ASML Suspends Some China Exports

The Dutch company ASML, which specializes in the manufacture of equipment for the production of chips, announced an order received from the Netherlands government to stop supplying some of its products to China.

ASML Suspends Some China Exports

The mentioned firm published a corresponding statement last Monday, January 1. Restricting the supply of some chip manufacturing equipment produced by a Dutch company is a kind of continuation of the United States policy aimed at banning the export of certain types of semiconductors that American brands can sell in the Chinese market. The media notes that Washington is calling on its allies to join a similar practice. The order received by ASML indicates that the Dutch government has decided to follow the American strategy of reducing trade with China.

The mentioned chip production equipment manufacturer, based in Veldhoven, reported in a statement released on Monday that the license for the supply of NXT:2050i and NXT:2100i lithographic systems in 2023 was partially revoked by the government. Separately, the company noted that this decision will affect a small number of its customers living in China.

ASML has a kind of master status in creating lithographic machines that use light to print patterns on silicon. This equipment is crucial in the sphere of mass production of chips, applied in many devices, including mobile phones, and also artificial intelligence systems, which some experts identify as the driving force behind the technological transformation of the world.

ASML is the industry leader in the manufacturing of equipment for making microcircuits. The company found itself at the epicenter of a deepening rift between China and the West, due to Beijing’s limited access to advanced technologies.

For several years, the Dutch Government has been under pressure from the United States. In this case, Washington’s insistent calls for limiting the supply of chips to China are implied.

In October, the administration of United States President Joe Biden tightened export controls. In a practical sense, this decision means expanding the list of technological products whose supplies to China are limited. The October measures are a continuation of the partial export ban policy against Beijing, which Washington began implementing in 2022.

ASML, after the administration of the American president imposed restrictions on the supply of chips and equipment necessary for these goods production, stated that due to the length and complexity of the relevant rules, it needs to carefully assess any potential consequences of these measures. Peter Wennink, the company’s chief executive, noted during an earnings call in October that the new export regulations would affect 10% to 15% of the firm’s sales in the Chinese market.

On Monday, ASML also reported that after discussions with the United States government, additional clarifications were received on the scope and impact of the rules for the external supply of products approved by Washington. The company assumes that the current revocation of its export license or restrictions on trade with China imposed by the United States will not significantly affect its financial prospects.

Beijing on Tuesday, January 2, described Washington’s supply restrictions as bullying and hegemonic. The spokesperson of the Chinese Ministry of Foreign Affairs, Wang Wenbin, said that these actions cause widespread harm to the global semiconductor market, noting that export control measures will backfire against the United States. He also called on the Netherlands to protect the common interests of businesses from both countries and ensure a non-discriminatory business environment.

As we have reported earlier, Samsung and ASML to Invest in Chip Plant in South Korea.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.