Trump said that there is national security concerns and a statement released by the U.S. Department of Commerce (DoC), officials said the Chinese chipmaker posed "a significant risk of being or becoming involved, in activities contrary to the national security or foreign policy interests of the United States".
The move could cripple Jinhua, which relies on American components for its semiconductors, and followed similar action taken by the Commerce Department this year to block sales of components to ZTE, a Chinese telecom company.
The Commerce Department is restricting United States exports to a Chinese DRAM producer over claims the company stole the manufacturing technology from the US.
Jinhua is completing "substantial production capacity" for integrated circuits, possibly using US technology, which "threatens the long-term economic viability of USA suppliers of these essential components of USA military systems", said a Commerce Department statement. Negotiations have reportedly stalled ahead of a planned meeting between US President Donald Trump and Chinese President Xi Jinping on the sidelines of the upcoming G20 summit in Argentina.
However, the Commerce Department's export ban could end up limiting the Chinese company's development.
5m Pakistan court overturns blasphemy death sentence
The verdict suggested that officials could be open to demands from rights groups for stricter punishments for false accusations. The former prime minister was killed by extremists in 2007 after she threatened to target them if she returned to power.
ZTE, which had violated a deal to settle violations of sanctions on Iran and North Korea, was allowed to resume purchases of US products after a revised settlement and payment of a $1 billion fine.
The Chinese semiconductor maker, . which is opening a new five-point-seven billion dollar chip factory in Fujian province, . has been linked to the Trump administration's accusations that China has systematically stolen and forced the transfer of American technology.
Fujian Jinhua Integrated Circuit will be restricted from buying software and technology goods from American firms.
Calls to Fujian Jinhua's offices rang unanswered Tuesday and there was no immediate response to an inquiry made through their website. "Placing Jinhua on the Entity List will limit its ability to threaten the supply chain for essential components in our military systems".
China established Jinhua in February 2016 in a bid to make its own home-produced chips, with the firm investing 37 billion yuan ($5.6 billion) that year to build a production line.