House Select Committee on China Chairman John Moolenaar has written to Commerce Department leadership demanding enforcement of the Foundry Due Diligence Rule, a January 2025 Biden-era export control measure designed to prevent TSMC and other foundries from being used as an unwitting conduit for advanced chips destined for sanctioned Chinese entities. The rule was born after Sophgo, a Huawei front company, ordered TSMC chips that shipped as Ascend 910B AI accelerators—a $500 million diversion that had to be discovered after the fact.
Moolenaar's August 6 letter cites ambiguity created by the Trump administration's May 2025 decision not to enforce the broader AI Diffusion Rule, which the Foundry rule references. Foundries have generally complied with due-diligence checks since January, but the administration's non-enforcement signal has created uncertainty. "That announcement created ambiguity as to whether front-end fabricators like TSMC can export unpackaged advanced dies to non-approved designers located outside of China, without performing the due diligence specified in the Foundry Due Diligence Interim Final Rule," Moolenaar wrote. He asked Commerce to clarify the rule's status or formally restore it.
The letter reflects growing bipartisan concern in Congress—including from Republicans—over the Trump administration's relatively lenient approach to advanced chip exports to China. Republican Senators Jim Banks and Andy Kim, and Republican Rep. Bill Huizenga, have all raised similar objections. Architecturally, the rule requires foundries and OSAT providers exporting 14/16nm-class or more advanced chips to presume they are controlled AI processors unless an exemption applies.