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ASML export licence revoked over China military fear

Dutch Minister of Foreign Affairs and Minister of Foreign Trade, Geoffrey van Leeuwen, has expressed fears that ASML’s chipmaking equipment will be used for military purposes in China. Which is why the minister has decided to deny the company an export licence

ASML is, as known by most in the industry, one of the most important European companies in the semiconductor ecosystem. The company dominates the market of lithography systems.

"China focuses on foreign expertise, including Dutch expertise in the field of lithography, to promote self-sufficiency in its military-technical development," Trade Minister Geoffrey van Leeuwen wrote in a Feb. 5 note, seen by Reuters.

The Trade Minister continued to state that the systems from ASML are used to make advanced semiconductors which can be utilised in "high-value weapons systems and weapons of mass destruction".

Evertiq has previously reported that the Dutch government, following pressure from the US, introduced a licensing requirement for ASML's mid-range DUV machines. The company's most advanced tools have however never been sold in China.

Boosted by government funding and other incentives, China is expected to increase its share of global semiconductor production. Chinese chip manufacturers are forecast to start operations of 18 projects in 2024, as reported by SEMI. However, many Chinese manufacturers are focusing on mature technologies – utilising equipment that does not fall under export control rules.

In November 2023, Chinese customs authorities reported a 1050% surge in the import value of lithography equipment from the Netherlands, according to the South China Morning Post. The publication suggests that the Netherlands has managed to remain a viable channel for ordering advanced equipment for China despite the restrictions imposed by the US.

The data revealed that China imported 16 lithography equipment units from the Netherlands, valued at USD 762.7 million, in the month. This represented a tenfold year-on-year increase.

Following a report by Bloomberg, ASML confirmed on New Year's Day the Dutch government had indeed revoked a licence.

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June 13 2024 1:49 pm V22.4.55-2