The U.S. Government is preparing new regulations that could ban the use of memory chips – specifically DRAM and NAND flash – produced by Chinese companies, citing potential national security risks associated with technology components from China. The move signals escalating tensions between the two countries in the critical semiconductor sector, a key driver of the global economy.
The proposed rules would apply to devices and services purchased by U.S. Federal government agencies. If enacted, products utilizing memory chips from Chinese firms would be prohibited in U.S. Government technology procurements.
According to a report from Wccftech, the proposal targets three major Chinese semiconductor manufacturers: ChangXin Memory Technologies (CXMT), Yangtze Memory Technologies Corp (YMTC) and Semiconductor Manufacturing International Corporation (SMIC), along with their affiliates. Memory chips from these companies could be added to a list of prohibited components.
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The plan, issued by the Federal Acquisition Regulatory Council (FAR Council) on February 17, 2026, implements Section 5949 of the National Defense Authorization Act for Fiscal Year 2023 (FY23 NDAA).
The proposal broadly defines “covered semiconductor product or service” to include not only the chips themselves, but likewise any device containing them – encompassing laptops, servers, networking equipment, and even information and telecommunications technology services.
This means that any government device utilizing RAM or SSDs from companies on the prohibited list would be ineligible for U.S. Government procurement.
Notably, the rules would extend to all types of procurements, including commercial products valued under USD 15,000. The government would also require contractors to conduct thorough supply chain due diligence to ensure no prohibited Chinese components are included.
The proposal is currently undergoing a public comment period, with the FAR Council accepting feedback until April 20, 2026, before finalizing the rule.
If no significant changes are made, the regulations are scheduled to capture effect on December 23, 2027.
The government is also providing a grandfathering clause, allowing devices or equipment already purchased or installed before the effective date to remain in use until the end of their lifespan.
the FAR Council has proposed a review of all electronic devices currently used by U.S. Government agencies to ensure they do not contain components from companies on the prohibited list.
While the rules officially apply only to U.S. Government procurement, analysts anticipate a broader impact on the commercial market.
Laptop, server, and electronics manufacturers typically prefer to avoid creating separate product versions – one for the U.S. Government and one for the general market. Many vendors may choose to avoid components from CXMT or YMTC altogether to streamline their supply chains.
Should this scenario unfold, the U.S. Action could hinder the ambitions of Chinese memory companies to expand their global market penetration, particularly in North America.
Conversely, the policy is expected to benefit major memory producers such as Samsung, SK Hynix, and Micron, which currently dominate the high-end memory chip segment.
The restrictions could also contribute to increased volatility in global RAM and SSD prices, particularly if memory supply remains constrained due to strong demand from the artificial intelligence and data center industries.
(afr/afr)
