Netherlands to Restrict ASML's Operations in China

The Dutch government is poised to further restrict ASML's operations in China by not renewing key licenses for the repair and maintenance of its advanced semiconductor equipment, particularly deep ultraviolet (DUV) lithography machines, when they expire at the end of the year. This decision, influenced by pressure from the United States, could severely impact China's semiconductor industry, notably affecting companies like SMIC and Huawei that rely on ASML's technology. Without maintenance services, some of ASML's equipment may become inoperable, jeopardizing China's ability to produce advanced chips on 7nm and 5nm processes. These restrictions align with ongoing U.S. efforts to limit China's access to cutting-edge chip technology for national security reasons. ASML, which generates a significant portion of its revenue from China, has not publicly commented on the matter, and its shares have shown resilience in the market despite the looming restrictions.