The US wants the Netherlands to cut ASML chip exports to China


The US is pushing the Netherlands to ban ASML from selling mainstream technology to China, which is essential to making a large chunk of the world’s chips, and is expanding its campaign to stem the country’s rise, according to people familiar with the matter.

Ashington’s proposed restriction would extend an existing moratorium on sales of the most advanced systems to China, in a bid to thwart China’s plans to become a world leader in chip manufacturing. If the Netherlands agrees, it would greatly expand the range and class of chipmaking equipment currently banned from being shipped to China, potentially dealing a major blow to Chinese chipmakers from Semiconductor Manufacturing International to Hua Hong Semiconductor.

American officials are lobbying their Dutch counterparts to block ASML from selling some of its older deep ultraviolet lithography, or DUV, systems, the people said. These machines are a generation behind, but are still the most common way to make certain less advanced chips needed by cars, phones, computers, and even robots.

ASML’s American Depositary Receipts extended losses as much as 8.3 percent, the largest intraday decline since March 2020, according to Bloomberg’s initial report.

The issue arose during US Assistant Secretary of Commerce Don Graves’ visit to the Netherlands and Belgium in late May and early June to discuss supply chain issues, said the people, who asked not to be named because the talks were private . During this trip, Graves also visited ASML’s headquarters in Veldhoven and met Chief Executive Officer Peter Wennink.

The Dutch government has yet to agree to any additional restrictions on ASML exports to Chinese chipmakers, which could affect the country’s trade ties with China, the people said. ASML is already unable to ship its most advanced extreme ultraviolet or EUV lithography systems, which cost around €160 million per unit, to China due to its inability to obtain an export license from the Dutch government.

The US push on ASML comes as President Joe Biden separately considers easing some of the Trump-era tariffs on consumer goods from China. While China may welcome such a move at a time of strained relations between the two powers, Biden’s administration has continued his predecessor’s efforts to restrict China’s access to US technology.

The US Department of Commerce and the Dutch State Department declined to comment.

“The discussion is not new. No decisions have been made and we do not want to speculate or comment on rumours,” said an ASML spokeswoman.

ASML is the world’s leading manufacturer of lithography systems, machines that perform a critical step in the semiconductor manufacturing process. ASML’s dominance of this type of equipment means that further foreclosure of China from access to its products would undermine the country’s ambitions to become more self-sufficient in the production of crucial electronic components. The US wants the Netherlands to cut ASML chip exports to China

Fry Electronics Team

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