Using ASML Tools, China Seeks Military

(CTN News) – ASML (ASML.AS) has been denied export licences due to concerns that its computer chip equipment may be used for Chinese military purposes, the Dutch trade minister has stated in response to parliamentary questions.

One of the world’s largest tech companies, ASML, is a Dutch company that dominates the market for lithography systems, which help to create circuitry for computer chips.

To promote self-sufficiency in its military-technical development, China draws on foreign expertise, including Dutch expertise in lithography, noted Trade Minister Geoffrey van Leeuwen in a note sighted by Reuters on February 5.

Van Leeuwen stated that ASML’s tools are used to make advanced semiconductors for high-value weapons systems and weapons of mass destruction, and the Dutch government is concerned about “the risk of undesirable end uses” when reviewing export license applications.

A licensing requirement was introduced by the Dutch government last year as a result of pressure from the United States. It is the company’s most advanced tools that have never been sold in China. As a result of questions posed by lawmaker Femke Zeedijk of the reformist NSC party, The government was asked why it initially granted, and then quickly retracted,

A license to ASML for the export of several tools to undisclosed customers in China.

These tools have been sold to Chinese customers in the past few years for hundreds of millions of euros.

According to Van Leeuwen, several licenses have already been granted for the export of advanced semiconductor equipment to China since the licensing requirement was instituted in September, and the company anticipates around 20 such requests in the coming months.

As predicted by industry group SEMI, 18 Chinese chip plants are expected to go online this year, more than any other region.

Zeedijk’s questions, including whether the Netherlands had revoked the licenses at the request of the U.S. government, were unanswered.

On Monday, Zeedijk told Reuters: “I do not say there are no security concerns or that the decision was incorrect, but I would like to be better informed.”

According to the perception, there are also economic reasons behind the decision as well as the security risk.

Despite the cancellations, ASML’s fourth-quarter earnings did not suffer, but the Deep Ultraviolet (DUV) tools in question would have cost approximately $60 million each.

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