Written by Toby Sterling
AMSTERDAM (Reuters) – Concerns that ASML’s computer chip equipment could be used for Chinese military purposes were at the root of a recent decision to deny the company an export license, the Dutch trade minister said in response to a parliamentary question. He said there is.
Netherlands-based ASML, Europe’s largest technology company, dominates the global market for lithography systems needed by computer chip makers to create circuits.
“China is focusing on foreign expertise, including Dutch expertise in the field of lithography, to promote self-sufficiency in military technology development,” Trade Minister Geoffrey van Leeuwen said in a statement obtained by Reuters. I am writing this in a memo dated May 5th.
Van Leeuwen said ASML tools are used to manufacture advanced semiconductors that could be used in “high-value weapons systems and weapons of mass destruction,” and the Dutch government will review export licensing decisions. It said it was focusing on “risks of undesirable end uses.”
Following pressure from the US, the Dutch government last year introduced licensing requirements for ASML’s mid-range DUV machines. The company’s cutting-edge tools are not sold in China.
The question, posed by lawmaker Femke Zedijk of the reformist NSC party, asked why the government initially granted and then quickly withdrew a license to ASML to export some tools to an undisclosed customer in China. . The company has sold hundreds of millions of euros worth of such tools to Chinese customers in recent years.
Van Leeuwen’s answer sidestepped that question, adding that since the licensing requirements were introduced in September, “several licenses have been granted for the export of advanced semiconductor equipment to China.” He said he expected a total of about 20 similar requests this year, but he declined to say how many would come from China.
About 18 chip factories in China are expected to open this year, more than in any other region, according to forecasts from industry group SEMI. Many Chinese chipmakers are focusing on manufacturing older generations of chips and using equipment that does not fall under export control policies.
Some of Zeedijk’s questions remained unanswered, including whether the Netherlands had revoked its license at the request of the U.S. government.
“I’m not saying there aren’t security concerns or that this decision was wrong, but I would like to know more information,” Zeedijk told Reuters on Monday.
“Besides the security risks, there is also a recognition that there are economic reasons behind it.”
Following a report from Bloomberg News, ASML confirmed on New Year’s Day that the Dutch government had revoked its license.
The resulting cancellation did not affect ASML’s fourth-quarter earnings, but the deep ultraviolet tools in question cost about $60 million each and will be a key part of customer plans.
ASML said in January that sales to China were unusual in 2023 but expected to remain “strong” in 2024. The company said it does not plan to ship more advanced tools than the NXT:2000i to China under the Dutch licensing regime, and due to U.S. regulations its NXT:1970 and NXT:1980i product lines are limited to “a small number of announced that it cannot be exported to factories in China.
(Reporting by Toby Sterling; Editing by Susan Fenton and Lisa Shoemaker)