GlobalFoundries Faces $500,000 Penalty Over Unauthorized Chip Exports

The U.S. Department of Commerce fined GlobalFoundries $500,000 for exporting chips to a Chinese firm without authorization. The company made 74 shipments worth $17.1 million to a firm on the entity list without the required license. This incident raises concerns about U.S. export policy enforcement.

The U.S. Department of Commerce has levied a $500,000 penalty on GlobalFoundries, the world's third-largest contract chipmaker, for failing to secure authorization before shipping chips to a Chinese company. This company appears on a trade restriction list.

The Department announced on Friday that GlobalFoundries had completed 74 shipments, valued at $17.1 million, to a firm on the entity list, which requires a challenging-to-obtain license that the company did not apply for. Upon inquiry, GlobalFoundries did not immediately provide a comment.

Concerns have risen among lawmakers regarding the enforcement strength of the Commerce Department's export policy, as Washington aims to prevent sensitive technology transfer to China over fears of military strengthening. In parallel events, Democratic Senator Mark Warner criticized the Biden administration for its seemingly lax oversight of Taiwan's TSMC following reports of a chip finding its way to a product by China's Huawei.

(With inputs from agencies.)