China adopted guidelines to halt the use of U.S.-made microprocessors from Intel and AMD in government servers and personal computers, the Financial Times reported on Sunday.
AMD fell 2% while Intel dropped 4% in morning trading Monday.
The guidance also seeks to cut usage of Microsoft's Windows operating system and foreign-made database software, replacing both with domestic alternatives, the report said.
Chinese officials have begun following the guidelines, first introduced in December. The rules required government agencies above the township level to include criteria requiring "safe and reliable" processors and operating systems when making purchases, the newspaper said.
Microsoft and Intel declined to comment to the Financial Times, while AMD didn’t immediately respond to a request for comment.
China for years has worked to eliminate key foreign-made technology from sensitive operations. The country in 2022 ordered central government agencies and state-backed companies to replace foreign brands of personal computers with domestic offerings within two years.