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Dutch restrict Nexperia to keep its chip secrets outside of China

Barnsley

Well-known member
https://www.techzine.eu/news/securi...ia-to-keep-its-chip-secrets-outside-of-china/

For one year, Nexperia is only allowed to take decisive action when the Dutch government allows it. The Ministry of Economic Affairs is doing this to prevent Nexperia’s chip expertise from falling into Chinese hands.

The move is emphatically an emergency measure. Dutch chip manufacturer Nexperia will not be allowed to relocate any of its business units, appoint executives, or make critical decisions about its own business operations in the coming years without the green light from its government. This has been reported by both Chinese media, where the news first appeared this weekend, and Dutch news publication NRC Handelsblad. Nexperia is owned by the Chinese holding company Wingtech.

Chinese CEO removed from office
The Amsterdam Enterprise Chamber has also removed Nexperia CEO Zhang Xuezheng from his position. This happened after a request from three Nexperia directors on October 1. An emergency hearing on October 6 led to Zhang being temporarily replaced by a non-Chinese director.

Nexperia received the letter from the Ministry of Economic Affairs on September 30, one day before the US imposed stricter export restrictions on Chinese companies. These rules make it impossible for the company to purchase American goods without a license. Since December 2024, Wingtech has been subject to the US’s long-standing tough anti-Chinese measures.

Wingtech responded angrily in an online statement that was later removed. The company spoke of “excessive interference” and “discrimination against companies with Chinese investors.” It also accused foreign management members of exploiting geopolitical tensions.

Emergency measures of unprecedented scale
According to NRC insiders, there were signs that Nexperia was planning to leak chip knowledge to China. This would pose a direct threat to the national and economic security of the Netherlands. The measure is being implemented through the Goods Availability Act, a reserve instrument for extraordinary circumstances such as war or acute national emergencies.

The NRC rightly points out that Nexperia does not design advanced chips compared to powerhouses such as Nvidia, AMD, Qualcomm, or Intel. Nevertheless, its business processes focused on efficiency, such as increasing the yield rate (output) and thereby reducing defective chips, are absolutely valuable.

In an official response, Nexperia refrains from comment and states that it complies with “all laws, regulations, and export restrictions.”
 
Nexperia is owned by the Chinese holding company Wingtech.
Which has invested a lot in its European operations. And now are getting kicked out of the board.

Nexperia received the letter from the Ministry of Economic Affairs on September 30, one day before the US imposed stricter export restrictions on Chinese companies. These rules make it impossible for the company to purchase American goods without a license. Since December 2024, Wingtech has been subject to the US’s long-standing tough anti-Chinese measures.
And yet Trump claims the Chinese RE export restrictions came out of the blue. When the US approved this rule like the day before. Where any company owned by a company in the Entity List also gets automatically banned from anything with any US content in it.

How Wingtech, which used to be a company assembling smartphones for Apple which decided to make semiconductors to earn more money got put into the Entity List is another question. They make transistors and MEMS I think.
 
Very poor optics.

Of course, for the commercial entities involved, there is significant impact; but in the grand scheme of things (Sino-Dutch level), probably much ado about nothing. It is already "I know what you really want to do; I know you know; I know you know I know" situation.

Still, keeping some decorum will offer more off ramps, if and when. And isn't it a bit obtuse to expend so much capital on Nexperia?
 
Many MEMS products can be civil/military dual use.

The anger from the CEO is probably understandable. He is the founder/Chairman/CEO of the Wingtech "empire" and he recently quitted all those positions/titles and just to focus on this expanding semiconductor business. But like many (or most) of the "private entrepreneurs", he is still obligated to serve the Party, in this case by transferring Experia's tech to China. I am guessing but there could more secretive Experia tech than what meets the eye which caused the Dutch gov taking such dramatic moves?
 
NXP spun off Nexperia because it was a marginal business for them. You don't know the Dutch. Especially Philips. If you see them spinning off a company it is because it is close to loss making. Those companies often go bankrupt shortly afterwards.

Wingtech doubled the company revenue and increased investments in the company. They turned it around and now they get kicked out.

The sale to the Chinese was approved by CFIUS.
 
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NXP spun off Nexperia because it was a marginal business for them. You don't know the Dutch. Especially Philips. If you see them spinning off a company it is because it is close to loss making. Those companies often go bankrupt shortly afterwards.
Not sure if you are aware NXP was forced to divest some of their business units as part of their Freescale acquisition. This kind of commodity business might have lower margin level than what NXP typically aims for, but suggesting Nexperia was close to bankruptcy is definitely a false statement.

The Dutch government has funded a lot of R&D activities for Philips/NXP/Nexperia in the past. Nexperia also runs an R&D fab in the Netherlands. When Nexperia announced they would like to transfer this IP elsewhere, this caused the Dutch government to take a very protective position.
One could also argue Wingtech is allowed to transfer any IP as part of their acquisition of Nexperia. I am therefore not taking a position here. Just shining a different light.
 
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