China fails Micron’s products in safety review, prevents 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 ) have failed its network security review and that it will bar key infrastructure operators from procuring from the firm.

According to China̵[ads1]7;s broad definition of critical information infrastructure, this can include sectors ranging from transportation to finance.

“The review found that Micron’s products have 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 of conclusion of its review of the company’s products sold in China and “looks forward to continuing to engage in discussions with the Chinese authorities”.

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

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

The authorities in the US and China are in a dispute over chip technology. Washington has imposed a series of export controls on chip technology to China and moved to prevent Micron rival Yangtze Memory Technologies from buying certain American components.

Micron derives about 10% of its revenue from China, but it is not clear whether the decision affects the company’s sales to non-Chinese customers in the country.

The bulk of Micron’s products flowing into China are bought by non-Chinese firms for use in products manufactured there, according to analysts.

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

Beijing has broadly defined the industries it considers “critical” as such as public communications and transportation, but it has not specified exactly what type of company or scope of business this would apply to.

Reporting by Kevin Yao; Editing by Elaine Hardcastle

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