The move comes after chips made by Taiwan's largest producer were found in Huawei AI processors at the end of last month.

STORY: China’s chip index leapt to close at a three-year high on Monday (November 11). That’s on bets Beijing will accelerate its chip-making efforts after the U.S. ordered Taiwan’s TSMC to suspend shipments of advanced semiconductors to Chinese clients.

China's Taiwan Affairs Office said on Wednesday that a U.S. order to Taiwan Semiconductor Manufacturing Co to halt shipments of advanced chips to Chinese customers undermines the interests of Taiwanese companies and raises tension across the Taiwan Strait.

The US Department of Commerce ordered Taiwan Semiconductor Manufacturing Company to stop shipping advanced chips to Chinese customers starting yesterday, Monday, Nov. 11. The government sent a letter to TSMC specifying that this restriction applies to all chips that are seven nanometers or smaller,

China’s semiconductor index surged to nearly a three-year peak on Monday, fueled by expectations that new U.S. export restrictions on Taiwan Semiconductor Manufacturing Co. (TSMC) could expedite China’s push for semiconductor self-sufficiency.

TSMC has reportedly notified Chinese customers that shipments of AI-related chips made with 7nm or below processes will be halted. Additionally, any AI chip projects initiated after November 11 must be approved by the US Department of Commerce and other relevant agencies.