THE Dutch government has no choice but to eat its pride and suffer humiliation after signaling it is ready to return ownership of global chipmaker ‘Nexperia’ to its Chinese owners which it illegally seized in late September due to pressure from the United States.
According to a Bloomberg report dated November 8 and citing “people familiar with the matter,” the Netherland is prepared to forgo its seizure of Nexperia provided its Chinese production facilities start shipping out its products again, particularly to global car makers that are its main customers.
The Dutch government seized the company on the instigation of the United States as part of its failed strategy to contain the rise of China (Pinoy Exposé, October 28, 2025).
It however forgot that the global automobile industry is highly dependent on the company for the power and other electronic chips necessary in the making of a modern automobile.
It also forgot that while Nexperia’s main office is in the Netherlands, over 70 percent of its production, including the packaging and testing of its products, are coming out from its factories and facilities in China.
In retaliation, China ordered Nexperia’s China office to stop exporting its chip products from their customers and to only follow the decisions of its China-based management.
This resulted in a situation where the Netherland ended up controlling the “shell” of Nexperia’s main office while business and production continue unhampered in China.
China’s Foreign Ministry, for its part, also put the blame squarely for the global supply chain disruption to the Dutch government.
From Europe to Japan to North America, car manufacturers like Honda, Toyota, BMW and Volkswagen were placed in a state of panic as their lack of critical supply from Nexperia disrupted and halted production everywhere.
The Netherland was encouraged by the United States to seize Nexperia after threatening it of sanctions based on the new “50 percent plus” rule of the US Commerce Department where companies with more than 50 percent Chinese ownership would also be sanctioned.
This, after the US Commerce Department in December 2024 included Wingtech Technology, Nexperia’s parent company, from its sanctions list of Chinese companies.
Nexperia is on the brink of bankruptcy when it was purchased by Wingtech in 2019 for $3.6 billion and turned it into a global supplier of critical electronic chips for the global automobile industry.
To drive home the point of who really is in control, Nexperia China started signing supply contracts with customers without the approval of its Netherland office.
The new contracts also specified that payments would now be made in RMB, the Chinese currency, which is seen as China’s strategic move to further weaken the US dollar.
More trouble for the Netherland, EU
At the US-China Summit in Busan, South Korea during the APEC Summit early this month, US President Donald Trump and Chinese President Xi Jinping agreed to a “moratorium” in their trade war whereby the USA agreed to suspend its 50 percent plus rule in exchange for Chinese purchases of US soybeans and the extension of its ban on the export of rare earth materials for one year.
As the deal was between the United States and China, the Netherland and the EU are not automatically included in the arrangement.
China made it clear that especially for the supply of rare earth minerals, other countries would need to comply with its new restrictive export permit regulation that is set to take effect on December 1.
From that date, any country utilizing even “zero point one percent” (0.1 percent) of any rare earth mineral produced or processed in China would have to apply for an export permit with the approval covered by the case-to-case basis” principle.
Expected to be the hardest hit would be ASML of the Netherland, the world’s only producer of specialized ‘lithographic machines’ needed for the production of very small microchips with a variety of uses and chips used for artificial intelligence (AI).
It is estimated that upwards to 20 percent of ASML products used rare earth minerals supplied by China before they can be completed.
Since the first Trump administration, ASML has been colluding with the US to restrict the export to China of advance lithographic machines.
But with Chinese tech companies like Huawei and SMIC (Semiconductor Manufacturing International Corporation) announcing breakthroughs in their own chipmaking capability using domestically develop lithographic machines, ASML’s monopoly has been effectively broken.
The new export control by China can result to the bankruptcy of ASML and US-based chipmaker NVIDIA.
NVIDIA is no longer allowed to sell its products to government offices in China, incidentally, the biggest procurer of micro and AI chips and computers in the country.