Tech Giants: Starting from Bankrupt Companies

121: Chapter 121: The Darkest Hour. The White House’s Final VerdictWashington, December 6, 7:30 AM.

In the Situation Room of the White House, the morning light filtered through the bulletproof glass windows, cutting sharp light and shadow onto the dark carpet.

Seven people sat in silence around the long conference table, their coffee having gone cold, untouched.

US President John Keller sat at the head of the table; this 65-year-old former Marine General was known for his tough stance on China.

At this moment, his fingers tapped rhythmically on the table as his gaze swept over everyone present: the Secretary of State, the Secretary of Defense, the Secretary of Commerce, the CIA Director, the National Security Advisor, and the White House Chief of Staff.

”Ladies and gentlemen,” Keller’s voice was low and gravelly, ”Four months ago, we decided here to implement a technology blockade against Spark Technology. The expectation at the time was: this Chinese company would collapse within six months.”

He paused; there was only the faint whirring of the air conditioning vents in the conference room.

”But the reality is—” The President pulled up the big screen, ”Spark is not only alive, but has also made breakthroughs in three areas simultaneously: chips, materials, and automobiles. 16-nanometer chips are in mass production, they’ve secured tens of billions in orders for military materials, and monthly sales of Hongqi Automobile have exceeded 30,000 units.”

A set of comparative data appeared on the screen:

September 2017 vs. November 2017

Spark Technology market value: 2.1 trillion vs. 4.3 trillion

Global partner companies: 12 vs. 87

Technology patent applications: 1,200 vs. 3,800

Secretary of Commerce Eric Wharton pushed up his glasses: ”What’s more dangerous is the technological path. Spark has completely bypassed our patent system and established a complete industrial chain based on FD-SOI, independent EDA, and non-American equipment. If this model is emulated by other countries...”

He didn’t finish, but everyone understood.

CIA Director James Miller added more sensitive intelligence: ”We have been continuously monitoring Spark’s R&D activities. One anomaly is that their technological breakthroughs lack the usual ’learning curve.’ For example, from 28nm to 16nm, the industry average takes three years, while Spark only took a year and a half. Moreover, breakthrough points often occur after key technical personnel have contact with unknown signal sources.”

”Unknown signal sources?” The Secretary of Defense frowned.

”Encrypted communications that cannot be tracked,” Miller said. ”We used the NSA’s most advanced systems and could only monitor that there was data transmission, but the content, source, and destination were all encrypted. Technical experts say that this level of encryption... is not something achievable with existing technology.”

The conference room fell into an eerie silence.

Secretary of State Sarah Cohen broke the silence: ”So, conventional methods have failed. We need to consider the ultimate solution.”

She pulled up a document: ”’Ultimate Solution for Long-Arm Jurisdiction’—authorizing the President to implement comprehensive strikes, including trade embargoes, financial blockades, and third-party sanctions, against foreign entities that pose a ’systemic threat’ to the national security of America. It has only been used three times in history: the natural gas pipeline embargo against the Soviet Union, the oil sanctions against Persia, and the total blockade of North Korea.”

”Is Spark qualified?” the President asked.

”Absolutely,” the Secretary of Defense replied. ”Their military materials are used directly in China’s most advanced fighter jets, their chips are used in military communication equipment, and their automotive technology has dual-use potential. More importantly—Spark is proving that China can establish a parallel technology ecosystem outside the system dominated by America. This is more dangerous than specific technological breakthroughs.”

National Security Advisor Mark Thompson gave the final summary: ”If we don’t act now, in three years, China will possess a completely independent semiconductor industry chain, advanced materials system, and new energy vehicle industry. By then, our technology blockade will be completely ineffective, and the geopolitical balance will be permanently changed.”

The clock on the wall pointed to 8:45 AM. The morning light had completely illuminated the room, but the atmosphere was gloomier than in the dead of night.

The President looked around the circle; everyone’s expression was heavy, but no one objected.

”Then do it,” Keller finally said. ”Notify all allies: either cooperate in sanctioning Spark, or face secondary sanctions. I want to completely cut off all ties between this company and the global mainstream economy.”

He paused and added, ”History will remember today. Either we stopped the rise of a challenger, or... we personally birthed an even more powerful opponent.”

The order was issued at 9:00 AM.

On the evening of December 6, 8:00 PM Washington time, the US Department of Commerce website was updated.

The title was just one line: ”Final Sanction Decision Against Chinese Spark Technology Group and Its Affiliated Entities.”

The main text was seventy-three pages long, but the core content could be summarized into a few cruel clauses:

Chapter 1: Comprehensive Embargo

Prohibit products of Spark Technology Group, Xingchen Heavy Industry Group, and all their affiliated subsidiaries from being sold in 38 countries and regions, including America, the European Union, Japan, South Korea, and Singapore.

Prohibit any enterprise in the aforementioned countries and regions from conducting any form of business cooperation with the xinghuo system—including but not limited to technology licensing, foundry services, component supply, and sales agencies.

Prohibit the export of any goods, technology, or services, including non-sensitive civilian products, to the xinghuo system.

Chapter 2: Financial Blockade

Prohibit global financial institutions from providing any financial services to the xinghuo system, including US dollar settlement, letter of credit issuance, and financing loans.

Freeze all assets of the xinghuo system in the aforementioned 38 countries and regions.

Prohibit international credit card organizations (Visa, MasterCard, etc.) from providing services for Spark-related transactions.

Chapter 3: Retroactive Clauses

Existing contracts are to be terminated immediately without compensation.

Shipped products must be recalled within 30 days.

Ongoing projects are to be suspended immediately.

Chapter 4: Special Targeting

Joint ventures with Spark (Volkswagen-Spark, Infineon-Spark) must complete divestment within 30 days.

American citizens and permanent residents working for Spark must resign within 60 days, or their visas/green cards will be revoked.

Third-country enterprises that continue to cooperate with Spark will be added to the ”Special Watch List” and face secondary sanctions.

The document ended with a bolded paragraph:

”This decision is authorized based on America’s ’International Emergency Economic Powers Act’ and ’National Security Act’ and has mandatory enforcement power. Any act in violation of this decision will face criminal prosecution and up to 25 years in prison.”

The news spread across the globe like a nuclear shockwave.

December 7, 9:00 AM Shenzhen time.

Su Chen saw the Chinese translation of this document in his office. Lin Wan stood beside him, her face pale.

”President Su, the legal department of Volkswagen China sent an email five minutes ago.” Lin Wan’s voice was trembling, ”They... terminated all cooperation with Red Flag. Including technology sharing and joint R&D.”

The phone rang; it was Zhou Qingyu calling from Changchun.

”President Su, Volkswagen’s people are withdrawing from the factory.” Zhou Qingyu’s voice was hoarse.

”It’s fine, we’ll do the remaining technical R&D ourselves,” Su Chen said.

The second call came from Singapore, from Lin Haoran.

”President Su, people from the Singapore government have arrived.” Lin Haoran’s voice was full of bitterness, ”They ordered us to close the R&D center within 72 hours, and all personnel must leave within a time limit. The $50 million worth of equipment we just bought... is all sealed.”

”What about the personnel?”

”US citizens and green card holders have already received notification from the American Consulate: if they don’t resign within 60 days, their visas will be revoked. Twelve colleagues... decided to stay. But their families are still in America.”

The third call was from Infineon CEO Karl Heinz, calling from Germany on a secure line.

”Su Chen, I am very sorry.” Heinz’s English carried a heavy German accent, ”The Federal Ministry for Economic Affairs summoned me this morning and said that if we don’t terminate our cooperation with Spark, America will impose secondary sanctions on Infineon—banning the export of all American technology to Infineon. Without American EDA software and some equipment, our factory won’t last three months.”

Su Chen was silent for a few seconds: ”I understand.”

”Then the joint venture...”

”Terminate it according to the contract,” Su Chen said, ”But I hope that the equipment already delivered can be left to us.”

Heinz sighed long and hard: ”I will try. But... I’m not sure. The CIA is watching.”

The phone hung up.

The office fell into dead silence. Outside the window, Shenzhen was still bustling with traffic and bright sunshine, but Su Chen felt the whole world fade in an instant.

Su Chen walked to the window. Forty-five floors down, the traffic on Shennan Avenue was as busy as ever. This city, this country, was still operating normally.

But Spark was pushed to the edge of a cliff.

”President Su, what do we do now...” Lin Wan hesitated.

Su Chen turned around, his face devoid of panic, only a deep calm.

”Gather all executives, meeting in an hour.” He said, ”Also, notify the state-owned assets department, we need emergency support.”

”And...” He paused, ”Prepare for the worst.”

Brussels, December 7, 8:00 AM.

At the European Commission headquarters, the press briefing room was packed with reporters. European Commissioner for Trade Margrethe Vestager stepped onto the podium. This Danish woman, known for her toughness, had an unusually grim expression today.

”Based on the transatlantic alliance relationship and our shared security interests, the European Union has decided to cooperate in implementing America’s sanction measures against Spark Technology Group.” Her voice had no inflection, as if reading a verdict, ”Effective immediately, European Union member state enterprises must terminate all cooperation with the xinghuo system. Violators will face penalties at the EU level.”

The audience was in an uproar. A reporter raised a hand: ”Commissioner, what is the EU’s own assessment? Does Spark really pose a threat to European security?”

Vestager was silent for two seconds: ”This is a decision based on overall strategic considerations.”

She didn’t say that three hours ago, the Office of the United States Trade Representative had sent an ultimatum—if the EU did not cooperate, America would impose a 50% tariff on Airbus and implement import restrictions on German automobiles. This was a price Europe could not afford.

After the press conference, Vestager’s assistant handed her an internal report. She flipped through it quickly, her brows furrowed.

The report showed that Germany and France strongly opposed sanctioning Spark. The German Minister for Economic Affairs stated bluntly in an internal meeting: ”This is forcing China to accelerate ’de-Americanization,’ which ultimately harms the long-term interests of European companies.”

The French President even called the White House directly, but was blocked by the President’s Assistant for National Security Affairs.

”Politics overrides economics.” Vestager closed the report and whispered to herself, ”But how long can politics suppress it?”

Tokyo, 10:00 AM.

In the office of the Minister of Economy, Trade and Industry, Nakamura Hiroshi, the atmosphere was suffocating.

”Toyota, Honda, and Sony have all received formal notifications.” An official reported, ”They asked: what about the products already shipped? What about the projects currently underway?”

Nakamura looked at the Imperial Palace outside the window; the ancient buildings were silent under the winter sun. He remembered a month ago, he was still promoting cooperation with Spark, believing it was an opportunity for the revival of Japan’s semiconductor industry.

Now, the opportunity had become a trap.

”Execute it,” he finally said, ”But tell the companies: technical exchanges can go underground, don’t break personnel contacts. Japan... needs to leave a way out.”

”Minister, what about America...”

”I will go and explain,” Nakamura turned around, ”Just say we are strictly executing it. But execution has ’time differences’ and ’loopholes’; this is the norm of the bureaucracy, the Americans understand.”

He paused: ”Japan cannot put all its eggs in one basket anymore. This path with China cannot be completely cut off.”

Seoul, 11:00 AM.

Samsung Electronics headquarters, Lee Jae-yong’s office.

”Chairman, the American embassy has arrived.” The secretary reported in a low voice, ”They require us to immediately cut off all contact with Spark, including informal technical exchanges.”

Lee Jae-yong stood by the window, looking at the Han River. Cruise ships were passing on the river, tourists were taking pictures, everything was as usual. But in this room, a choice concerning the future of Samsung was unfolding.

”Notify the semiconductor department: terminate all cooperation projects with Spark on the surface,” Lee Jae-yong said, ”But keep the contact channels for the technical teams. Also...”

He turned around: ”Start our own FD-SOI R&D and invest double the resources. The more the Americans want to blockade, the more it shows this path has value.”

”Chairman, the risk is very high.”

”The risk of not taking risks is even higher,” Lee Jae-yong said, ”If Spark really walks through the non-American technology route, and Samsung is still tied to America’s war chariot, we will be eliminated in ten years. On this matter, we cannot just look at America’s face.”

Singapore, 3:00 PM.

Marina Bay Financial District, Spark Singapore R&D Center.

Lin Haoran watched his colleagues busily packing in the office, a heavy stone weighing on his heart. This center had only been established for three months and was just getting on track, and now it had to close.

”President Lin, the government’s clearance order.” An official from the Singapore Economic Development Board handed over a document, ”72 hours. We can temporarily keep the equipment on your behalf, but the personnel must leave.”

”That equipment is worth $50 million,” Lin Haoran said.

”We know. But this is a political decision,” the official said in a low voice, ”President Lin, to be honest, we are very sorry. Spark has invested so much in Singapore and created so many high-paying jobs... But small countries have no choice in the game between great powers.”

Lin Haoran nodded. He understood, but was unwilling.

He walked to the window and looked at the bustling scene of this garden city. This place was once a symbol of Spark’s globalization, and now it had become the first victim.

His phone vibrated; it was a message from Su Chen: ”Bring the team home. Shenzhen needs you.”

Lin Haoran’s eyes grew hot. He turned around and said loudly to his colleagues in the office: ”Pack your things, we’re going back to Shenzhen!”

Someone raised their hand: ”President Lin, my green card...”

”The company understands those who are willing to stay. Spark will always welcome those who are willing to return to the country,” Lin Haoran said, ”But I must tell you: returning to the country means you may never be able to leave again. America will put us on a blacklist, and your career may be completely changed.”

A short silence.

Then, a young engineer stood up: ”I’m going back. I studied and worked in America for eight years, and in the end, I was still treated as an outsider. It’s better to go back and do something real.”

The second one stood up: ”I’m going back too. The stock options Spark gave are enough to buy a house in Shenzhen.”

The third, the fourth... In the end, out of the team of 46, 32 decided to return.

Lin Haoran looked at these young faces, and complex emotions welled up in his heart. There was tragedy, there was hope, and more importantly, responsibility—to bring these people back safely, and to rebuild a better R&D center in Shenzhen.

Outside the window, the sunset in Singapore was like blood.

And in Shenzhen, night was falling.