The Dutch government takes control of the Chinese-owned chip company

The Dutch government has taken control of Nexperia, a Chinese-owned chipmaker based in the Netherlands, in an attempt to protect European supplies of semiconductors for cars and other electronic goods and protect Europe’s economic security.

The Hague said it made the decision due to “serious deficiencies in management” and to prevent the chips from becoming unavailable in emergency situations.

Wingtech, which owns Nexperia, said on Monday that it would take measures to protect its rights and would seek government support.

This development threatens to raise tensions between the European Union and China, which have increased in recent months due to trade and Beijing’s relationship with Russia.

In December 2024, the US government included Wingtech on the so-called “Entity List”, designating the company as a national security concern.

Under the regulations, US companies are prohibited from exporting US-made goods to listed companies unless they obtain special approval.

in the united kingdom, Nexperia was forced to sell its silicon chip factory in NewportAfter representatives and ministers expressed concerns related to national security. It currently has a UK facility in Stockport.

The Dutch Ministry of Economy said it had taken the “extremely exceptional” decision to activate the Availability of Goods Act due to “severe indications of serious management deficiencies” within Nexperia.

The ministry said in a statement, “These signals constitute a threat to the continuity and protection of important technological knowledge and capabilities on Dutch and European territory.”

“Losing these capabilities could pose a risk to Dutch and European economic security.”

The statement did not explain why he believed the company’s operations were risky. A spokesman for the Minister of Economic Affairs told the BBC that there was no further information to share.

These measures aim to keep European chip supplies flowing and protect Dutch intellectual property, said Sascha Courtial, an EU-China researcher.

In the event of a crisis, he said, the Chinese-owned company could come under pressure from Beijing to halt supplies or prioritize sales to China, crippling European industries such as automakers and electronics manufacturers.

The Hague’s move puts economic security “above free-market investment principles,” which could pave the way for other governments to follow suit, said Courtial of the Jacques Delors Institute.

The Availability of Goods Act is designed to allow the Hague to intervene in companies under exceptional circumstances. These threats include the country’s economic security and ensuring the supply of vital goods.

Under this order, the Dutch Minister of Economic Affairs, Vincent Karremans, can cancel or block Nexperia’s decisions if they may harm the company’s interests, its future as a business in the Netherlands or Europe, or to ensure supplies remain available in the event of an emergency.

The Dutch government added that the company’s production can continue as usual.

The ministry said: “This measure aims to mitigate this risk.”

Shanghai-listed shares in Nexperia’s parent Wingtech fell 10% on Monday morning.

A Nexperia spokesperson said the company “complies with all current laws, regulations, export controls and sanctions regimes” and had no further comment.

In a statement in Chinese, Wingtech said its operations are continuing without interruption, and that it remains in close contact with its suppliers and customers.

Wingtek The company’s president, Zhang Xueqing, was suspended from serving on Nexperia’s board of directors by court order in Amsterdam earlier this month, the company said in a stock filing.

She added that the company is also in talks with lawyers about potential legal remedies.

The BBC also contacted the Chinese embassies in the Netherlands and Brussels.