Dutch Government Set to Comply With US Demands on Chip Exports to China

By Jace Dela Cruz

Apr 08, 2024 03:33 AM EDT

The United States demand that the Dutch chip giant ASML stop servicing several pieces of equipment it has sold to Chinese customers is a diplomatic and business challenge for the Dutch government.

However, the country is reportedly set to comply with the US demand to tighten restrictions on semiconductor-related exports to China.

An employee walks past an ASML logo, a Dutch company which is currently the largest supplier in the world of semiconductor manufacturing machines via photolithography systems in Veldhoven on April 17, 2018.
(Photo : EMMANUEL DUNAND/AFP via Getty Images)

Dutch Government Set to Adhere to US Demands on Chip Restrictions

Reuters reported that while the Dutch administration, led by Prime Minister Mark Rutte, has not yet made a definitive decision, signs continue to align with the US on export restrictions, especially concerning China.

The potential reluctance to approve maintenance requests from Chinese clients could hinder China's ambitions to bolster its domestic chip industry, given that ASML's equipment is essential and challenging to substitute.

However, such a stance could also complicate the government's efforts to stop ASML, the Netherlands' biggest company, from relocating its operations abroad.

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Dutch Support for Ukraine Against Russia

Reuters reported that one crucial aspect influencing Dutch policy decisions is its security interests, particularly its support for Ukraine in its conflict with Russia.

Rutte, who is favored to become the next NATO secretary-general, discussed ASML's situation with Chinese President Xi Jinping during a recent meeting in Beijing, expressing concerns about China's alignment with Russia.

The Netherlands holds Russia accountable for the downing of Malaysia Flight 17 (MH17) and supports the International Criminal Court's efforts to prosecute Russian officials for war crimes related to the Ukraine conflict.

According to Reuters, Rutte urged China to prevent Russia from acquiring "dual-use goods" with civilian and military applications, like ASML's machines and the chips they make.

While Rutte's statements do not translate to a policy of presumptive denial for Chinese customers looking for ASML products that fall under licensing rules, as US policy does, they indicate the Dutch government's possible starting point.

READ MORE: Dutch Government Is Working to Stop ASML From Leaving Amid Immigration Policy Concerns

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