The Biden administration plans to broaden curbs on US shipments of semiconductors for artificial intelligence and chipmaking tools to China, Reuters reported, citing unidentified people familiar with the matter.

The Commerce Department planned to publish new regulations based on restrictions communicated in letters to KLA Corp., Lam Research Corp. and Applied Materials Inc. The agency banned them from exporting chipmaking equipment to factories in China that produce 14-nanometer or more advanced semiconductors, unless the sellers obtain licenses. 

The letters, which the companies publicly acknowledged, forbade them from exporting chip-making equipment to Chinese factories that produce advanced semiconductors with sub-14 Nm processes, unless the sellers obtain Commerce Department licenses.

The rules would also codify restrictions in Commerce Department letters sent to Nvidia Corp and Advanced Micro Devices last month, instructing them to halt shipments of several artificial intelligence computing chips to China, unless they obtain licenses.

Some of the sources said the regulations would likely include additional actions against China. The restrictions could also be changed, and the rules published later than expected.

The so-called "is informed" letters allow the Commerce Department to bypass lengthy rule-writing processes to put controls in place quickly, but these letters only apply to the companies that receive them.

Turning the letters into rules would broaden their reach and could subject other US companies producing similar technology to the restrictions. The regulations could potentially apply to companies trying to challenge Nvidia and AMD's dominance in artificial intelligence chips.

Intel Corp and startups like Cerebras Systems are targeting the same advanced computing markets. Intel said it is closely monitoring the situation, while Cerebras declined to comment.

One source said the rules could also impose license requirements on shipments to China of products that contain the targeted chips. Dell Technologies, Hewlett Packard Enterprise and Super Micro Computer make data centre servers that contain Nvidia's A100 chip.

Dell and HPE said they were monitoring the situation, while Super Micro Computer did not respond to a request for comment.