US, UK Embargo Limit Alibaba And Other Chinese Tech Firm's Access To British Chip Designer Arm

Alibaba Group Holding Limited BABA lost access to some of the most advanced chip designs after British chip designer Arm Ltd gave in to the U.S. and U.K. chip embargo against China.
Softbank Group Corp SFTBF SFTBY owned chipmaker concluded that the countries would not approve the sale of its latest Neoverse V series due to its high performance, the Financial Times reports.
The move impacts Alibaba’s T-Head chip unit and other Chinese groups.
Neoverse V falls under Wassenaar, a multilateral arrangement to stop dual-use technology from being diverted for military use. But Arm would need U.S. and U.K .export licenses to sell the technology.
Arm, headquartered in the U.K. but has significant operations in the U.S., is seen as vulnerable to their embargo against China. Like tech companies worldwide, Chinese companies rely heavily on Arm’s designs to build devices from smartphones to servers.
Alibaba’s T-Head engineer said U.S. sanctions created a two-tier system. Amazon.com Inc AMZN Amazon Web Services used 2021 released Neoverse V for its cutting-edge cloud computing chip.
Brewing tensions between China and the U.S. already compelled some Chinese chip companies to explore an increasingly sophisticated open-source alternative to Arm’s designs called Risc-V.
Over the past year, Arm released several new core designs, including Neoverse N2 and Neoverse V1 and V2, the latter of which are the highest-performance cores to date, with designs characterized as having originated in the U.S.
U.S. and U.K. export controls connected to technologies listed under Wassenaar blocked Chinese companies from purchasing Neoverse V2 and its previous generation, V1.
Arm reportedly worked with Alibaba and other Chinese partners to resolve the chip supply issue while complying with the latest export controls.
Photo: Body Stock and Dragon Claws by Shutterstock