The EDA software restrictions represent the latest evolution in US-China tech competition, moving from end-product controls to fundamental design capabilities. “US continues to find stranglehold on China with critical software and hardware to cut off access to critical and advanced tools,” Shah said.

The United States has ordered a broad swathe of companies to stop shipping goods to China without a license and revoked licenses already granted to certain suppliers, said three people familiar with the matter.

The Bureau of Industry and Security has sent letters to some EDA providers, instructing them to halt shipments to Chinese customers.