SHARES in China’s biggest chipmaker plunged yesterday following weekend media reports that the Trump administration has imposed export controls on the company.

In a major blow for China’s advanced tech ambitions, the U.S. Commerce Department reportedly ordered companies to seek permission before selling equipment to Semiconductor Manufacturing International Corp. (SMIC).

Equipment sold to the Chinese company posed an “unacceptable risk” of being diverted to “military end use,” according to a letter sent to major U.S. computer chip firms.

News of the letter, which was first reported Saturday, hit SMIC’s share price in Shanghai yesterday, with the firm’s shares closing down 7 percent to the lowest level since its July debut.

Advanced tech has become one of the many battlefronts that have opened up in the last few years as relations between China and the United States plummet to their lowest levels since diplomatic relations were restarted in 1979.

SMIC is China’s biggest contract manufacturer of chipsets and a key pillar of China’s plans to achieve semiconductor self-reliance.

Analysts say China’s dependence on foreign chips hinders that national goal.

Backed by several State-owned entities, SMIC has made strides at improving China’s chip capabilities but it remains heavily reliant on imported equipment and software.

Under the new rules announced by the U.S. Commerce Department, U.S. companies that want to sell equipment to SMIC will now have to apply for a license. (SD-Agencies)