Bloomberg News reported that Japan and Netherlands will soon agree to join the US to restrict exporting semiconductor manufacturing equipment to China.
Citing people familiar with the matter, Bloomberg reported, that talks between the countries will conclude on Friday, and the Netherlands will restrict ASML Holdings NV from selling machines to China which is used for making certain types of advanced chips.
The report also reported that similar restrictions would be imposed on Nikon Corp by Japan.
It would be a major diplomatic win for U.S. President Joe Biden’s administration if it gets Netherlands and Japan to impose tighter export controls on China. The U.S. announced in October that sweeping restrictions on Beijing’s access to U.S. chipmaking technology would slow its technological and military advances.
The absence of Japanese or Dutch cooperation would pose as a competitive disadvantage to U.S. companies.
“We have been in discussion with the United States and other countries regarding the export-control regime,” Yasutoshi Nishimura, Japan’s Minister of Economy, Trade, and Industry, told reporters on Friday.
“We will implement any measures in accordance with our Foreign Exchange Law and through international cooperation,” he added while declining the provision of further details.
Nikon, which relies on China for about a quarter of its sales, could be affected. The Japanese company most likely to be impacted by these new restrictions will be chip manufacturing machinery maker Tokyo Electron. As said by Masahiko Hosokawa, a Meisie University professor and former director general of trade control at the ministry.
“A balance needs to be struck so no one among Japan, the United States and Europe will be disproportionately disadvantaged. It’s about fairness,” he said.
The sales of affected chip-related companies in Japan is expected to rebound quickly because the market for the equipment is expanding, a trade and industry official involved in overseeing semiconductor firms reported. The source urged not to be identified as he is not authorized to speak to the media.