It turns out that TSMC did not voluntarily stopped supply of advanced AI processors, it was told to by the American government.

The US order comes just weeks after TSMC notified that one of its chips had been found in a Huawei AI processor.

TSMC has reportedly notified Chinese customers that shipments of AI-related chips made with 7nm or below processes will be halted. Additionally, any AI chip projects initiated after November 11 must be approved by the US Department of Commerce and other relevant agencies.

The move comes after chips made by Taiwan's largest producer were found in Huawei AI processors at the end of last month.

TSMC halted the shipments from Monday ... a few weeks ago notified the U.S. Commerce Department that one of its chips had been found in a Huawei AI processor.Chinese tech giant Huawei, at the center of the U.S. action, is on a restricted trade list ...

On November 11, 2024, TSMC reportedly suspended its sub-7nm process services to China's AI and GPU chipmakers following the Huawei "chip controversy," triggering widespread industry impacts and potential order transfers.

A wider shipment ban on TSMC-made chips could affect a range of mainland businesses from electric vehicles to smartphones.

China’s semiconductor index surged to nearly a three-year peak on Monday, fueled by expectations that new U.S. export restrictions on Taiwan Semiconductor Manufacturing Co. (TSMC) could expedite China’s push for semiconductor self-sufficiency.