The Dutch government has taken control of the Chinese-owned chip company Nexperia after pressure from Washington, a move underscoring how countries find themselves between the United States and China in the race for technological advantage.
The Nijmegen-based company specializes in low-end chips for consumer electronics, automotive, and industrial sectors and has manufacturing facilities in Germany and the United Kingdom.
On Sunday the Dutch government announced it had taken control of the company. According to Nexperia, its chief executive and shareholder Zhang Xuezheng was removed from his post by court order.
This occurred after American officials warned the Dutch government that Zhang is likely to be replaced so the company could be removed from the list of entities that pose a threat to U.S. national security or foreign policy, according to a court document released on Tuesday.
Entities on the so-called Entity List are subject to U.S. export restrictions.
This sudden move in Amsterdam came amid escalating tension between the United States and China, partly driven by Washington’s expanded export controls announced at the end of September.
The U.S. Department of Commerce significantly expanded the scope of the list, making any subsidiary more than 50% owned by a listed company subject to the same restrictions as the parent. The new rule provided for a grace period through November for several scenarios and affected Nexperia as a 100% subsidiary of Wingtech, a partially state-owned Chinese company that has been on the list since the end of last year.
Reaction and Regulatory Dynamics
Beijing voiced anger over the expansion of U.S. restrictions and last week tightened export controls on rare earth elements, raising the prospect of new tariffs by President Donald Trump.
The Amsterdam Court of Appeal document recalls a June meeting between the Netherlands’ Ministry of Foreign Affairs and the Bureau of International Security and Nonproliferation.
«The fact that the company’s chief executive still has a Chinese owner is problematic», the meeting minutes say, according to the document. «The chief executive will almost certainly have to be replaced to meet the criteria for delisting».
The document also notes that the Dutch Ministry of Economic Affairs told Nexperia about the possibility of introducing the so-called “50%” rule.
In response to CNN’s inquiry about the role of U.S. pressure in the Dutch government’s actions on Wednesday, Nexperia referred to a statement made on Tuesday saying that Nexperia’s operations in Europe are being “damaged in an unacceptable way,” underscoring concerns about chip availability for European industry.
«It is important to stress that this is not aimed at China or Chinese citizens»
CNN also contacted Wingtech and the Ministry of Commerce of China to comment on the role of the United States in the takeover of Nexperia.
Earlier, the Dutch Ministry of Economic Affairs described “serious governance gaps” as the reason for the nationalization of Nexperia, noting that this “extraordinary” measure is aimed at preventing a situation where Nexperia would produce goods that could become unavailable during an emergency.
In a Tuesday statement, Nexperia also noted that government intervention prohibits the company from relocating units and making other decisions without government approval, and will last for a year. The company said it was confident that a resolution could be found within the framework of existing U.S. export restrictions.
China also imposed export controls in early October, banning Nexperia and its affiliated entities from exporting certain components manufactured in China, the company said, adding that it is actively engaging with Chinese authorities to obtain an exemption from these restrictions.
«The Dutch government’s decision to freeze Nexperia’s global operations on the grounds of ‘national security’ is an excessive intervention driven by geopolitical biases, not a well-founded risk assessment»
CNN correspondent Joyce Jiang, based in Beijing, contributed to this piece.
