According to NU.nl, the United States government (USG) might pressure the Dutch government to compel ASML to halt nearly all exports of chip-making equipment to China. The report indicates that the China-based ASML is under pressure to stop exporting its machinery to Chinese clients, as the USG is lobbying against the export of these machines to mainland customers. Readers may recall that the most advanced Extreme Ultraviolet (EUV) lithography tools are already banned from being sold in China, as the USG previously pressured the Dutch government to halt sales of these advanced tools.

In fact, ASML has never shipped a single EUV scanner to China, as the Dutch government, under USG pressure, blocked exports in 2019. In the years following that ban, export restrictions have shifted focus to older DUV scanners, requiring a national export license before shipping to China. However, a new bipartisan bill is now before Congress to tighten export controls even further.

Called the Multilateral Alignment of Technology Controls on Hardware (MATCH) Act, the USG is considering forcing allied countries to implement a technological ban on exporting even the older DUV machines. This could mean that ASML might nearly cease all exposure to China, as the older DUV tools are targeted by China export restrictions. However, China might not be left without DUV tools entirely, as Shanghai Yuliangsheng Technology has reportedly begun limited production of immersion DUV lithography machines in July.

They aim to produce five systems for delivery this year, with an estimated production of about 20 immersion DUV machines by 2027. Multiple customers, including SMIC, CXMT, and Jiangsu Xianxing, are lined up for these machines. Therefore, if the ban does not materialize immediately, it might have little impact on future DUV machine installations across China.

If given sufficient time, China might achieve self-sufficiency in DUV tools, but if the ban is implemented immediately, it could pose problems for mainland companies currently relying on ASML tools.