The US opened up a new front in the conflict by barring any chipmaker using American equipment from supplying Shenzhen's Huawei Technologies without US government approval.
That means TSMC will have to cut off Huawei unless they get waivers from the US Commerce Department. TSMC has already stopped accepting new orders from Huawei, the Japan's Nikkei newspaper reported.
The move threatens to wreak havoc throughout the complex ecosystem that produces technology for consumers and companies around the world. An attack on Huawei threatens not just its workers and its standing as a world leader in making smartphones and telecom equipment, but also hundreds of suppliers.
The Chinese government has vowed to protect its national champion, with threats of retribution against US companies that depend on China like Apple and Boeing.