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Dutch Prime Minister Mark Rutte speaks with US President Joe Biden, on June 29, 2022. The United States has been pressuring the Netherlands to block the export of high-tech semiconductor equipment to China.
Susan Walsh | AFP | Getty Images
The Netherlands on Friday announced new export restrictions on advanced semiconductor equipment amid US pressure to cut off China from key chipmaking tools.
The Dutch government said companies in the Netherlands will need to apply for a license to export some advanced semiconductor manufacturing equipment abroad, under rules that will take effect on Sept. 1.
The Netherlands is the home of ASML, one of the most important semiconductor companies in the world. ASML It manufactures the machinery required to make the most advanced chips.
ASML shares fell 1.5% on Friday.
Last October, the United States introduced sweeping rules aimed at cutting off exports of key chips and semiconductor tools to China, a move that analysts said could hamper Beijing’s ambitions to boost its domestic technology. Since then, the US has been ramping up pressure on major chip-makers and allies like the Netherlands and Japan, to enforce their own export restrictions.
Because of ASML’s critical role in the advanced chips, Washington sought to put the Netherlands on a par. The Dutch government was neutral but in March placed restrictions on the export of advanced semiconductor equipment. Friday’s announcement ends those rules and gives more clarity about what can and cannot be exported.
The law does not specify any country and does not explicitly name ASML.
The Dutch government said the rules apply to “a number of very specific technologies for advanced semiconductor development and manufacturing” that could be used in places such as military applications.
Dutch Trade Minister Lesje Schreenmacher said: “We took this step for reasons of national security. It is good for the companies that will be affected to know what they can expect. This will give them the time they need to adjust to the new rules.” in the current situation.
ASML caught in the middle
ASML machines are used by advanced chip manufacturers such as TSMC. There are two main tools that you make.
The first is the so-called immersion ultraviolet (DUV) lithography machine, which is used to manufacture memory chips. These chips are used in a wide number of devices, from smartphones to laptops and servers, and can eventually be used for AI applications.
The second is called an extreme ultraviolet (EUV) lithography machine which is used to make more advanced chips.
ASML said it will now need to apply for a license to export its most advanced DUV immersion lithography system, called TWINSCAN NXT: 2000i and later tools.
The Dutch government has used a different set of rules to restrict exports of ASML EUV devices since 2018. However, EUV exports will be subject to the law that takes effect in September.
ASML said it could begin offering export licenses before the law goes into effect and the government would grant or deny those applications on a case-by-case basis.
The company added that it does not expect the measures announced on Friday to have a material impact on its financial outlook for 2023.
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