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The US government has scrapped license requirements for providing semiconductor design software to Chinese firms, electronic design automation (EDA) products provider Synopsys revealed in a press release issued yesterday. The restrictions had been placed in May as part of what many believed was leverage against China in trade talks. However, after President Trump and Commerce Secretary Lutnick announced late last month that a trade deal with China had been finalized, Lutnick's department has rescinded the restrictions it imposed in May.
US Rescinds Export License Requirements Levied In May For Semiconductor EDA
The set of restrictions that the Commerce Department has rescinded were levied on EDA companies on May 29th, seemingly as part of the Trump administration's trade negotiations with China. While most of the world's advanced semiconductors are produced in Taiwan, US intellectual property for the chip-making machines and design software enables the US government to restrict sales to countries that are deemed acting against national security interests.
EDA tools form the backbone of the global semiconductor supply chain as they enable firms like NVIDIA, Intel and AMD to design their products. In May, media reports confirmed that Commerce had sent letters to EDA firms, including Cadence, Synopsys and Siemens, which required them to secure a license to export products to China.
Interestingly, news of the restrictions had broken the day Synopsys had reported its fiscal second quarter quarter earnings. During the call, its CEO had denied receiving such a letter, and its shares clawed back some of their losses after the firm maintained its full-year guidance. However, later on, the firm suspended its guidance as it shared in an SEC that it was "currently assessing the potential impact of the BIS Letter on its business, operating results and financial condition."
However, while the Synopsys CEO had denied receiving the letter the day news of the latest sanctions broke, the firm confirmed today that Commerce had decided to remove the May EDA restrictions on China. In a press release on its website, the firm shared that it "received a letter from the Bureau of Industry and Security of the U.S. Department of Commerce informing Synopsys that the export restrictions related to China, pursuant to a letter received on May 29, 2025, have now been rescinded, effective immediately."
Synopsys added that it was working to "restore access to the recently restricted products in China" and assessing "he impact of export restrictions related to China on its business, operating results and financials."
Like Synopsys, EDA provider Cadence had also confirmed the restrictions in May. In an SEC filing, the Synopsys peer had revealed that it would now require a license for the "export, re-export or in-country transfer of electronic design automation software and technology" under certain classifications to entities in China. Cadence added that it was assessing "the impact on our business and financial results," but unlike Synopsys, the firm has not confirmed the rules being rescinded.
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