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Taiwan considers export ban to prevent TSMC from manufacturing newest nodes in the U.S.
Monday, December 22, 2025 at 12:47 AM
Taiwan is considering an export ban that would restrict TSMC from manufacturing its most advanced semiconductor process nodes in the United States, aiming to maintain a two-generation technological gap between domestic and foreign production.
Context
Taiwan’s Ministry of Economic Affairs is reinforcing a strict export control policy that requires TSMC to keep its most advanced manufacturing processes within Taiwan. Under existing regulations, the company is mandated to maintain at least a "two-generation gap" between its domestic production and overseas facilities. This ensures that as TSMC moves toward 2nm mass production in Taiwan by 2025, its $65 billion investment in Arizona will be restricted to slightly older 3nm or 4nm nodes for the foreseeable future.
This policy functions as a strategic "Silicon Shield," maintaining Taiwan’s central role in the global supply chain. For investors, this restriction may complicate the long-term roadmap for U.S. tech giants like Apple, Nvidia, and AMD who seek domestic sourcing of cutting-edge AI silicon. While the U.S. has committed significant subsidies through the CHIPS Act, Taiwan’s latest stance reaffirms that the highest-tier semiconductor technology will remain geographically concentrated in East Asia.
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