Post by : Rameen Ariff

Beijing has announced it will relax the chip export ban it imposed after Dutch authorities took control of Nexperia, a Chinese-owned semiconductor firm based in the Netherlands. The decision comes amid growing international pressure and fears of disruption across Europe’s automotive supply chain.

In September, the Dutch government invoked a Cold War-era emergency law to take over Nexperia, citing “serious governance shortcomings” and concerns over national security. In retaliation, China halted the re-export of Nexperia’s completed chips to Europe, sparking alarm among carmakers and technology firms dependent on semiconductor imports.

Around 70% of chips produced in the Netherlands are shipped to China for processing before being re-exported globally. The sudden halt had threatened to paralyze production lines across Europe, especially within the automotive sector.

In a statement on Saturday, China said it would “comprehensively consider the actual situation of enterprises and grant exemptions to exports that meet the criteria.” However, it did not elaborate on what specific exemptions would be allowed. Beijing also accused the Netherlands of “improper interference in the internal affairs of enterprises,” blaming Dutch authorities for the “current disruption of global production and supply chains.”

The Dutch-controlled Nexperia has since informed its customers that it will stop sending chips to China for processing, according to a letter seen by Reuters. The move has drawn further attention to the global semiconductor tug-of-war involving China, the US, and Europe.

The European Automobile Manufacturers’ Association (ACEA) had previously warned that Nexperia chip supplies would run out within weeks if China did not lift its export ban. “Without these chips, European automotive suppliers cannot build critical parts and components, risking production stoppages,” ACEA stated.

China’s decision to relax export restrictions comes shortly after US President Donald Trump and Chinese President Xi Jinping met in South Korea earlier this week. While Trump confirmed that chip-related trade was discussed, Beijing’s official readout made no direct mention of it.

The White House is expected to issue a fact sheet outlining new trade arrangements between Washington and Beijing, which may include the resumption of Nexperia exports, according to Reuters.

The Nexperia dispute highlights growing tensions in the global chip industry as countries seek to secure domestic supply chains amid geopolitical rivalries. In December 2024, the US added Chinese chipmaker Wingtech to its “entity list” over national security concerns. Meanwhile, in the UK, Nexperia was forced to sell its Newport silicon plant following similar worries raised by British lawmakers.

China’s latest move to ease its export ban signals a cautious step toward stabilizing the global semiconductor market — but experts warn that the long-term uncertainty surrounding chip trade remains far from over.

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