A battle between the U.S. government and China is now brewing in the market for semiconductors, the foundation of electronics.

The U.S. alleges that China is rigging the semiconductor market in its favor by indulging in unfair trade practices.

“This unprecedented state-driven interference can distort the market and undermine the innovation ecosystem,” Penny Pritzker, U.S. secretary of commerce, said during a Wednesday event organized by the Center for Strategic and International Studies.

The Chinese government is using its own resources to artificially reduce chip prices, which is hurting global competition, the U.S. alleges. Pritzker called on China to play fair and in accordance with “global trading rules,” with healthy competition and free and fair trade, not through state investments aimed at distorting global markets.

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