China fails safety review of Micron’s products, blocks some purchases

BEIJING, May 21 (Reuters) – China’s cyberspace regulator said on Sunday that products made by U.S. memory chip maker Micron Technology ( MU.O ) failed its network security review and will bar operators of critical infrastructure from purchasing from the company.

China’s broad definition of critical information infrastructure includes sectors ranging from transportation to finance.

“The review found that Micron’s products contain serious network security risks, which pose significant security risks to China’s critical information infrastructure supply chain, affecting China’s national security,” the Cyberspace Administration of China (CAC) said in a statement.

Micron said it had received the CAC’s notice to review the company’s products sold in China and “look forward to continued discussions with the Chinese authorities.”

The CAC did not provide details on what risks it identified or which Micron products would be affected.

China announced in late March that it was reviewing Micron’s products. At the time the company said it was cooperating and that its business operations in China were normal.

The US and Chinese governments are at loggerheads over chip technology. Washington has imposed a series of export restrictions on chipmaking technology to China and has taken steps to block Micron rival Yangtze Memory Technologies from buying some American components.

Micron gets about 10% of its revenue from China, but it’s unclear whether the decision will affect the company’s sales to non-Chinese customers in the country.

According to analysts, a large portion of Micron’s products flow into China and are used by non-Chinese companies in products manufactured there.

In September 2021 China imposed rules aimed at protecting critical information infrastructure, requiring its operators to comply with stricter requirements in areas such as data protection.

Beijing has broadly defined the industries it considers “vital,” such as public communications and transportation, but it has not specified exactly what type of company or business purpose it would be used for.

Reporting by Kevin Yao; Editing by Elaine Hartcastle

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