Trump blocks Chinese purchase of US chipmaker over national security

Enlarge / Treasury Secretary Steven Mnuchin, left, chairs the Committee on Foreign Investment in the United States. Defense Secretary James Mattis, right, serves on the committee, which recommended that Trump block the Lattice deal. (credit: Joint Chiefs of Staff)

President Trump has blocked an investment firm owned by the Chinese government from acquiring Lattice Semiconductor, a maker of field-programmable gate arrays and other programmable logic devices. The decision follows a recommendation by the Committee on Foreign Investment in the United States (CFIUS), a US government body that reviews deals for potential national security problems.

Chinese investors have been plowing money into American technology companies in recent years, and this has raised concerns that Chinese control could undermine American national security. That could happen because Chinese firms gain the knowhow to develop high-end technologies with military applications. Or deals could pose a more direct threat if they enable the Chinese government to infiltrate the supply chain for products purchased by the US government—thereby creating opportunities for surveillance or sabotage.

Lattice, a Portland-based company with around 1,000 employees, argued that the Trump administration had nothing to worry about. Lattice said it outsourced chip manufacturing to other companies, so there wasn't a risk of manufacturing facilities being infiltrated. Lattice also offered to transfer key intellectual property to the US government to ensure that it didn't fall into Chinese hands.

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