The Netherlands has taken a significant step in limiting China’s access to high-performance semiconductors by announcing plans to restrict the export of key chip-making tools. This move is part of the US’s ongoing effort to curb China’s ability to develop advanced military technologies such as hypersonic missiles. The Financial Times reports that the deal, which was reached with the US in January, is expected to include controls on critical chip-making technology from the Dutch multinational ASML Holding. The announcement was made public this week when Dutch trade minister Liesje Schreinemacher wrote to parliament to outline the new measures.
ASML building in Eindhoven, Netherlands. (Image source: JPstock/Shutterstock)
ASML is a key player in the global chip supply chain, producing the tools necessary for advanced semiconductor production. Without its equipment, any domestic chipmaker in China will face significant challenges producing advanced chips. The letter from Schreinemacher did not name China directly or explicitly mention ASML, but it did call out deep ultraviolet (DUV) lithography systems, which ASML is currently able to sell to customers in China. After restrictions are introduced, companies are expected to require licenses to export this technology.
“Because the Netherlands considers it necessary on national security grounds to get this technology into oversight with the greatest of speed, the Cabinet will introduce a national control list,” Schreinemacher wrote in her letter to parliament, according to Reuters. New legislation is expected to be introduced before the summer to enact the new controls.
While China has voiced opposition to the plans, ASML reportedly doesn’t expect the restrictions to affect its previously announced financial forecasts. It expects sales to China to remain flat this year, even as overall sales increase by 25 percent. ASML also produces more advanced extreme ultraviolet (EUV) lithography tools, although it has been banned from selling these tools to China since 2019.
The US has already announced wide-ranging chip sale restrictions of its own last October, and Japan is also understood to have made a deal with the US to introduce similar export restrictions. While Japan is yet to announce anything publicly, an update could arrive soon, according to Reuters.
The Netherlands have taken a bold step to safeguard their international interests and allies by limiting China’s access to cutting-edge semiconductors. This comes in conjunction with the US’ continued attempts at curbing Chinese technological advancement, aiming for stability among global leaders. Although objections were made on behalf of China, ASML remains confident that this will not affect their financial outlook – Japan may soon follow suit with similar export restrictions as well.