched the design ordered by Sophgo and likely ended up with Huawei, according to Lennart Heim, a researcher at RAND's Technology and Security and Policy Center in Arlington, Virginia, who is tracking Chinese developments in AI..