China's Chip Dreams Shattered: How New Dutch Export Controls Could Impact the Global Tech Industry

The Netherlands has recently announced a significant expansion of its export controls to China, with a specific focus on chip-making tools. As part of the new regulations, companies like ASML, a leading manufacturer of chip-making equipment, will need to obtain a licence to service certain equipment in China.

The move has sparked a strong reaction from China, which has described the new rules as the result of "coercion" and accused the Dutch government of bowing to pressure from the United States. The Dutch government, however, has stated that the new regulations are designed to ensure that sensitive technology is not used for military purposes.

ASML, which is based in the Netherlands, is one of the world's leading suppliers of lithography machines, which are used to make the complex semiconductors found in a wide range of modern electronics. In recent years, the company has been at the centre of tensions between China and the United States, with both countries seeking to gain an advantage in the field of semiconductor manufacturing.

The new export controls, which came into effect on September 7, will restrict the export of certain chip-making tools to China, including deep ultraviolet (DUV) lithography machines. These machines are critical for the production of advanced semiconductors, and are seen as essential for the development of cutting-edge technologies like artificial intelligence and 5G networks.

The Dutch government has stated that the new regulations will not only apply to new exports, but also to existing equipment that is already in use in China. This means that ASML will need to obtain a licence to service certain equipment in China, which could have significant implications for the company's business in the region.

The new regulations have been welcomed by the United States, which has been seeking to limit China's access to advanced semiconductor technology. The US has argued that China is seeking to use this technology for military purposes, and has imposed its own restrictions on the export of certain chip-making tools to China.

However, the move has also been criticized by some, who argue that it will have a negative impact on the global semiconductor industry. The industry is highly interconnected, and the new regulations could disrupt supply chains and make it harder for companies to access the technology they need.

The move is also seen as part of a wider trend of increasing tensions between China and the West over access to advanced technology. As countries seek to gain an advantage in the field of semiconductor manufacturing, we can expect to see more restrictions and regulations on the export of sensitive technology.