Taiwan plans to add AI servers and cutting-edge semiconductors to its controlled-items list, making unauthorised shipments of restricted AI hardware to China a criminal offence under the Foreign Trade Act, Economic Affairs Minister Kung Ming-hsin said in an interview on 12 October. Bloomberg reported the plan on 16 October 2026. Kung declined to say when the government would implement the measures.
Key points
- Taiwan plans controls on AI servers and cutting-edge semiconductors, with criminal penalties for unauthorised shipments of restricted hardware to China.
- Kung said some controlled-item measures would correspond to American ones under the Agreement on Reciprocal Trade.
- Startup Fortune reports that the proposed approach would cover all Chinese buyers rather than only companies named on Taiwan’s existing list.
- Kung gave no implementation date.
The Foreign Trade Act would supply a direct charge
Taiwan does not currently treat unauthorised AI chip exports to China as a crime under its export rules. Officials can warn prospective sellers that a shipment may breach US restrictions, but suspected smugglers can be prosecuted in Taiwan only under other existing laws. The planned addition to the controlled-items list would give prosecutors a direct charge under the Foreign Trade Act once the measures take effect.
Kung connected the plan to commitments in the Agreement on Reciprocal Trade, which the US and Taiwan signed earlier in 2026. “Going forward, some of our measures on controlled items will correspond to American ones,” he said, according to Bloomberg. The proposed controls would give Taiwan’s own authorities a basis to pursue shipments of restricted hardware to China, rather than leaving them to warn sellers about American rules.
The US has restricted Chinese purchases of AI chips from Nvidia and Advanced Micro Devices. US officials have alleged that billions of dollars’ worth of Nvidia hardware nevertheless reached China over the past few years. AI Affairs previously reported on US officials questioning Nvidia about warning signs in China chip-smuggling cases.
Huawei and SMIC were the named buyers
Taiwan placed Huawei Technologies and Semiconductor Manufacturing International Corp on its strategic high-tech commodities list in mid-2025, requiring permits for sales to those companies. Startup Fortune reports that the proposed approach would replace those buyer-specific restrictions with one covering all Chinese buyers. That account describes a wider change than adding further companies to the existing list: the destination, rather than a buyer’s name, would determine whether the restriction applied.
Democratic Progressive Party legislator Chung Chia-pin has drafted an amendment to the Foreign Trade Act containing a mainland China semiconductor chip clause, Startup Fortune reports. The draft and Kung’s proposed changes to the controlled-items list are distinct steps. Kung described the goods the government plans to control and the criminal consequence of an unauthorised shipment, while the report of Chung’s draft concerns an amendment to the Act itself.
The Analog Devices case uses existing offences
A case involving other restricted chips illustrates the charges available to Taiwanese prosecutors. Towards the end of September, prosecutors brought criminal counts for deception, falsifying documents and laundering money against 10 Taiwanese people over an alleged scheme to obtain US chips for shipment to China, The Straits Times reported. Prosecutors alleged that the group had posed as Taiwan’s National Chung-Shan Institute of Science and Technology and affiliated companies since 2017 to buy controlled chips from Analog Devices and Texas Instruments.
Prosecutors accused the defendants of repackaging chips made in the Philippines, South Korea and Singapore and presenting them as non-controlled products made in Taiwan. They alleged that the chips were exported to Hong Kong, including to companies under the de facto control of China, and that the scheme yielded more than NT$300 million. The allegations concern the defendants in that case; they do not establish that the proposed AI hardware controls have taken effect.
The indictment said the chips could be used in radar receivers, electronic reconnaissance and jammers. Prosecutors requested a 10-year prison sentence for Chen Chien-hsiung, who heads several tech companies, and sentences of one to eight years for the other defendants.
