Export controls on South Korea worry Japanese makers of semiconductor materials


Japanese manufacturers of three kinds of semiconductor materials that will soon face export restrictions to South Korea have reacted to the news with surprise, concern and disappointment.

The government announced Monday that it will tighten controls on exports of resists, hydrogen fluoride and fluorinated polyimide to South Korea, effective Thursday, in an apparent retaliatory move over the ongoing dispute on wartime labor.

Domestic companies that will be affected by the move are scrambling to gather information as they were not told of the decision in advance.

The news “came out of the blue,” an industry group official said.

Of the three materials, resists boast the largest market size. Mostly produced in liquid form, they are used for coating semiconductor substrates and, after being illuminated, for transferring semiconductor circuit patterns.

JSR Corp., Tokyo Ohka Kogyo Co. and Shin-Etsu Chemical Co. are leading manufacturers of the material.

Cutting-edge extreme ultraviolet (EUV) resists, their raw materials and related technology will mainly be subjected to the tighter export controls, according to informed sources.

Prior notification will be required for manufacturers to export EUV resists to South Korea, the sources said.

Semiconductors processed with EUV resists are used in key components of smartphones produced by South Korean industry giant Samsung Electronics Co.

A public relations official at Tokyo Ohka Kogyo expressed concern over the government’s move.

“We’re hugely disappointed,” the official said, noting that the decision was announced just after news over the weekend that U.S. restrictions on trade with China’s Huawei Technologies Co. may be relaxed, which somewhat eased Tokyo Ohka Kogyo’s concerns over the impact on its supply chain.

However, the official said that Tokyo’s latest move will have a “limited impact” on the company, since its production volume of EUV resists is relatively low and the company has a production facility in South Korea.

Morita Chemical Industries Co., a leading manufacturer of hydrogen fluoride, which dissolves parts of semiconductor substrates that are unnecessary in circuit formation, said the company hopes to continue exports to South Korea even though more work is expected to be required, such as submitting necessary documents in advance.

Many industry officials expressed concern over the government’s move and the future outlook for the industry.

“The tighter export controls are disappointing, particularly since we have been calling for open and free trade practices,” one official said.

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