TL;DR
The U.S. has announced tariffs on semiconductors imported from China tied to a probe of Beijing’s push for dominance in legacy (mature-node) chips, but the duties are set at 0% until mid-2027. The administration will raise the tariff rate on June 23, 2027, with the specific level to be announced at least 30 days beforehand.
What happened
A Notice of Action posted by the Office of the United States Trade Representative (signed by General Counsel Jennifer Thornton) follows a probe launched in December 2024 into China’s semiconductor policies. The investigation focused on foundational semiconductors — often called legacy or mature-node chips — including those used as components in critical sectors such as defense, automotive, medical devices, aerospace, telecommunications and power infrastructure. The report concluded that China has pursued non-market measures to build dominance in the sector and that those actions harmed U.S. companies and workers. As a remedy, the USTR determined tariffs on Chinese semiconductors are appropriate, but set the initial rate at 0% until mid-2027. The administration said it will increase the duties on June 23, 2027, and will set the exact rate no fewer than 30 days before that date. U.S. Trade Representative Jamieson Greer argued in a related opinion piece that tariffs can be used to secure investment and boost onshore manufacturing.
Why it matters
- Signals a U.S. strategy that uses trade measures to counter foreign industrial policy in semiconductors.
- Creates a clear timeline for businesses and governments ahead of the tariff rate taking effect in mid-2027.
- Adds leverage to U.S. efforts to attract chip production and investment domestically.
- Introduces potential supply-chain uncertainty for industries that rely on mature-node components (defense, auto, medical and energy).
Key facts
- The investigation was opened by the Biden administration in December 2024.
- The Notice of Action was signed by Jennifer Thornton, General Counsel at the USTR.
- The probe targeted foundational semiconductors (legacy or mature-node chips) and their use in critical downstream industries.
- The report found China used aggressive, non-market policies to pursue dominance in the sector and that U.S. firms were disadvantaged.
- Tariffs are judged appropriate but set at 0% until mid-2027 under the Notice.
- The U.S. will raise the tariffs on June 23, 2027, with the exact rate to be decided and announced at least 30 days beforehand.
- U.S. Trade Representative Jamieson Greer wrote that tariffs can prompt negotiations over investment and onshoring.
- The Notice references broader U.S. industrial policy efforts such as investments stimulated by the CHIPS Act; companies like TSMC, Samsung and Intel have previously announced U.S. investments (as cited in the Notice).
- Public comments by President Trump earlier suggested possible tariffs as high as 25, 50 or 100 percent, but those levels are not part of this announcement.
What to watch next
- Final tariff rate to be announced no fewer than 30 days before June 23, 2027 (confirmed in the source).
- Whether China will respond with retaliatory trade measures or other policy steps (not confirmed in the source).
- If Chinese chipmakers decide to invest in U.S. facilities in response to the window before tariffs take effect (not confirmed in the source).
Quick glossary
- Legacy/mature-node semiconductors: Chips manufactured on older, well-established process technologies used widely in automotive, industrial and other non-leading-edge applications.
- Tariff: A tax imposed by a government on imported goods, typically to protect domestic industry or to respond to unfair trade practices.
- Office of the United States Trade Representative (USTR): The U.S. government agency responsible for developing and coordinating U.S. international trade policy and negotiating with other countries.
- CHIPS Act: U.S. legislation that provides incentives and funding to support domestic semiconductor research, design and manufacturing capacity.
Reader FAQ
When do the tariffs take effect?
Tariffs are set at 0% until mid-2027; the administration will increase them on June 23, 2027.
What tariff rate will be applied after mid-2027?
The specific rate will be decided and announced at least 30 days before June 23, 2027.
Which companies are targeted by the tariffs?
Not confirmed in the source.
Will this immediately raise prices for consumers or manufacturers?
Not confirmed in the source.
PUBLIC SECTOR 18 US punishes China’s ‘dominance’ of legacy chips with zero percent tariffs President Trump previously threatened 100 percent tariffs, administration now plans something else starting in 2027 Simon…
Sources
- US punishes China’s ‘dominance’ of legacy chips with zero percent tariffs
- US punishes China's chip 'dominance' with 0% tariffs
- US delays announcement of China chip tariffs until 2027
- US labels Chinese chips an economic threat, but delays …
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