Netherlands Responds to US China Policy With Plan to Curb Semiconductor Tech Exports
The U.S. in October imposed sweeping export restrictions on shipments of American chipmaking tools to China, but for the restrictions to be effective, they need other key suppliers in the Netherlands and Japan, who also oversee key chipmaking technology, to agree. The allied countries have been in talks on the matter for months.
Dutch Trade Minister Liesje Schreinemacher announced the decision in a letter to parliament, saying the restrictions would be introduced before the summer.
Her letter did not name China, a key Dutch trading partner, nor did it name ASML Holding NV, Europe's largest tech firm and a major supplier to semiconductor manufacturers, but both will be affected. It specified one technology that would be affected: "DUV" lithography, the second-most advanced machines that ASML sells to computer chip manufacturers.
"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," the letter said.
ASML said in a response it expected to have to apply for licenses to export the most advanced segment among its DUV machines, but that would not affect its 2023 financial guidance.
ASML dominates the market for lithography systems, multimillion-dollar machines that use powerful lasers to create the minute circuitry of computer chips. The company expects sales in China to remain about flat at $2.3 billion in 2023 - implying relative shrinkage as the company expects overall sales to grow by 25%. Major ASML customers such as Taiwan Semiconductor Manufacturing Co. and Intel are engaged in capacity expansion.
ASML has never sold its most advanced "EUV" machines to customers in China, and the bulk of its DUV sales in China go to relatively less advanced chipmakers. Its biggest South Korean customers, Samsung and SK Hynix, both have significant manufacturing capacity in China.
The Dutch announcement leaves major questions unanswered, including whether ASML will be able to service the more than $8 billion worth of DUV machines it has sold to customers in China since 2014.
Schreinemacher said the Dutch government had decided on measures "as carefully and precisely as possible ... to avoid unnecessary disruption of value chains."
"It is for companies of importance to know what they are facing and to have time to adjust to new rules," she wrote.
Japan is expected to issue an update on its chip equipment export policies as soon as this week.