The Dutch government on Friday limited the sale of certain chip-making equipment and machines from ASML to China. This $294 billion contract includes items such as EUV semiconductors and specific types of DUV lithography machines. According to Reuters, the U.S. is also exploring ways to impose further restrictions on this Dutch company. Consequently, ASML must adhere more closely to Washington's regulations than to the Dutch government's in selling its high-end chip-making machines to China. This action by the Netherlands is due to pressures from the U.S. and Japan, and the efforts of U.S. President Joe Biden to restrict Beijing's access to advanced semiconductor technology that could be used for military and artificial intelligence purposes. The new U.S. plan, which may be presented in late July, could prevent the shipment of more types of ASML machines to certain Chinese chip manufacturers, including a facility owned by SMIC, China's largest chipmaker. This new plan targets not only ASML but also other suppliers like Trumpf and Zeiss from Germany, which manufacture lasers and lenses. ASML stated on Friday that the new restrictions from the Dutch government would not affect the final price of the deal. However, it led to a 3.6% drop in the company's stock. ASML has not yet commented on the U.S. plan for further restrictions. The Dutch government's action comes as EU leaders gathered in Brussels to discuss whether cross-border guidelines and national EU export laws could be improved. However, when it comes to chip-making equipment, policies may be dictated from across the Atlantic in Washington. In recent weeks, U.S. threats against ASML have created new challenges for this Dutch company regarding exports to China. To comply with U.S. export regulations, ASML does not hire citizens from certain countries, including Iran, Syria, Cuba, and North Korea, due to the potential access to sensitive U.S. technology in some sectors. In the company's job classifications, around 20 countries, including Russia and China, are considered national security threats to the U.S.
Increased U.S. Pressure to Prevent Sale of Dutch 'Chip-Making Machines' to China
The Dutch government has restricted the sale of advanced chip-making equipment from ASML to China under U.S. pressure. This move is part of a broader strategy by the U.S. to limit China's access to semiconductor technology, which has significant implications for global tech supply chains and geopolitical tensions. ASML's compliance with U.S. regulations also affects its hiring practices regarding certain nationalities.
👥 Key Players
📰 What Happened
The Dutch government has restricted the sale of advanced chip-making equipment from ASML to China under pressure from the U.S. This move is part of a broader strategy to limit China's access to semiconductor technology.
- The contract in question is worth $294 billion and includes advanced semiconductor manufacturing equipment.
- U.S. plans may further restrict ASML and other suppliers from selling to Chinese manufacturers.
💡 Why It Matters
📚 Background
The semiconductor industry is critical for modern technology, and control over its supply chain is a major geopolitical issue, particularly between the U.S. and China.
🏷️ Entities Mentioned
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