US Convinced Netherlands to Cancel Export License for Semiconductor Sale to China, Report Says

The Trump administration successfully persuaded the Dutch government to not renew an export license for a Dutch chip manufacturer, which was poised to sell the technology to China, according to a Jan. 6 Reuters report. The administration “mounted an extensive campaign” to block the sale, which included lobbying from Secretary of State Mike Pompeo and White House officials, who shared “classified intelligence” with the Netherlands’ prime minister, Reuters said. The campaign began in 2018 after the Netherlands granted an export license to ASML, a semiconductor equipment company, to sell “its most advanced machine” to a Chinese customer.

The campaign lasted several months as U.S. officials “examined whether they could block the sale outright,” Reuters said, and included at least four rounds of talks with Dutch officials. Shortly after a July 2019 White House visit by the Netherlands’ Prime Minister, the Netherlands decided not to renew the license, according to the report. The “$150 million machine” has not been exported, Reuters said. Reuters said reports indicate the Chinese customer is Semiconductor Manufacturing International Corp., China’s “biggest chip-making specialist.”

The campaign came as the U.S. seeks to restrict sales of certain emerging and foundational technologies to China, which will include certain semiconductor technology (see 1912160032). The U.S. is also considering expanded restrictions on foreign shipments to Huawei that contain U.S. technologies (see 1912100033). The U.S. has added Huawei (see 1911180036) and 28 Chinese companies and entities (see 1910070076) to the Commerce Department’s Entity List, which places restrictions on U.S. exports.