US-based chip-tech group moving to Switzerland over trade curb fears

AUS-basedfoundationoverseeing promising semiconductortechnology developed with Pentagon support will soon move toSwitzerlandafter several of thegroup's foreign members raised concerns about potentialUStradecurbs.

The nonprofit RISC-V Foundation (pronounced risk-five) wants to ensure that universities, governments, and companies outside the United States can help develop its open-sourcetechnology, it's Chief Executive Calista Redmond said in an interview with Reuters.

She said the foundation's global collaboration has faced no restrictions to date but members are "concerned about possible geopolitical disruption."

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"From around the world, we've heard that 'If the incorporation was not in theUS, we would be a lot more comfortable'," she said. Redmond said the foundation's board of directors approved the move unanimously but declined to disclose which members prompted it.

Created in 2015, the RISC-V Foundation sets standards for the corechiparchitecture and controls who can use the RISC-Vtrademark on products, as other organizations do for Wi-Fi and Bluetoothchips. It does not own or control thetechnology.

More than 325 companies or other entities pay to be members, includingUSand Europeanchipsuppliers such as Qualcomm Inc and NXP Semiconductors, as well as China's AlibabaGroupHolding Ltd and HuaweiTechnologies Co Ltd.

The foundation's move from Delaware toSwitzerlandmay foreshadow furthertechnology flight because ofUSrestrictions on dealing with some Chinesetechnology companies, said William Reinsch, who was undersecretary of commerce for export administration in the Clinton administration.

"There is a message for the government. The message is if you clamp down on things too tightly this is what is going to happen. In a global supply chain world, companies have choices, and one choice is to gooverseas," he said.

In a statement to Reuters, theUSDepartment of Commerce said its controls were designed to safeguardU.S. national security and to "ensure bad actors cannot acquiretechnology that harmsUScitizens or interests while promoting innovation to fuel continued Americantechnological leadership." The department said it meets regularly with private industry to gauge market conditions and the effects of its regulations.

Some RepublicanUSlawmakers said they are concerned the United States will lose influenceoverRISC-Vchiparchitecture, which can be used to make microprocessors for almost every type of electronic device, making it a crucial building block of a modern economy. Thetechnology came from labs at the University of California, Berkeley, and later benefited from funding by the Pentagon's Defense Advanced Research Projects Agency (DARPA).

The lawmakers warn that the foundation's Chinese members could influence thetechnology's development to help China's semiconductor industry.

"The Chinese Communist Party is trying to circumvent our export control system to support national security threats like Huawei - we cannot let it succeed," Representative Mike Gallagher, a Republican from Wisconsin, told Reuters.

Arkansas Republican Senator Tom Cotton saidmovingthe foundation to ensure it could retain Chinese members was "short-sighted at best." He added that "if American public funds were used to develop thetechnology, it’s also completely outrageous."

Redmond said in follow-up emails after speaking to Reuters that given thetechnology is open source and available to anyone, she does not see how the move could be against theUSnational interest.

A DARPA spokesman told Reuters the agency intended for RISC-V work is funded to be publicly available to companies and academics around the world.

Morgan Reed, president of The App Association, which receives funding from majorUStechnology firms such as Apple Inc and Microsoft Corp in Washington, likened the RISC-V Foundation's work to efforts betweenUSand Chinese companies to jointly develop Wi-Fichipstandards.

"The notion that China can be barred from participating in standards alongside theUSand the EU is simply not viable," Reed said. "China is too important as a manufacturer and an end-market to ignore."

The RISC-V Foundation announced at a meeting last December it would seek a "neutral" country before making a formal decision to go toSwitzerlandearlier this year, a decision that got little public attention. Final approvals inSwitzerlandfor the move are expected as soon as the end of November, Redmond said.

Chinese companies have had access to the RISC-V architecture, which is publicly available, since its creation, Redmond said.

Alibaba claimed in July it had developed the fastest RISC-V processor to date. The company declined to comment for this story.

The RISC-V Foundation's move shows howUS-Chinatradetensions could make the United States a harder place to hosttechnology standards groups, according to two attorneys who represent such groups.

The lawyers said it is unclear whether standards groupsare allowed to work with Huawei. These groupsare concernedUSauthorities may decide that some closed-doortechnical discussions involve the transfer of sensitivetechnology to the Chinese or others on banned lists, said one of the attorneys, Brad Biddle, who works for several standards groups.

In June, more than two dozen standards groups- including thoseoverseeing SD memory cards and Ethernet and HDMI cables - wrote a letter to US Commerce Secretary Wilbur Ross asking for clarification of the rules on working with Huawei.

The groupswarned Ross that the Huawei restrictions posed a "serious risk" that standards work could move out of the United States, which could end a long-held trend whereUS-basedgroupsset de facto standards for the rest of the world, they wrote.

The Commerce Department published an advisory opinion seeking to clarify the issue in August, but standards lawyers said the rules remain confusing.

The RISC-V Foundation's Redmond does not yet see a "credible threat" to international collaboration. "But we're taking out an insurance policy against that type of action bymovingour incorporation," she told Reuters.

The board's seven current members are allbasedin North America. After the move, the foundation's board will be expanded and European and Asian members will be added, said Redmond. Reuters could not confirm whether any Chinese companies planned to join the board.

Andrew Updegrove, an attorney who does work for standards groups, said thatUSrestrictions on transferringUS-origintechnology to Chinese companies will still apply regardless of where the RISC-V Foundation is headquartered.

At Netherlands-basedNXP Semiconductors, which is a member of the foundation, customers have asked the company to detail where thetechnology in itschips comes from, said Lars Reger, its chieftechnology officer. The customers do not want to be cut off in futuretradedisputes, he said.

US officials and some lawmakers have alleged Huawei's telecom equipment may enable surveillance by China. The resulting backlash has prevented it from making inroads into theUSmarket. Huawei has denied the claims.

In response to Reuter's questions, a Huawei spokesman said: "We support RISC-V Foundation identifyingSwitzerlandas a neutral venue for open source development. Making open source as open as possible is important for the industry."

He said that RISC-V "might fit well into Huawei's vision of this heterogeneous, open world."