A bipartisan group of lawmakers introduced a bill in the House of Representatives on Thursday morning that would severely limit the sale of advanced semiconductor manufacturing equipment to China and a selection of other countries, closing what experts say are critical loopholes in America’s AI export controls.
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Led by Rep. Michael Baumgartner, R-Wash., the Multilateral Alignment of Technology Controls on Hardware (MATCH) Act would tighten existing export controls for semiconductor manufacturing equipment — the specialized tools used to create AI chips — if it were to become law. The new restrictions, along with cooperation from allies to implement similar rules, would be likely to curtail China’s ability to build a fully domestic AI supply chain.
China’s imports of semiconductor manufacturing machinery have surged in recent years in tandem with soaring demand for AI chips in China and around the globe. China’s imports of the equipment grew from $10.7 billion in 2016 to about $51.1 billion last year, according to analysis from Silverado Policy Accelerator, a Washington, D.C., think tank that focuses on national security and AI.
“China has made it abundantly clear that it intends to dominate the technologies that underpin both our economy and our national defense,” Baumgartner said in a statement. “The United States cannot afford to leave open back doors that allow the Chinese Communist Party to acquire the tools it needs to leap ahead in semiconductor manufacturing.”
The act would expand the types of chipmaking machines that are banned from being sold to China, further restrict sales of associated services and tools to China’s most important chip companies and engage key allies to implement similarly stringent restrictions to ensure the new rules have global force.
“This is about protecting American workers, American innovation, and American security for the long haul,” Baumgartner said.
The bill, co-sponsored by the chairman of the House Select Committee on China, Rep. John Moolenaar, R-Calif., is the latest move in a yearslong push from officials and experts in Washington to limit the sale of chipmaking machines to China. Export controls on the sale of finished AI chips have also been progressively tightened for years, although the Trump administration has recently allowed exports of certain advanced chips to China.
Sen. Pete Ricketts, R-Neb., and Sen. Andy Kim, D-N.J., are set to introduce a similar bill in the Senate when it is next in session.
A handful of companies make the cutting-edge semiconductor manufacturing equipment needed to produce today’s leading AI chips, and most of them are based in the U.S., the Netherlands and Japan. As a result, semiconductor manufacturing equipment is a critical lever and source of power for the U.S. and its allies in the race to build powerful AI systems.
“China has a stated intent to indigenize its semiconductor industry in the coming years, and what it lacks is the technology and the knowledge to produce the most advanced chips,” said Sarah Stewart, CEO of Silverado Policy Accelerator. “The United States, Japan, the Netherlands and a pocketful of other countries do have that knowledge.”
Chinese leaders have repeatedly singled out chip manufacturing as a pivotal issue for national security. In April, Chinese President Xi Jinping said China should pursue “self-reliance and self-strengthening” for the country’s AI sector and called for renewed “focus on overcoming challenges regarding core technologies such as high-end chips.”
Despite years of similar calls from top Chinese officials and attempts from Chinese companies to create their own chipmaking machines, China’s domestic chipmaking industry remains years behind American, Dutch and Japanese chipmaking abilities, according to experts.
Jeff Koch, a semiconductor manufacturing analyst at SemiAnalysis, a leading AI and chip research firm, said China’s industry lags “more than five years behind in terms of the equipment they’re able to produce” compared with leading Western companies.
Chip designers and manufacturers try to squeeze as much computing power as possible onto each individual chip, fabricated on silicon wafers in a manufacturing process that relies on highly specialized equipment and requires thousands of intricate steps.
One part of the chipmaking process, called lithography, in which fine circuit patterns are transferred to silicon wafers, largely relies on machines from the Netherlands-based company ASML, according to a recent report from the House Select Committee on China.
The U.S. has already implemented a China-wide export ban on the most advanced type of lithography machines, called extreme ultraviolet immersion lithography (EUV), that can manufacture the world’s most advanced AI chips. In May, then-White House AI czar David Sacks said the countrywide restrictions preventing any company within China from obtaining an EUV machine were the “single most important export control” related to AI.
However, previous rounds of export controls allowed sales of older, lower-grade machines that perform deep ultraviolet immersion lithography (DUV), which are capable of manufacturing very advanced — but not the most advanced — chips.
China has acquired hundreds of DUV machines from ASML over the past several years, and China was ASML’s biggest market in the fourth quarter of 2025, representing 36% of net system sales, according to ASML’s figures. With those machines, Chinese chip manufacturers like Semiconductor Manufacturing International Corp. can produce hundreds of thousands, if not millions, of AI chips.
Experts like Stewart of Silverado argue that without stronger controls like those proposed in the bill, DUV tools could allow China to overcome restrictions on its ability to buy the highest-quality chips by simply creating more chips of lower quality, which could yield the same overall amount computing power.
“If we are giving them the ability to scale technology just behind the cutting edge, we are doing as much of a disservice as we are if we just give them the most advanced manufacturing technology,” Stewart said.
At a minimum, the MATCH Act would enact a China-wide ban on the export of DUV machines and tools required to etch the pattern drawn by the machines. The act would also direct the secretary of state and officials in the Commerce Department to identify other critical “chokepoints” within 60 days after the bill’s passage.
The bill would apply the same countrywide restrictions to other countries of concern, including Russia and Iran, though China’s AI industry stands out as the obvious target, according to experts.
Because semiconductor manufacturing supply chains rely heavily on U.S. allies, the bill calls on the U.S. government to exercise “diplomatic engagement” to meet its goals and encourage the Netherlands and Japan to match the restrictions of U.S. export controls.
While the U.S. has previously tried to ensure that companies based in allied countries adopt export controls just as strict as the rules for American companies, the Netherlands and Japan have adopted different standards. Dutch and Japanese semiconductor companies continue to sell their equipment to certain Chinese factories blacklisted under American law, for example.
Because of the allies’ looser rules on exporting semiconductor manufacturing equipment to China, American companies like Applied Materials, KLA Corp. and Lam Research Corp. have progressively lost market share in the semiconductor equipment industry to companies based in the allied countries.
ASML and other ally-based companies, like Tokyo Electron, have also sold services in China to maintain existing machines, while U.S. companies have been prohibited from selling the same solutions. Experts say that servicing has allowed Chinese chip factories to repair broken machines and continue manufacturing powerful chips, while other factories have upgraded their DUV machines to approach EUV levels of performance.
“Allied companies like ASML and Tokyo Electron are still servicing semiconductor manufacturing equipment inside Chinese fabs,” said Michelle Nie, a visiting fellow and AI policy expert at the Center for a New American Security, referring to chipmaking facilities. “Servicing is a major way China gets around the global export control regime, and we’re not adequately restricting it.”
If diplomatic overtures and negotiations do not persuade allies to adopt the same levels of restrictions proposed in the MATCH Act, the bill would direct the Commerce Department to invoke regulatory authorities that would force allies to cut off exports to China.
One of those authorities, known as the foreign direct product rule, allows the Commerce Department to assert that its export control regulations apply to items manufactured in foreign countries when those items are the direct product of or incorporate U.S.-made technology or software. The Commerce Department could contend that U.S. technology underlies the semiconductor manufacturing equipment produced in Japan and the Netherlands and compel the nations to comply through sanctions, but such a unilateral move could risk angering the allies.
“We have to always prioritize moving forward with allies on the most cooperative basis possible,” Stewart said. “If we can’t get to that place of alignment, though, then we do need to have these backstopping tools. Hopefully they are used only as a last resort, but they need to exist.”
The MATCH Act would also enact further restrictions on several key Chinese chipmaking companies and their subsidiaries, including ChangXin Memory Technologies, Hua Hong, Huawei and Yangtze Memory Technologies Corp. The additional restrictions would prohibit those companies from receiving even broader forms of semiconductor manufacturing equipment and associated tooling, a prohibition well beyond the proposed countrywide ban on equipment used for advanced chips.
A House Select Committee on China report in October called semiconductor manufacturing equipment the “forges of the future” and a “crucial chokepoint [that] must be preserved, not squandered.”
Like the U.S. military, China’s military is embracing AI to improve tactical decision-making and the precision of its operations. By limiting the sale of semiconductor manufacturing equipment to China, the U.S. could shrink the number of chips available to China’s military and its advanced weapons systems.
American politicians have been hesitant to pass legislation targeting China’s chipmaking industry in past years, both because the world’s economy is already so reliant on older generations of chips often made in China and because China could react strongly to attempts to constrain its advanced chipmaking abilities.
After it was reported that the U.S. was preparing new export controls on chip toolmakers in late 2024, China’s Foreign Affairs Ministry spokesperson, Lin Jian, said: “China firmly opposes the U.S.’s overstretching the concept of national security, abusing export controls and maliciously blocking and suppressing China.” In response to the moves to constrain China’s AI capabilities, China cut off America’s access to critical minerals needed for a variety of high-tech industries.
“The U.S. prohibiting export of all those DUV tools to China is a pretty serious escalation,” said Koch of SemiAnalysis. “This would be a very serious strategic impact for China, since they see semiconductor manufacturing equipment as a critical strategic need. I would expect them to react.”
The House’s MATCH Act is co-sponsored by a growing coalition of representatives, including Rich McCormick, R-Ga.; John Mannion, D-N.Y.; and Maggie Goodlander, D-N.H.
Saif Khan, an expert on semiconductor manufacturing equipment and a former official at the National Security Council and the Commerce Department, said the MATCH Act would address critical loopholes threatening America’s AI command: “America’s advantage in AI computing power over China, driven by the ability to produce large volumes of the most powerful AI chips, is the linchpin of its leadership in AI.”
“Export controls on chipmaking equipment have already dramatically decreased the quality and quality of competing AI chips China can produce domestically,” Khan told NBC News. “The MATCH Act would close key remaining gaps in those controls, strengthening the long-term U.S. advantage in AI.”
