US lawmakers warn Apple against using Chinese chips in next iPhone

Several cross-party senators have written to the US' security chief questioning Apple’s decision to use components from a Chinese chipmaker in its next iPhone.

US senators Marco Rubio and Mark Warner, vice chairman and chairman of the US Senate Select Committee on Intelligence, and Chuck Schumer and John Cornyn, sent the letter on Wednesday to the director of National Intelligence, Avril Haines. The letter called on Haines to launch a public analysis and review of Yangtze Memory Technologies Co (YMTC) and the risks it presents to US national security.

Apple acknowledged earlier this month it was reportedly considering procuring NAND memory chips for future iPhones from YMTC, which the letter said is a state-owned company with extensive links to the Chinese Communist Party (CCP) and its armed wing, the People’s Liberation Army (PLA).

The senators said Apple’s decision would introduce significant privacy and security vulnerabilities to the global digital supply chain the tech giant helps shape, especially due to YMTC’s ties to the CCP and concerning PRC-backed entities. They added the decision would affirm and reward the PRC’s disruptive and unfair trade practices, which undermine US companies by creating significant advantages to Chinese firms at the expense of foreign competitors.

“In July 2022, we wrote to Commerce Secretary Gina Raimondo to warn of the threat YMTC poses to US national security and to request that it be added to the Bureau of Industry and Security’s Entity List,” wrote the senators. “We made these arguments based on the company’s central role in CCP efforts to supplant US technological leadership, including through unfair trade practices.”

They underlined YMTC appears to have strong ties to the PRC’s military-civil fusion programme, as shown through its investors and partnerships. Its parent company, Tsinghua Unigroup, allegedly supplies the PRC military.

The senators also highlighted that in April, there were reports that alleged YMTC may have breached the US foreign direct product rule for supplying smartphone and electronics to Huawei.

The letter added policymakers have, for years, conveyed to the US public the importance of a competitive semiconductor industry to US national and economic security. It said a partnership between Apple and YMTC would endanger this critical sector and risk nullifying efforts to support it, jeopardising the health of chipmakers in the US and allied countries and advancing Beijing’s goal of controlling the global semiconductor market.

“Buoyed by a major contract with a leading global equipment vendor such as Apple, YMTC’s success would threaten the 24,000 American jobs that support memory chip production,” said the senators. “More broadly, such a partnership would also threaten the opportunities this market provides for research at US universities and further development of memory chips for civilian and military uses.”

The senators have requested a response from Haines by 1 October, 2022 and asked the director to produce a comprehensive public report on the Chinese company which can be used to inform federal agencies and the public as to the nature and risks associated with YMTC.

IT Pro has contacted Apple for comment.