US lifts export curbs on chip design software to China

The US government has lifted recent export restrictions on chip design software sales to China, a move that is seen as a step toward easing trade tensions between the two countries. The decision follows a broader trade agreement between Washington and Beijing, aimed at restoring the flow of critical technologies and reducing tariffs imposed during the ongoing trade war. The US Commerce Department notified several major players in the electronic design automation (EDA) software market, including Siemens, Synopsys, and Cadence, that the restrictions imposed in May have been removed. These companies, which dominate the global chip design software industry, confirmed they had been granted the green light to resume sales in China without requiring export licences.

Siemens, the German tech giant, announced that it had “restored full access” to its software and technology in China, following the government’s decision to lift the curbs. “We have resumed sales and support to Chinese customers,” Siemens said in a statement. Similarly, US-based Synopsys and Cadence confirmed that they were working to restore access to their software and technology in China, with both companies affirming that they are complying with US export laws.

The lifting of restrictions comes after China and the US signed a trade deal that promised to ease some of the punitive measures each country had imposed on the other. As part of the agreement, the US agreed to relax curbs on chip design software, ethane exports, and jet engine technology, contingent upon China honouring its pledge to expedite the approval process for critical mineral exports.

A critical move for the semiconductor industry

The restrictions on chip design software were initially implemented in May 2025, as part of a broader effort by the Trump administration to curb China’s semiconductor and artificial intelligence ambitions. These measures were triggered by China’s limitations on the export of rare-earth minerals, which are crucial for electronics and defence manufacturing.

The US software giants, Siemens, Cadence, and Synopsys, dominate the EDA market, collectively holding nearly 80 per cent of China’s market share in this vital sector. EDA software is essential for designing and testing semiconductor blueprints, used in the production of everything from advanced processors for tech giants like Nvidia and Apple to simpler components for consumer electronics. Despite China’s efforts to create a self-sufficient chip design industry, the US companies remain integral to China’s semiconductor production capabilities.

The lifting of these restrictions has been seen as a significant win for the tech companies involved. Shares of Synopsys and Cadence rose by 6 per cent and 7 per cent, respectively, following the announcement. Although the sector represents a relatively small portion of the global semiconductor market, around 1.6 per cent of the $600 billion industry, it plays a critical role in the broader supply chain, making it a key point of contention in US-China trade talks.

Impact on global semiconductor landscape

While the lifting of these restrictions is a positive development for the companies involved, it also highlights the ongoing strategic importance of the semiconductor sector. The US has long been cautious about allowing China access to advanced technologies that could enhance its military and economic power, leading to restrictions on chip design software, chip-making equipment, and high-tech components.

China’s growing push for semiconductor self-sufficiency has seen mixed results, as it still heavily relies on foreign EDA software to produce competitive chips. The trade deal appears to signal a new phase in the US-China relationship, where both sides are willing to ease restrictions in exchange for commitments to accelerate the flow of critical resources, such as rare-earth minerals.

As China and the US work to implement the terms of their trade agreement, the semiconductor industry will be closely watching how future trade dynamics unfold, particularly in the critical areas of chip design software and advanced manufacturing technologies.