USA banned Taiwanese company from supplying chips to China for AI developments.

The American authorities demand from Taiwan Semiconductor Manufacturing Co to stop supplying chips to China that are used in applications with artificial intelligence.

This was reported by Reuters, citing sources familiar with the situation.

The US Department of Commerce sent a letter to TSMC with restrictions on the export of certain complex chips intended for China, which are used in artificial intelligence accelerators and graphics processors (GPU).

TSMC discovered one of its chips in a Huawei AI processor, which is under trade restrictions in the USA.

These restrictions will also affect other companies and allow American authorities to check whether other companies are sending chips to Huawei for developments using artificial intelligence.

TSMC has already informed its clients about the suspension of chip supplies at the beginning of next week.

The Department of Commerce declined to comment on this situation, and a TSMC representative stated that their company complies with all norms and regulations, including export restrictions.