Some U.S. senators have urged the intelligence community to review the risks of a possible deal between Apple and a state-owned Chinese chipmaker, citing threats to privacy and national security.
Sen. Marco Rubio (R-FL) and Sen. Mark Warner (D-VA), Senate Intelligence Committee vice chairman, wrote to Director of National Intelligence Avril Haines following reports that Apple Inc. was considering procuring NAND memory chips from the Yangtze Memory Technologies Co. (YMTC). [letter]
Bloomberg first reported that Apple was testing sample NAND flash memory chips by YMTC and that the companies had been discussing the tie-up for months. [reuters]
In the letter posted on Thursday, the senators said the potential deal would cause “significant privacy and security vulnerabilities” to the global chain, citing YMTC’s ties to the Chinese Communist Party (CCP).
“YMTC also appears to have strong ties to the PRC’s military-civil fusion program, as shown through its investors and partnerships; its parent company, Tsinghua Unigroup, allegedly supplies the PRC military,” they said, using China’s official name, the People’s Republic of China.
The letter says that any decision to partner with YMTC “would affirm and reward the PRC’s distortive and unfair trade practices,” which undermine U.S. companies globally.
“A partnership between Apple and YMTC would endanger this critical sector and risk nullifying efforts to support it, jeopardizing the health of chipmakers in the U.S. and allied countries and advancing Beijing’s goal of controlling the global semiconductor market,” it states.
The lawmakers cited reports alleging that YMTC violated the U.S. foreign direct product restriction by supplying smartphone and electronic components to Huawei, the Chinese telecom equipment group.
They requested Haines to undertake a public analysis and review the risks that the YMTC-Apple partnership would pose to U.S. national and economic security, as well as YMTC’s role in assisting other Chinese firms.
Meanwhile, Apple told the Financial Times that it was “evaluating sourcing from YMTC for NAND chips to be used in some iPhones sold in China,” but that the chips would not be used in phones sold outside of China.
The Epoch Times has reached out to Apple for comments.
If the partnership arrangement goes through, this will be the first time a Chinese company has joined Apple’s roster of suppliers of NAND flash memory, which already includes Samsung Electronics Co., SK Hynix, and Kioxia Holdings Corp. [techgoing]
Apple began exploring new suppliers for memory chips after Japan-based Kioxia Holdings Corp—a key supplier of flash memory chips to Apple—reported a contamination at two of its manufacturing facilities, which it said will result in reduced production. [reuters]
Reuters contributed to this report.