AI chip smugglers exploit trade control loophole to bring banned HBM from South Korea into China

A memory smuggler has detailed how he gets export-controlled HBM chips from South Korea into China using a loophole. According to The Information, the smuggler owns a chip design firm that build cheap, low-performing processors that fall under the U.S. and South Korea’s export controls. They are then paired with expensive HBM from Samsung and SK hynix, that, on their own, are banned for export to China. But because export control rules only look at the performance of the server processor and not at the other components attached to it, this allows the HBM chips attached inside them to slip under the radar and make their way into China.

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