The U.S. and the Netherlands are expected to hold a new round of talks this month over restricting China’s access to advanced chip technology, according to Bloomberg, during which the U.S. will increase pressure on its allies to block ASML supplies to China.
Tarun Chhabra, a senior U.S. National Security Council official, and Alan Estevez, the undersecretary of commerce for industry and security, will travel to the Netherlands for discussions, according to people familiar with the matter.
The two sides will discuss expanding export controls as the United States has been pressuring the Dutch government to stop selling a wider range of advanced chip-making machinery to China, people familiar with the matter said, although they do not expect a deal. The visit is part of ongoing bilateral negotiations that will also discuss other issues in the U.S.-Dutch technology partnership, according to a person familiar with the matter.
The U.S. National Security Council, the U.S. Department of Commerce and the Dutch Ministry of Foreign Trade and Development Cooperation all declined to comment.
ASML no longer sells its cutting-edge extreme ultraviolet (EUV) lithography systems in China, but the U.S. has been pushing for the ban to be extended to more mature technologies.
ASML is the linchpin of the $550 billion global chip industry, the one-of-a-kind machine maker without which state-of-the-art semiconductors cannot be made, and Washington needs this company to put maximum pressure on China.
The global chip equipment market is dominated by three U.S. suppliers -- Applied Materials Inc., Lam Research Corp. and KLA Corp. -- as well as Netherlands-based ASML and Japan's Tokyo Electronics Co., Ltd.
While non-U.S. companies have more latitude in doing business with China than their U.S. counterparts, they are all subject to strict regulatory restrictions that limit what they can sell to Chinese customers. The gap has widened after Washington introduced new rules on Oct. 7 that further restrict the ability of U.S. equipment suppliers to do business in the country.
ASML has been unable to obtain approval from the Dutch government to sell its state-of-the-art EUV machines to China, but so far it can continue to sell its other products to Chinese customers and is less affected by new U.S. export controls than its U.S. counterparts.
U.S. officials have said their latest round of trade restrictions will lapse over time if allies do not join the movement. They have also been pushing ASML to stop selling immersion lithography machines to China, the second most advanced product after EUV, Bloomberg reported earlier this year.
The U.S. Commerce Department's Estevez said last week that he expected to reach a deal with global allies that would limit exports of chip-making equipment to China in the short term.