The Dutch government has directed ASML to limit the export of certain chip-making equipment to China, the company confirmed on Monday. This move follows increased restrictions by the United States on the kinds of semiconductors American firms can sell to China, in addition to urging allies to implement their own constraints.
ASML, a maker of semiconductor production equipment based in the town of Veldhoven in the Netherlands, said in a statement that its “license for the shipment of NXT:2050i and NXT:2100i lithography systems in 2023 has recently been partially revoked by the Dutch government,” and the decision would impact “a small number of customers in China.”
ASML, renowned for its expertise in creating lithography machines that employ light to imprint patterns on silicon, plays a vital role in the mass production of microchips. These power a wide range of devices, from phones to washing machines.
As it holds a dominant position in the market, experts often refer to ASML as an indicator of the escalating divide between China and the West over access to high-end technology.
The Dutch government has experienced years of pressure from the US to curtail chip-related exports to China. In October, the Biden administration extended a set of broad export controls first implemented in 2022. ASML noted that due to the extensive and complex nature of the regulations, it would need to thoroughly evaluate any potential implications.
ASML’s CEO, Peter Wennink, indicated in an earnings call in October that the revised export restrictions could impact between 10% and 15% of the firm’s Chinese sales.
Following discussions with the US government, the company stated on Monday that it had obtained a better understanding of the scope and ramifications of the US export control regulations.
However, the company does not foresee the recent revocation of its export license or the latest US export control constraints to have a substantial effect on its financial outlook for 2023, ASML added.
Responding to the US curbs on Tuesday, China labeled them as “hegemonic” and “bullying”. Wang Wenbin, the Foreign Ministry spokesperson, warned that these actions will “destabilize the global semiconductor landscape” and “will only backfire against the US”.
Wang also appealed to the Netherlands to “protect the mutual interests of businesses from both countries with tangible action”, and to ensure a “non-discriminatory business environment.”
