(Yicai) Aug. 16 -- Advanced Micro-Fabrication Equipment said it has filed a federal lawsuit against the US Department of Defence for designating the leading chip equipment maker as a “Chinese Military Company.”

AMEC described the CMC designation as “erroneous, factually incorrect, without legal basis, and in violation of due process” in a statement the company released today. The label was “significantly detrimental” to AMEC ’s reputation, it added.

The Shanghai-based company filed the lawsuit with the US District Court for the District of Columbia on Aug. 14.

The blacklist to which AMEC was added on Jan. 31 names companies that the DOD considers to be a threat to US national security and bars them from doing business with some US firms.

AMEC is one of the few Chinese firms able to produce high-end chip-making equipment, making it a key player in China's push for technological self-sufficiency. With units in Taiwan, Singapore, Japan, South Korea, and the US, the firm’s products are mainly focused on the plasma etching and chemical vapor deposition processes. Its etching tools are used by chipmakers to build devices for wide application at nodes as low as 5 nanometers.

"We are deeply shocked by the designation of AMEC again on the military-related list by the DOD," said Chairman and Chief Executive Gerald Yin. "Such designation was wrong and groundless. 

"We believe that the court will make a fair ruling and order AMEC removed from the CMC List," Yin said. “Meanwhile, we are actively working to maintain communication with the DOD in order to properly resolve the dispute.”

AMEC has made extensive efforts to engage with the DOD to clarify the facts and demonstrate that it does not meet any of the CMC criteria, the company noted, adding that it has also requested that the DOD remove the firm from the blacklist but to no avail.

The DOD also wrongly designated AMEC as a “Communist Chinese Military Company” on Jan. 14, 2021. It was removed from that blacklist on June 3 of that year after filling a petition to the DOD with sufficient facts and evidence.

Shares of AMEC [SHA: 688012] closed 1 percent down at CNY146.92 (USD20.48) each in Shanghai today, after earlier dropping by as much as 1.8 percent. The stock has lost 4.3 percent of its value since the end of last year.

Editor: Martin Kadiev