Why has Dutch government taken control of China-owned chipmaker Nexperia?

The Dutch authorities has intervened to instrumentality effectual power of exertion radical Nexperia, which is owned by Chinese radical Wingtech Technology.

The determination comes amid a increasing rift betwixt China and the West implicit the improvement of exertion specified arsenic machine chips and semiconductors, which are indispensable components for the manufacture of artificial quality (AI) technology.

Here is much astir what the Dutch authorities announced, wherefore and what happens next.

What has the Dutch authorities announced?

In a connection released connected Sunday, the Dutch Ministry of Economic Affairs said it had invoked the “highly exceptional” Goods Availability Act to intervene and instrumentality power of Nexperia connected September 30.

The Goods Availability Act allows the Netherlands to intervene successful privately owned companies successful exceptional circumstances, specified arsenic if the authorities perceives a menace to the country’s economical information oregon if it is indispensable to guarantee that captious goods stay available.

Why has the Dutch authorities taken this step?

The determination followed an exigency proceeding by the Dutch Enterprise Chamber connected October 7, which concluded that determination whitethorn beryllium “valid reasons to uncertainty dependable absorption astatine Nexperia nether the enactment of erstwhile CEO Zhang Xuezheng”, a connection from the institution said.

The Dutch Enterprise Chamber is simply a peculiar part of the Amsterdam Court of Appeal, which hears firm instrumentality cases and different matters that could person large societal oregon fiscal consequences.

In its statement, the authorities said the involution had been carried retired “due to superior administrative shortcomings” astatine Nexperia, which “posed a menace to the continuity and safeguarding connected Dutch and European ungraded of important technological cognition and capabilities”.

It claimed that the involution would guarantee Nexperia’s finished and semi-finished products would stay disposable successful lawsuit of an emergency.

The ministry added that “losing these capabilities could airs a hazard to Dutch and European economical security.”

Following this intervention, it said, “the company’s regular accumulation process tin continue.”

However, it added, “Based connected the order, decisions wrong the institution tin beryllium blocked oregon reversed if they are (potentially) harmful to the company’s interests, its aboriginal arsenic a Dutch and European company, and/or the preservation of this important worth concatenation for Europe.”

The connection said that “involved parties” tin entreaty the determination successful court.

What is Nexperia and however has it responded to the authorities action?

Nexperia is simply a planetary semiconductor shaper headquartered successful Nijmegen, the Netherlands. It emerged arsenic a effect of electronics radical Philips’ acquisition of London-based Mullard Radio Valve Company and Hamburg-based Valvo successful the 1920s, yet forming Philips’ semiconductor operation. In 2006, Philips spun disconnected its semiconductor division, which became NXP Semiconductors, and this was aboriginal sold to a consortium of investors led by Beijing Jianguang Asset Management (JAC Capital). Wingtech acquired Nexperia from that consortium for $3.63bn successful 2018.

According to its website, Nexperia employs 12,500 radical successful Europe, Asia and the United States.

Nexperia’s manufacturing tract spans much than 80,000 quadrate metres (861,000dsq feet) and has the capableness to physique much than 50 cardinal components annually. It besides has income offices and research-and-development sites successful China.

On Tuesday, Nexperia announced that it had suspended Zhang, laminitis of Wingtech, arsenic a manager and removed him arsenic main enforcement serviceman (CEO). It has appointed Stegan Tilger, main fiscal serviceman (CFO), arsenic interim CEO.

“Due to the aforesaid superior managerial shortcomings, the Dutch Ministry of Economic Affairs observed that Nexperia’s operations successful Europe were being compromised successful an unacceptable manner. This concern raised broader concerns for the Dutch authorities astir the availability of semiconductor products captious to the European industry,” Nexperia’s connection said.

“The operation of Zhang Xuezheng’s behaviour arsenic CEO and (indirect) shareholder, arsenic good arsenic concerns astir the semiconductor merchandise availability successful the Netherlands and Europe, yet led the Dutch authorities to intervene with an exceptional exigency bid connected the ground of the Goods Availability Act.”

The connection added that the government’s bid has besides prohibited Nexperia from relocating institution assets, firing existing executives oregon making important decisions without explicit authorities support for 1 year.

Nexperia said it is assured its regular operations volition proceed arsenic usual.

What has led up to each this?

On October 9, China tightened export controls for captious rare-earth metals, citing nationalist information interests. Foreign companies indispensable present get support from Beijing earlier they tin export the named rare-earth metals oregon immoderate products that incorporate them. Exporters indispensable archer the authorities however the products volition beryllium used.

The US is simply a large user of Chinese rare-earth metals, which are captious for its defence industry. Following China’s announcement astir caller export restrictions, US President Donald Trump responded by threatening to enforce a caller 100 percent commercialized tariff connected China.

Besides being utilized for the manufacture of smartphones, electrical cars and weapons, rare-earth metals are besides utilized successful the manufacture of semiconductors, which are indispensable for the improvement of artificial quality (AI) technology.

The US and its Western allies successful Europe have, successful caller years, passed regulations restricting China’s entree to Western semiconductor technology, fearing that China could reverse-engineer and manufacture the technology, moving up successful the technological race.

In 2022, erstwhile Democratic US President Joe Biden restricted China’s access to US semiconductors. The caller rules extended restrictions connected chipmaking tools being sold to industries which enactment the semiconductor proviso chain. They blocked these industries from accessing US method expertise, arsenic good arsenic the cardinal components required to physique the machines that nutrient microchips.

The US further tightened these restrictions successful October 2023 and, again, successful December 2024.

On September 29, 2025, the US Bureau of Industry and Security extended US export power restrictions to each groups which are astatine slightest 50 percent-owned by 1 oregon much entities connected the US Entity List, a database of overseas organisations and companies believed to beryllium participating in, oregon are astatine important hazard of participating in, activities that spell against US nationalist information oregon overseas argumentation interests. These entities are taxable to sanctions, export restrictions oregon licensing requirements. While Nexperia itself is not connected the list, Wingtech was added successful December 2024.

Then, connected October 4, China’s Ministry of Commerce announced export controls preventing Nexperia China and its subcontractors from exporting definite finished components and sub-assemblies made successful China.

“Nexperia is actively engaging with the Chinese authorities to get an exemption from these restrictions and has deployed each disposable resources to that end,” the Nexperia connection said.

“While Nexperia has made capable preparations to guarantee concern continuity – and arsenic the BIS regularisation provides for a 60-day grace play – we are assured that a solution volition beryllium found,” Nexperia said successful its connection connected Tuesday.

Compounding each this, earlier successful the year, US President Donald Trump imposed tariffs of 145 percent connected Chinese imports to the US. China retaliated with a tariff of 125 percent connected US goods. Both countries past reduced their tariffs for 90 days successful May to let for commercialized talks. In August, the 2 agreed to different 90-day pause, with the astir caller circular of talks taking spot betwixt US and Chinese officials successful Spain past month.

But the US has besides imposed restrictions connected astir Chinese cars from being sold successful the US. These see precocious tariffs connected Chinese-made electrical vehicles.

In summation to its modular 10 percent car import duty, the EU announced past twelvemonth that it would enforce a scope of further tariffs connected electrical vehicles, from 7.8 percent for Tesla vehicles to 35.3 percent connected China’s state-owned SAIC [Shanghai Automotive Industry Corporation] vehicles.

How person Wingtech and China responded to the Dutch authorities announcement?

Wingtech released a societal media connection saying it “firmly opposes the politicisation of commercialized matters”.

In the post, it deemed the Dutch government’s determination “an excessive involution based connected geopolitical bias alternatively than a fact-based hazard assessment” that is based connected the “unfounded pretext of nationalist security”.

Shares successful Wingtech person plummeted by 10 percent connected the Shanghai Stock Exchange since the announcement. As a result, Wingtech was forced to explicate the concern to the exchange, saying that the Dutch government’s determination “temporarily restricts” its power implicit Nexperia.

Beijing “consistently opposes the overstretching of nationalist information concepts and discriminatory practices targeting companies from circumstantial countries”, Lin Jian, spokesperson for the Chinese Ministry of Foreign Affairs, said connected Monday.

“Relevant countries should genuinely uphold marketplace principles and debar politicising economical and commercialized issues.”

How person others reacted?

The European Union has been intimately coordinating with Dutch officials and volition present enactment with the Netherlands to determine what to bash adjacent to support important tech capabilities successful Europe, according to European Commission spokesperson Olof Gill.