Taiwan has blacklisted Chinese tech giants Huawei and SMIC, adding them and their global affiliates to its “Strategic High-Tech Commodities Entity List.”

The move, which restricts exports of sensitive technologies, brings Taiwan’s trade policy closer in line with that of the United States and comes amid rising tensions with Beijing.

Taiwan requires companies to obtain official licenses before exporting to any entity on its trade blacklist.

In a notice on its website, the International Trade Administration said Huawei and SMIC were among 601 newly listed foreign entities, flagged over concerns related to arms proliferation and national security.

Huawei and SMIC are also listed on a U.S. trade blacklist and have faced significant setbacks due to Washington’s broad restrictions on advanced chip technology.

Taiwanese firms like Taiwan Semiconductor Manufacturing Co. already comply with U.S. export rules, limiting shipments to blacklisted entities.

In October last year, TSMC came under fire after TechInsights, a semiconductor research firm, identified one of its chips in a Huawei AI training card.

Following the revelation, the U.S. Commerce Department reportedly instructed TSMC to cut off Chinese clients’ access to chips used in AI technologies.

Reuters also reported that TSMC could face a $1 billion fine as part of a potential settlement in the ongoing U.S. investigation.

Despite the restrictions, Huawei is believed to have secured several million GPU dies from TSMC for its AI chips by exploiting earlier loopholes, according to Paul Triolo, partner and senior vice president for China at the advisory firm DGA-Albright Stonebridge Group.

A die is a small slice of silicon that forms the core of a processor, housing the complex circuitry and components needed to carry out computational tasks.