Dutch government backs down, reverses steps taken at Nexperia

The Dutch government has suspended its intervention at Nexperia, which allowed the government to block decisions at the Nijmegen-based chipmaker that could jeopardize chip production in Europe, caretaker Minister Vincent Karremans of Economic Affairs announced. He hopes the move will help restore relations with China.

At the end of September, Karremans implemented an obscure and never-before-used law from the 1950s to intervene at Nexperia. In practice, the step froze Nexperia’s operations and banned its Chinese owner from relocating any parts or machinery. He cited “acute signals of serious governance shortcomings and actions” at Nexperia, which could result in crucial technologies and capabilities disappearing from the Netherlands and Europe.

One day later, a Dutch court also intervened in Nexperia. The Enterprise Chamber of the Court of Appeal suspended the company’s director-owner and placed Nexperia’s shares under independent management. According to the government, it was a coincidence that these two interventions happened so close together.

In response, China blocked the export of chips from Nexperia’s factory in that country. Nexperia’s headquarters are in Nijmegen, but the chips are produced in factories in Asia, the largest of which is in China. The export ban left automakers facing weeks of uncertainty about their stocks and deliveries and sparked an international political conflict, with China being convinced that the United States was behind the Dutch decisions. Dutch officials are currently in China to discuss the matter.

On Wednesday, Karremans announced that he had decided to suspend the intervention at Nexperia. “In light of recent developments, I consider it the right moment to take a constructive step,” he said, adding that the decision to step back was made “in close consultation with our European and international partners.”

“We are positive about the measures already taken by the Chinese authorities to ensure the supply of chips to Europe and the rest of the world. We see this as a show of goodwill. We will continue to engage in constructive dialogue with the Chinese authorities in the period ahead,” Karremans said.

The caretaker Minister did not say anything about the Dutch government’s concerns that sparked this move in the first place. Insiders at his Ministry previously told NRC that the government feared Nexperia’s Chinese owner was stealing trade secrets from a British factory and was about to dismantle the company’s European branch.