ARM won’t sell its latest Neoverse V series chips to Chinese tech giant Alibaba after concluding that the US and UK would not approve licenses to export them, according to The Financial Times. The decision follows new US government rules restricting China and Russia exports of powerful chips that could be repurposed for military use. 

Softbank-owned ARM reportedly believes that Neoverse V would fall into the category of high-performance processors affected by the new rules. While it could apply for a license, it would likely be turned down, according to FT‘s sources with knowledge of the sale process. It may be the first time that ARM has decided not to sell it’s most advanced chip designs to China.

ARM designs the advanced RISC architecture for chips used in products ranging from smartwatches to advanced supercomputers. It doesn’t build the processors itself, but sells the designs to manufacturers like TSMC and Samsung. Its latest Neoverse V2 core has the highest performance to date, with a design said to have originated in the US. 

The Biden administration is also reportedly set to put Chinese chip manufacturer YMTC on its entity list as early as next week, according to a separate FT article. The company reportedly violated US export controls by supplying Chinese smartphone manufacturer Huawei with NAND memory chips. 

The US government had YMTC on an “unverified” entity list, meaning it was unable carry out checks to confirming that domestic technology wasn’t being used illegally. Thirty Chinese companies including YMTC had 60 days to comply to avoid being placed on an entity list that severely restricts exports. The Chinese government now allows such checks, but not all companies are necessarily cooperating. 

The US unveiled sweeping tech export controls in October. “This includes preventing China’s acquisition and use of US technology in the context of its military-civil fusion program to fuel its military modernization efforts, conduct human rights abuses, and enable other malign activities,” it said at the time. When the rules were announced, analysts said that memory chipmakers like YMTC would be most affected.

China filed a dispute with the World Trade Organization earlier this week over those export controls. The US government considers YMTC to be a “national champion” in China, so the latest move is likely to be met with a strong reaction.