AsianFin -- Taiwan Semiconductor Manufacturing Company (TSMC), the world’s leading contract chipmaker, has terminated its partnership with a Singapore-based company after a client audit revealed a potential violation of US export restrictions, SCMP reported, citing sources familiar with the matter.

The decision to sever ties with PowerAIR, a relatively low-profile Singaporean firm, followed the discovery of a TSMC chip in an artificial intelligence (AI) processor developed by Huawei Technologies. The termination came after a routine client review, which triggered concerns over compliance with US export controls, according to three individuals with direct knowledge of the situation.

PowerAIR is the second company to face scrutiny in connection with the Huawei case. Last year, TSMC suspended shipments to Sophgo, a mainland China-based chip design firm, after one of its chips, ordered from TSMC, was found to match a chip used in Huawei’s Ascend 910B multi-chip system, as reported by Reuters in October, citing anonymous sources.

Huawei, the Chinese tech giant, has been banned from accessing semiconductor foundries globally since 2020 under a comprehensive US trade ban. TSMC has publicly stated that it has not supplied products to Huawei since that time. Huawei, in turn, has confirmed that it has not produced chips with TSMC since the imposition of US sanctions.

Both Sophgo and its affiliate, Bitmain, a supplier of bitcoin mining equipment, have denied any business dealings with Huawei.