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US to indefinitely extend China waiver for South Korean chipmakers -Yonhap

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SEOUL (Reuters) -The U.S. is expected to indefinitely extend a waiver granted to South Korean chipmakers Samsung Electronics and SK Hynix on needing licenses to bring U.S. chip equipment into China, Yonhap news agency reported on Wednesday.

The U.S. Commerce Department has discussed details with the South Korean chipmakers on which equipment could be used in China, said Yonhap, citing unnamed sources, adding that the U.S. would make related announcements as early as this week.

Last year, the chipmakers had received authorisation from the U.S. Commerce Department to supply equipment needed for chip production in China for a year without seeking additional licenses.

The U.S. Department of Commerce will update its “validated end user” list, denoting what entities can receive exports of which technology, to allow Samsung and SK Hynix to keep receiving certain U.S. chipmaking tools.

Once included in the list, there is no need to obtain permission for separate export cases.

Samsung Electronics and SK Hynix declined to comment.

The Department of Commerce had been in discussions with Samsung and SK Hynix to designate equipment that can be brought into their Chinese production lines taking into consideration the companies’ future plans, as equipment upgrades are also needed to enable business in the next few years, Yonhap reported.

Samsung Electronics has NAND flash memory production in Xian, China, whereas SK Hynix has DRAM chip production in Wuxi and NAND Flash production in Dalian, in which both companies have invested billions of dollars.

The companies together control nearly 70% of global DRAM and 50% of NAND flash markets as at end-June, showed data from TrendForce.

($1 = 1,353.6600 won)

(Reporting by Joyce Lee and Heekyong Yang; Editing by Muralikumar Anantharaman)

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