US’ new export controls to have little impact on Korean businesses: ministry

The flags of the US and China on a microcircuit board (Reuters-Yonhap)

The US' new export controls on critical technologies including quantum computing and cutting-edge semiconductor manufacturing will have little impact on South Korean businesses, Korea's Industry Ministry said on Friday.

The US Commerce Department's Bureau of Industry and Security published an interim final rule on Thursday, implementing controls on 24 goods involving critical and emerging technologies including the gate all-around (GAA) chipmaking process, in order to hinder technological advancement by the US' adversaries.

“The US measure aims to prevent advanced technologies from being repurposed for military use through coordinated controls with allies and like-minded nations," the ministry said in the statement.

“Exports from the US to South Korea operate under a presumed approval principle, so the impact of the US export controls will have little impact on Korean companies," it said.

Under the new US regulations, "like-minded" nations and allies are supposed to get approval from the US BIS for trading goods subject to it. For countries that already have their own export controls on advanced technologies, the US established a new Licensed Exception Implemented Export Controls (IEC) for approval exemptions.

Korea cannot independently regulate items beyond those agreed upon within the international export control regime under its Foreign Trade Act, so the country has not been granted an exemption. Japan and the Netherlands were among the countries included on the IEC list.

The Korean government should be able to cooperate with the US government to coordinate control measures when the law revision aimed at expanding the export control items is expected in October, the Industry Ministry explained.

The goods that are subject to the US export curb measures include quantum computers and related equipment, advanced chip manufacturing equipment and the GAA field-effect transistor, the technology that produces or develops high-performance computing chips for supercomputers.

Industry officials here view the chip sector will not be affected by the US regulations, as Samsung Electronics has already established a stable production system that facilitates GAA technology.

The chip giant was the world's first chipmaker to start initial production of the cutting-edge 3-nanometer process node, applying GAA transistor architecture, in June 2022.

The US is ramping up trade curbs to ensure critical technologies are "not used for purposes contrary to US national security or foreign policy," particularly military applications, according to a BIS press release Thursday.

“Today’s action ensures our national export controls keep in step with rapidly evolving technologies and are more effective when we work in concert with international partners,” said Alan Estevez, under secretary for the Bureau of Industry and Security, while announcing the new IFR on Thursday.

“Aligning our controls on quantum and other advanced technologies makes it significantly more difficult for our adversaries to develop and deploy these technologies in ways that threaten our collective security," he said.

By Jo He-rim(herim@heraldcorp.com)