U.S President Joe Biden’s executive order to secure and strengthen America’s supply chains for key products has led South Korean chip-making companies Samsung Electronics Co. and SK hynix Inc. to submit information on their chip businesses to the government by Nov. 8 deadline.
According to reports, the U.S. Department of Commerce in late September had asked major chip companies and automakers to voluntarily share business information to address the global chip crisis after Biden’s orders.
Samsung’s device solutions division’s vice chairman & CEO, Kim Ki-nam mentioned that the company was calmly preparing answers to the request.
While SK hynix CEO Lee Seok-hee also commented that they are internally reviewing the matter and are in close talks with the (South Korean) government.
According to reports, the information request by Washington has immediately created concerns about the possible leak of what chipmakers consider as major trade secrets, as questions also touch upon a wide range of issues, such as investment, inventories, pricing, customers, and sales.
Concerns also are also being raised on how to answer those sensitive questions, whilst complying with filings and information disclosure rules required for publicly traded companies.
Although the U.S. government mentioned that the information sharing is purely voluntary, the South Korean companies are however under pressure to file the information as requested.
According to Reuters, U.S. Commerce Secretary Gina Raimondo has warned if companies did not respond to the request, they would have to find other ways that require the companies to give the government the data.
While a Samsung official commented that there seems no other choice but to comply with the U.S government’s request.
The South Korean Industry Minister Moon Sung-wook is said to be planning a U.S. visit this month to discuss the matter with Raimondo and relay the growing concerns.
Seoul and Washington have recently decided to establish a new director-level dialogue channel for regular discussions on semiconductor issues.
The South Korean Ministry of Trade, Industry, and Energy said on Oct. 26 mentioned that they’ve fully explained the concerns to the U.S., and the two sides agreed to continue close consultations down the road.