Pressuring allies not to fulfill chip kit service contracts with China now official US policy

Xi Jinping warns 'no force' can stop country's science and tech progress

The US government has publicly confirmed it is applying pressure on chipmaking tool suppliers based in allied nations – think ASML and the like – to halt maintenance of kit already sold to China.

"We are pushing for not servicing these key components, so these are discussions we're having with our allies," Under Secretary of Commerce for Industry and Security Alan Estevez told the media during a briefing in Washington.

In effect, the administration is asking others to force their own companies to break binding contractual agreements they have entered into with customers in China to curb semiconductor advances.

This move was first hinted at earlier this month as part of a broader push by the Biden administration to tighten up existing export restrictions, but is now Department of Commerce policy.

As reported previously, the request is meeting some resistance both from industry and governments due to potential repercussions.

The allied nations involved include Germany, Japan, South Korea, and the Netherlands. The latter is home to ASML, a key supplier of photolithography equipment, and the only one in the world currently able to supply chipmakers with extreme ultraviolet (EUV) kit for use with the most advanced semiconductor production nodes.

ASML's EUV products were blocked by the Dutch government from being exported to China several years ago, and the Netherlands was last year persuaded to join US efforts in stepping up export restrictions, with new rules added covering some of its deep ultraviolet (DUV) equipment as well.

A Dutch delegation visited Beijing this week, and Trade Minister Geoffrey van Leeuwen was told by his Chinese counterpart that the Netherlands is regarded as a "trustworthy" economic and trade partner. The two are said to have discussed topics including the export of lithography machines and cooperation in the semiconductor industry.

President Xi Jinping told Dutch Prime Minister Mark Rutte during the visit that attempts to restrict China's access to technology will not stop the country's progress, according to CNBC.

"Creating scientific and technological barriers and severing industrial and supply chains will only lead to division and confrontation," Xi said, while reminding Rutte that China is ASML's second largest market after Taiwan.

The Dutch PM responded by stating that decoupling is not a policy for his government either "since any act undermining China's development interests will only boomerang."

According to Reuters, Rutte declined to take questions on whether his government would act to stop ASML from maintaining tools for Chinese customers.

AP quoted Xi as saying that despite the best efforts of the US, "no force can stop the pace of China's scientific and technological development and progress."

We asked the US Department of Commerce and ASML for comment, but ASML declined and the Commerce Department had not responded at the time of publication. ®

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