On September 30, 2025, the Dutch government froze the global operations of Nexperia, a semiconductor company controlled by Chinese capital, citing “national security”. Simultaneously, the Amsterdam Court of Appeal ruled to suspend the position of the Chinese CEO. This dual restriction is not an isolated bilateral event; it is deeply intertwined with the United States’ strategy of technological containment against China. The incident not only affects the interests of the semiconductor industries in China, the U.S., and Europe but also forces China to adopt precise countermeasures to defend its core interests. The various data and political considerations revealed in this struggle reflect the deeper logic of the restructuring of the global technology landscape.
1. Background of the Incident: Insights into the Industrial Struggle between China, the U.S., and Europe
Nexperia has become the focal point of this struggle, representing a microcosm of the competition for discourse power in the semiconductor industry among China, the U.S., and Europe. Three core data sets clearly outline the comparative strengths and competitive dynamics of the three parties. In terms of market and production capacity, the three parties present a pattern of “the U.S. holding high-end, China occupying mid-range, and Europe relying on supporting roles”. The U.S. holds 50.4% of the global semiconductor market and plans to increase domestic manufacturing capacity by 203% by 2032, with high-end logic chip manufacturing accounting for 28% of the global total. However, by 2025, its exports to China are expected to drop by 42%, leading to revenue declines of 32% and 35% for Applied Materials and Lam Research, respectively. China, on the other hand, firmly occupies the mid-range market, with domestic 28nm lithography machines expected to achieve mass production and yield rates exceeding 85% by 2025, diverting 15% of ASML’s mid-range orders; SMIC’s mature process capacity of 28nm and above accounts for 28% of the global total, with automotive chip production capacity increasing by 35% year-on-year.
As of November 21, 2025, the total market value of China’s semiconductor sector reached 6.3 trillion yuan, with SMIC alone valued at over 900 billion yuan, forming a complete industrial cluster. Europe, however, is highly dependent on industrial chain collaboration. Although ASML controls the core technology of high-end lithography machines, its net sales reached 7.5 billion euros in the third quarter of 2025, with 25% of its R&D funding coming from the Chinese market. The R&D of the next generation of lithography machines has been delayed by 18 months due to the interruption of cooperation with China, and 60% of the EU’s rare earth ores need to be refined in China, with processing costs per kilogram exceeding $120 compared to direct procurement of finished products.
In terms of technology and localization, the blockade has instead accelerated China’s breakthroughs. In 2024, the market size of China’s semiconductor equipment is expected to exceed $30 billion, with the localization rate jumping from 15% in 2023 to 23%. By 2025, the proportion of domestic equipment procurement by companies like SMIC and Huahong will have increased to 45%. Zhongwei’s global equipment shipments have exceeded 5,000 units, replacing 15% of Applied Materials’ share at SMIC; Nanda Optoelectronics’ ArF photoresist has achieved mass production, increasing the localization rate of photoresists from 5% to 12%.
In contrast, Europe faces obstacles in advancing its “Critical Raw Materials Act”, with a lack of rare earth refining technology leading to a fragile supply chain. Although the U.S. has increased R&D funding through the “CHIPS Act”, one-fifth of its revenue invested in R&D has not prevented Chinese chips like Huawei’s Ascend from diverting orders in the AI field. In terms of industrial impact, the restrictions imposed by the U.S. and Europe have already shown backlash. After the interruption of Nexperia’s supply, the European automotive industry has inventory sufficient for only a few weeks, forcing Honda’s Canadian plant to cut production by 50%. The contribution of the Dutch semiconductor industry to GDP has also dropped from 4.2% to 2.8%, resulting in a 0.7 percentage point increase in unemployment.
2. China’s Countermeasures: Multiple Political Considerations Behind Precise Policies In response to the unilateral provocation from the U.S. and the Netherlands, China’s countermeasures are not merely about defending rights but also involve a political layout that balances short-term interests with long-term strategies, containing three core considerations. First is the defense of multinational investment rules and international credibility. After acquiring Nexperia, Chinese capital contributed 130 million euros in taxes to the Netherlands within five years, yet it faced dual deprivation from administrative and judicial actions, undermining the spirit of international investment contracts. China has prohibited the export of chips manufactured by Nexperia in China, directly targeting 80% of its production capacity, while retaining the right to freeze the assets of the involved parties in China under the “Anti-Foreign Sanctions Law”. This essentially sends a signal to the world that “the rights of Chinese enterprises abroad cannot be infringed upon”. Such measures can curb the risk of other countries emulating the Netherlands, preventing a “wave of confiscation” against Chinese capital and establishing a regulatory barrier for future cross-border mergers and acquisitions by Chinese enterprises.
Second is to break the technological hegemony and promote self-controllable industrial chains. The U.S.-driven “50% ownership penetration rule” and the restrictions from the Netherlands are fundamentally aimed at curbing the upgrade of China’s semiconductor industry. China uses its rare earth industrial chain as a bargaining chip, leveraging its 92% refining capacity to control the raw material lifeline of companies like ASML, precisely targeting the vulnerabilities of the European semiconductor industry. At the same time, countermeasures have further consolidated domestic industrial consensus, accelerating the third phase of the 340 billion yuan semiconductor fund to tilt towards equipment and materials, forcing Chinese companies to focus on critical areas like EDA tools and high-end chips, promoting a transition from “replacement” to “breakthrough” and reducing dependence on overseas industrial chains.
Finally, it aims to garner international public opinion and divide the U.S. and Europe. While implementing countermeasures, China agreed to send representatives for consultations with the Dutch Ministry of Economic Affairs, demonstrating a rational communication stance, contrasting sharply with the politicization of commercial issues by the U.S. and the Netherlands. There are already contradictions within Europe between economic interests and political dependencies; warnings from the German Automotive Industry Association and the difficulties faced by ASML in R&D highlight the EU’s dependence on the Chinese market and technology. China’s countermeasures amplify these contradictions, prompting European enterprises to pressure their governments, weakening U.S. control over European technology policies, and seeking more international support for a more balanced global technology governance system.
3. Global Shock: Multiple Parties Under Pressure Amid Industrial Chain Restructuring The impact of this struggle has transcended bilateral boundaries, placing China, the U.S., and Europe in differentiated competitive dynamics. For China, while facing the challenge of increased caution in overseas mergers and acquisitions by Chinese enterprises in the short term, the long-term trend will accelerate the localization of basic chips, as evidenced by the rapid increase in semiconductor localization rates by 2025. For Europe, the actions of the Netherlands not only lead to a crisis of production stoppage in the automotive industry but also damage the EU’s reputation as a “safe investment zone”, potentially triggering a chain reaction of foreign capital withdrawal. For the U.S., its “long-arm jurisdiction” has temporarily curtailed China’s access to high-end chips but has also caused domestic companies to miss out on the vast Chinese market, leading to a long-term loss of application scenarios for technological iteration.
4. Future Direction: Seeking a Balance Point Amidst the Struggle The current competitive landscape among China, the U.S., and Europe has shown signs of change. In November 2025, the U.S. suspended the “50% penetration rule” for one year, undermining the core basis for the Netherlands’ intervention in Nexperia. The future is likely to present a situation of “primarily negotiation and reconciliation, with ongoing competition”: the Netherlands will likely gradually lift restrictions in exchange for China lifting export constraints, alleviating domestic industrial pressures. In the long run, the regional restructuring of the global semiconductor industrial chain will be irreversible. China will continue to strengthen mature process capacity, Europe will accelerate the implementation of the “European Chips Act”, and the U.S. will push for the expansion of domestic manufacturing. However, as long as global market demand persists, complete “decoupling” among China, the U.S., and Europe will be difficult. This Nexperia incident will ultimately lead more countries to realize that technological hegemony and unilateral intervention will backfire, and only by adhering to rules and equal cooperation can the global semiconductor industry achieve win-win development.
November 22, 2025, in Qingdao, Yiyun Pavilion