Synopsys, Cadence set to resume chip design software exports to China

U.S. chip design software developers said they have received notices lifting restrictions on exports to China, in a signal that the two largest economies had settled a dispute over rare earths that had undermined a trade deal reached in May.

Synopsys and Cadence Design Systems, two of the world's largest electronic design automation (EDA) software developers, said they were restoring access to their software and technology for customers in China.

A letter from Synopsys to staff seen by Reuters said the developer expects to complete system updates to restore access and support to Chinese customers within three business days.

Rival Siemens received a similar notice, Bloomberg reported.

The German tech company and the U.S. Department of Commerce did not immediately respond to Reuters' requests for comment.

Earlier on Wednesday, the U.S. sent letters to ethane producers to rescind a restrictive licensing requirement on exports to China imposed last month.

TIT-FOR-TAT

China in April responded to U.S. export curbs by suspending exports of a range of rare earths and related magnets, upending supply chains central to automakers, aerospace manufacturers, semiconductor companies and military contractors worldwide.

The issue threatened to scupper a trade deal that China and the U.S. were negotiating in May to lower tit-for-tat tariffs.

As China and the United States wrangled over rare earths and magnets access, the U.S. curbed aviation exports including suspending licenses for GE Aerospace to ship jet engines for the C919 aircraft of Chinese airplane maker COMAC CMAFC.UL.

The U.S. also suspended licenses for nuclear equipment suppliers to sell to Chinese power plants and restricted exports including from Synopsys, Cadence and Siemens EDA.

The trio control more than 70% of China's EDA market, Chinese state news agency Xinhua reported in April.

On Friday, China's commerce ministry said that following talks with the U.S., the pair confirmed a framework under which China will review export applications for controlled items while the U.S. will cancel corresponding restrictive measures.

Long-term restrictions on Chinese access to EDA software would have significantly hampered China's chip design industry.

Synopsys suspended its annual and quarterly earnings forecasts after the U.S. implemented the restrictions.