US Imposes New Rules to Curb Semiconductor Design Software Sales to China

The United States government is escalating its efforts to restrict China’s access to advanced technologies by imposing new export controls on semiconductor design software. This move aims to further undermine China’s capabilities in manufacturing and utilizing advanced AI chips.

Siemens EDA, Cadence Design Systems, and Synopsys, key players in the electronic design automation (EDA) software industry, have all confirmed receiving notices from the U.S. Commerce Department regarding these new export controls on EDA software destined for China.

EDA tools are crucial for designing and validating semiconductor manufacturing processes, testing procedures, and for monitoring chip performance and quality. These tools are extensively used by chip foundries, chipmakers, networking hardware companies, the automotive industry, and various other sectors.

Siemens EDA, a division of German tech conglomerate Siemens, stated that it received a notice from the Commerce Department’s Bureau of Industry and Security (BIS) concerning new export controls on EDA software exports to China and Chinese military end-users.

“Siemens has supported customers in China for more than 150 years and will continue to work with our customers globally to mitigate the impact of these new restrictions while operating in compliance with applicable national export control regimes,” the company affirmed.

Synopsys, a U.S.-based EDA software provider, also acknowledged receiving a similar letter from the BIS. In response, the company has suspended its forecast for the third quarter and the full year of 2025, reflecting the potential impact of these restrictions.

Cadence Design Systems also reported receiving a notice from the BIS, mandating a license for “the export, re-export or in-country transfer of electronic design automation software” to customers located in China.

The Financial Times initially reported the development.

These export restrictions are part of a broader U.S. strategy to impede the progress of Chinese companies in the artificial intelligence domain. However, these measures are increasingly affecting the U.S. chip industry, which has historically enjoyed a substantial market presence in China.

Nvidia, for example, has projected billions in potential revenue losses due to restrictions on the sales of its advanced H20 and Hopper AI chips to Chinese clients. Nvidia and AMD are reportedly exploring the possibility of developing and selling less powerful versions of their AI chips to comply with U.S. regulations while still serving the Chinese market.

The U.S. Commerce Department has not yet issued an official statement regarding the new restrictions.