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Now Apple, the technological giant, is struggling to receive components from suppliers following the crackdown. Apple has also been forced to abandon plans to purchase Chinese memory chips for its iPhones.
Memory chip provider Yangtze Memory Technologies has been added to a blacklist by US officials.
The move is part of the Chips and Science Act of 2022, which was signed by Biden in August to give the US semiconductor supply chain more resilient against China.
The White House also announced a $50billion funding package to support the US semiconductor industry.
The so-called unverified list adds fresh requirements for licensing on any US company which plans to conduct trade with it.
Apple had hoped to use Yangtze memory chips in future iPhone models which may allow the company to challenge its rivals like Samsung.
The US sanctions have been causing havoc for semiconductor companies in both China and the West as they are forced to pause contracts with Chinese-chip producers.
The most recent sanctions have put a block on American citizens working on or supplying technology which may aid China in its efforts to get high-powered semiconductors.
The new restrictions attempt to combat President Xi’s mission to strive ahead in the technology race.
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As a result, ASML shares dropped by 6.5 percent in Monday’s early trading while American companies who make software components for semiconductor manufacturers have seen billions shred from their market value.
The new sanctions are expected to see an instant loss of between $250million and $550million worth of business, warned the US-listed Applied Materials, which sells software to chipmakers.
Companies placed on the unverified list may be moved to the entity list, a harsher blacklist if they are seen as non-compliant with US Government checks, such as Huawei.
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