Dutch curb chip equipment exports amid US pressure

AMSTERDAM - The Dutch government on Friday announced new rules restricting exports of certain advanced semiconductor equipment, a move that comes as the US pressures its allies to curb sales of high-tech components to China.

“We have taken this step in the interest of our national security,” said Trade Minister Liesje Schreinemacher, adding that such equipment may have military uses.

Ms Schreinemacher said only a “very limited” number of companies and product models would be affected. China was not named.

Dutch company ASML, a key equipment supplier to computer chip makers, said in reaction that it would not change its financial guidance as a result of the new rules.

The rules, which will require companies that make advanced chipmaking equipment to seek a licence before they can export it, are set to take effect on Sept 1. A technical document specifying which equipment will require a licence accompanied the announcement.

The introduction of the list is the result of a high-level deal between the United States and two allies with strong chip equipment industries – the Netherlands and Japan – to tighten curbs as Washington seeks to hobble Beijing’s ability to make its own chips.

China “firmly” opposes the Dutch government’s new rules and urges the country to immediately correct its wrongdoings, the Chinese Embassy in the Netherlands said on Friday.

“Setting up barriers in the field of science and technology has no legal or moral basis,” an embassy spokesman said in a statement.

China is ready to work with the Dutch side to address the issue based on the principle of mutual benefit, the spokesman added.

ASML, Europe’s largest technology company, repeated a March statement indicating the top section of models of its second most advanced “DUV” product line, which are used to make computer chips, would need a licence.

It named its 2000 series “and subsequent” models and said it did not expect the rules to have a material impact on its financial forecasts. ASML’s most advanced EUV machines have never been shipped to China.

ASML’s shares were down 3.6 per cent after the news, while smaller rival ASM International dipped 1.8 per cent.

Washington in October imposed curbs on exports of American chipmaking tools to China from US firms like Lam Research and Applied Materials on national security grounds, and lobbied other countries with key suppliers to do the same.

Reuters reported on Thursday that the US may introduce additional rules in July, which could affect another, slightly older model of ASML machines. All ASML machines, which can cost up to US$200 million (S$271 million) each, contain US technology.

Ms Schreinemacher said she expected about 20 licence applications on an annual basis, representing a “limited part of the total product portfolio of the companies that fall under this rule”.

ASML has been restricted from selling EUV machines without a licence under an international agreement known as the Wassenaar Arrangement, but the Dutch rules now make clear they cover EUV machines also.

European Union countries share a common trade policy and generally use the Wassenaar Arrangement to determine which exports are restricted on security grounds.

The new Dutch list published may later be adopted by other European countries or added to the EU list, though few other European countries export high-end chipmaking equipment.

German manufacturers supply essential parts to ASML, including lasers made by Trumpf and lenses made by Zeiss, among others. REUTERS