The Dutch government confirmed for the first time Wednesday it will impose new export controls on microchips manufacturing equipment, bowing to U.S. pressure to block the sale of some of its prized chips printing machines to China.
The U.S. and the Netherlands reached an agreement to introduce new export restrictions on advanced chip technology to China at the end of January, but until now, the Dutch government hadn’t commented publicly on it. The deal, which also included Japan, involves the only three countries that are home to manufacturers of advanced machines to print microchips. It is a U.S.-led initiative to choke off the supply of cutting-edge chips to China.
“Given the technological developments and geopolitical context, the government has concluded that it is necessary for the (inter)national security to expand the existing export controls on specific manufacturing equipment for semiconductors,” Foreign Trade Minister Liesje Schreinemacher wrote in a letter to Dutch lawmakers published Wednesday evening.
The Dutch government wants to prevent Dutch technology from being used in military systems or weapons of mass destruction, Schreinemacher wrote — echoing the U.S. reasoning when it imposed its own export controls in October. The Netherlands also wants to avoid losing its pole position in producing cutting-edge chip manufacturing tools: Schreinemacher said the government wants to uphold “Dutch technological leadership.”
While China is not explicitly named in Schreinemacher’s letter, the new policy is targeted at Chinese efforts to overtake the U.S. and others like Taiwan, South Korea, Japan and leading European countries in the global microchips supply chain.
The new export restrictions deal a blow to ASML, the global leader in producing advanced microchips printing machines based in Veldhoven, in southern Netherlands.
In the letter, Schreinemacher said the new export control measures include the most advanced deep ultraviolet (DUV) machines, which are part of ASML’s advanced chips printers portfolio. The Dutch firm, which is the highest-valued tech company in Europe, already did not receive export licenses for selling its most advanced machines using extreme ultraviolet light (EUV) technology to China since 2019.
ASML in a statement confirmed it will now “need to apply for export licenses for shipment of the most advanced immersion DUV systems,” but it noted it has not yet received more details about what “most advanced” means.
The company’s financial outlook for 2023 has not changed. China accounts for 18 percent of the company’s order book, its Chief Financial Officer Roger Dassen told POLITICO at the end of January.
The Dutch government said they will push to have new export controls included in the context of the so-called Wassenaar Arrangement next, a multilateral body where 42 participating countries agree on export controls for conventional arms and dual-use goods, which can have both civil and military applications.
Russia, however, is still a member of Wassenaar and The Netherlands acknowledged Moscow can block the proposal. For that reason, the Dutch government said it will also establish its own national export control list, which can be copied by other EU members. That list should be ready before the summer.
