Netherlands to Limit Certain Tech Exports Amid US-China Chip War

Netherlands to Limit Certain Tech Exports Amid US-China Chip War
Photo by Anne Nygård / Unsplash

The Lede: The Dutch government plans to impose restrictions on the export of their most advanced microchip technology in an effort to protect national security.

What we know:

  • The rule, expected to be published before summer, will require companies to obtain licenses to export certain technology, including so-called immersion DUV lithography products.
  • The Dutch Trade Minister Liesje Schreinemacher said measures have been taken considering technological developments and geopolitical context and they will affect very specific technologies in the semiconductor production cycle.
  • Netherland-based semiconductor company ASML Holding NV, a key player in the global microchip supply chain, is among the firms that might be affected. The new rule would add restrictions for the firm as the Dutch government has already banned the sale of ASML's most advanced lithography machines used in chip production to China since 2019.
  • In response to the recent move, China has lodged a formal complaint, stating that they hope the Netherlands would not engage in the misuse of export control measures like other countries, indicated to similar restrictions imposed by the United States in October.

The background: Last October the Biden Administration unveiled a broad range of export controls, including a provision to prevent China's access to specific semiconductor chips that are produced globally using U.S. equipment, significantly expanding the scope of the U.S. efforts to restrict China's technological and military progress. But experts thought the measures would be more impactful if the U.S. was joined by its allies. In January, Biden Administration reached a deal with Japan and Netherlands, two nations with headquarters of the world’s largest manufacturers of semiconductor manufacturing equipment, to impose export controls. While the Netherlands has officially announced the decision, Japan is still considering its approach.

Likely outcomes:

  • ASML is the largest tech firm in Europe and the only manufacturer worldwide of specific lithography systems essential for printing patterns of transistors on silicon wafers that have already been subjected to export controls since 2019.
  • Despite added restrictions, ASML does not anticipate that it will have a significant impact on its financial outlook based on the current market situation and the Dutch government's licensing policy.
  • In February, a powerful member of Japan's ruling party revealed to Reuters that Japan could choose to enforce less severe export restrictions on chip manufacturing equipment to China, even though they share the same views on export controls.

The takeaway: As U.S.-China trade competition intensifies, U.S. allies are facing difficulties in reconciling their dependence on China, the world's largest manufacturer, with Washington's concerns about China's access to cutting-edge technology. At the same time, the Biden administration has been pushing them to adopt similar export controls and restrictions to curb China's technological dominance under national security concerns. Japan, one of the closest allies to the U.S. in the Asia-Pacific region, has been grappling with this issue. While the Japanese government agrees with Washington on the need to restrict China's access to advanced technology, similar to the Netherlands, it’s likely to impose export controls that don’t just target one country. Japan may want to not only retain good relations with China but avoid further escalation of the U.S.-China trade competition and potential negative economic impacts.


  • "The Netherlands considers it necessary on national and international security grounds that this technology is brought under control as soon as possible." - Dutch Trade Minister Liesje Schreinemacher.
  • “We disapprove of the Dutch side’s interference through administrative means in the normal trade between Dutch and Chinese businesses and have made démarches to the Netherlands.” - Chinese Foreign Ministry spokeswoman Mao Ning.
  • “Our understanding is that the Dutch announcement does not target a specific country.” - Japanese Trade Minister Yasutoshi Nishimura.

Good Reads:

US-China chip war: Netherlands moves to restrict some tech exports (BBC)

Will Japan impose a milder restriction on chip gear exports or go all out? (TechHQ)

Chip 4 Alliance: Senior officials finally meet to discuss semiconductor supply chain (Tech Wire Asia)