Netherlands in talks with US on China chip policy

Dutch trade minister Liesje Schreinemacher said on Friday the Netherlands is in talks with the U.S. government about new export restrictions for semiconductor equipment to China.

Under pressure from the U.S., the Dutch government has since 2018 not allowed the country’s largest company, semiconductor equipment maker ASML Holdings NV, licenses to ship its most advanced machines to China because they are considered “dual use” equipment with potential military applications.

New U.S. export restrictions on chip equipment announced in October reach beyond currently agreed international definitions of what constitutes dual-use equipment.

“Well we are having talks with the U.S., obviously they have announced their unilateral measures,” Schreinemacher told reporters in Brussels.

“I cannot really comment on what would be acceptable for the Netherlands. Obviously we are weighing our own interests. Our national security interest is of the utmost importance.”

While ASML machines are made in Europe with few U.S. parts, U.S. Commerce Secretary Gina Raimondo on Nov. 3 said she expects allied countries including the Netherlands to follow U.S. policy.

“We do share the concerns that they (the U.S. government) have when it comes to China, when it comes to security,” Schreinemacher said.

“Already our companies are being harmed by that (previous) export restriction, but I believe for the right reasons, as I said before, because of national security interests.”

ASML had more than 2 billion euros ($2.08 billion) of sales to China in 2021, or about 16% of its total. On Nov. 11, CEO Peter Wennink downplayed the impact of a potential complete export ban, saying it would not impact ASML growth through 2030 if it happened.

At the G20 conference in Bali, Chinese President Xi Jinping called on Dutch Prime Minister Mark Rutte to resist “the politicisation of economic and trade issues.” Reuters