Netherlands to give up control of Nexperia in China dispute

The Netherlands praised China's softening of export restrictions as a "show of goodwill." The dispute has alarmed European car manufacturers, who have warned of serious supply chain disruptions on high-tech chips.

The Netherlands is giving up control of Chinese-owned chipmaker Nexperia, the acting Dutch Economic Minister Vincent Karremans said on Wednesday.

It comes amid a dispute between the Netherlands and China sparked by the Dutch government's takeover of the company in September.

European carmakers rely heavily on Nexperia components.

Dutch, Chinese ministries hail step forward in talks

The Dutch minister indicated the Netherlands was responding to positive signals from China.

"In light of recent developments, I consider it the right moment to take a constructive step," Karremans said in the Netherlands' administrative center, The Hague.

He described Beijing's decision to loosen previously imposed chip export restrictions as a "show of goodwill" and said the Netherlands would "continue to engage in constructive dialogue with the Chinese authorities in the period ahead."

He stressed that an interim management will stay in its position and the previous Chinese management will not be reinstated.

The announcement comes as a Dutch delegation visits Beijing for further talks.

Meanwhile, China welcomed the decision as a "first step" toward a full resolution of the dispute.

"China welcomes the Dutch side's initiative to suspend the administrative order, considering it the first step in the right direction towards properly resolving the issue," a Chinese Commerce Ministry spokesperson said in a statement.

"However, there is still a gap in addressing the root cause of the turbulence and chaos in the global semiconductor supply chain," the statement read.

What is the Nexperia chip dispute between the Netherlands and China?

The Dutch government effectively took control of Nexperia in September.

It cited security concerns and "serious governance shortcomings" on the part of its parent company, Wingtech Technology, as the reason for the move.

Nexperia has its headquarters in the Dutch city of Nijmegen, while Wingtech is based in Jiaxing in China's eastern Zhejiang province and is partially owned by the Chinese state.

In response to the Netherlands' takeover of the firm, Beijing imposed export restrictions on Nexperia risks, which startled European car manufacturers, who warned of serious supply chain disruptions.

China later decided to soften the restrictions, but insisted the Dutch government loosen its control on Nexperia before a full resumption of chip deliveries.

Edited by; Wesley Rahn