Chinese chipmaker taken over by the Dutch government. In the background “a threat to Europe's technological security”

The Dutch government has taken control of the Chinese chipmaker Nexperia, based in Nijmegen, the Netherlands, pointing to a threat to Europe's technological security. As part of the decision, the company's president was suspended.

In a statement published on Sunday, the Ministry of Economy said that the decision was made after the ministry recently noticed “clear signals of serious shortcomings and management actions” at Nexperia.

According to the ministry, they indicate a threat to the technological capabilities of the Netherlands and Europe, which in turn poses a risk to their economic security.

This used the 1952 Availability of Goods Act, which allows The Hague to intervene in the activities of private companies to guarantee access to critical products in the event of a crisis.

As part of these activities, The Hague gained the right to block or reverse decisions of the company's management board. Under the act, Zhang Xuezheng was suspended as the company's president and the company's shares were placed under the control of an external trustee.

Nexperia? It is a former Dutch concern

Nexperia was established after its separation from the Dutch concern NXP Semiconductors. In 2019, the Chinese technology company Wingtech became the majority owner of the company.

The company criticized the decision of the Dutch government, describing it as “an act of excessive interference motivated by geopolitical reasons and not based on risk assessment”, and announced an appeal to the court.

Wingtech was previously on the U.S. list of export-restricted entities, which hinders its access to advanced semiconductor technologies.

Union: Protecting security is a priority

On Monday, the European Commission also commented on the matter, emphasizing that with the decision regarding Nexperia, the government in The Hague responded to the potential risk to the economic security of the Netherlands and Europe.

– Protecting technological security is a priority of the EU's economic security strategy. We will continue to be in contact with the Dutch authorities, and in parallel we are looking at further possible steps, said EC spokesman Olof Gill.

The actions of the Dutch government are another installment of the deepening technological competition between China and the West. Last week, Beijing announced new export controls on rare earth technology and products that could hit key economic sectors including the automotive and defense industries. (PAP)

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