Chip giant TSMC has 'kill switch' to disable machine should China invade Taiwan

ASML Holding NV and Taiwan Semiconductor Manufacturing Co. (TSMC) have kill switch in place to disable their advanced chipmaking machines remotely if China invades Taiwan, according to insiders, Bloomberg reported.

ALSO READ- Why China's military has surrounded Taiwan with aircraft and ships

US officials have privately voiced concerns to Dutch and Taiwanese counterparts about potential Chinese aggression towards Taiwan, which produces the majority of the world’s advanced semiconductors. ASML has reassured Dutch officials that they can remotely disable the machines if necessary. The Netherlands has conducted simulations to assess the risks.

The remote shutdown applies to ASML’s extreme ultraviolet (EUV) machines, which TSMC heavily relies on. These machines are crucial for creating advanced microchips used in AI and military applications. ASML, the sole manufacturer of these machines, has restricted sales to China under US pressure.

ALSO READ- Biden announces another huge deal with Taiwan-based semiconductor manufacturer; how will it benefit US?

China claims Taiwan as its territory and has not ruled out military intervention. Despite US warnings of a potential invasion by 2027, Taiwanese officials have downplayed the threat. Meanwhile, China has made technological self-sufficiency a priority, with Huawei producing advanced smartphones using older ASML printers.

ALSO READ- ‘Serious warning’: China threatens to break heads of Taiwan independence forces

ASML’s EUV machines have made it Europe’s most valuable tech company, with a market cap of over $370 billion. Since 2016, ASML has shipped more than 200 EUV machines outside China, with TSMC being the largest client.

EUV machines require frequent upkeep, and without ASML’s spare parts, they quickly become non-operational. ASML provides joint service contracts, allowing clients like TSMC to perform some maintenance, but asserts it cannot access customers' proprietary data.

TSMC chairman Mark Liu had indicated that in the event of an invasion, their chipmaking machines would be rendered non-operational.

“Nobody can control TSMC by force,” Liu said. “If there is a military invasion you will render TSMC factory non-operable,” Liu said in a September interview with CNN.