TSMC halts new Huawei orders after US restrictions

The move could deal a big blow to Huawei which is facing restrictions from the US government.

TSMC, the world's biggest contract chipmaker and a key Huawei supplier, had announced plans to build a US-based plant on Thursday (REUTERS)

Taiwan Semiconductor Manufacturing Co Ltd has stopped new orders from Huawei Technologies in response to Washington's move aimed at further limiting chip supplies to the Chinese company, the Nikkei reported on Monday, citing multiple sources.

The orders which TSMC took before the new ban and those already in production are not impacted and could continue to proceed if those chips could be shipped before mid-September, according to the report. 

TSMC, the world's biggest contract chipmaker and a key Huawei supplier, had announced plans to build a US-based plant on Thursday and on Friday added it was "following the US export rule change closely".

A new rule, unveiled by the US Commerce Department on Friday, expands US authority to require licenses for sales to Huawei of semiconductors made abroad with US technology, vastly expanding its reach to halt exports to the world's No. 2 smartphone maker.

Huawei declined to comment, while TSMC said it does not disclose order details and added the report was "purely market rumour".