- The Dutch authorities have taken action regarding Nexperia, the Chinese-owned semiconductor firm in the Netherlands, via the Goods Availability Act.
- After this announcement, Wingtech’s shares listed in Shanghai fell by 10%, hitting the daily limit.
In a bold and surprising step, the Dutch government has seized control of Nexperia, a semiconductor manufacturer owned by the Chinese firm Wingtech, aiming to preserve the supply of critical chips within Europe. This is a significant action in light of ongoing trade tensions globally.
Nexperia plays an essential role in producing semiconductors used in the automotive and consumer electronics industries, and thus its stability is crucial for Europe’s supply chain.
On Sunday, the Dutch Minister of Economic Affairs disclosed that the government had invoked the Goods Availability Act back in September. This measure aims to avoid shortages of both finished and semi-finished products that Nexperia produces, especially during emergencies.
Following the news from The Hague, Wingtech saw its shares dip sharply by the maximum 10% allowed in a single day on the Shanghai Stock Exchange.
The Goods Availability Act enables the Dutch government to step in and manage private companies to guarantee the continuous provision of essential goods in crisis situations. This intervention is particularly relevant amidst worsening U.S.-China trade relations.
The government described this “highly exceptional” intervention as necessary after noticing serious issues with governance at Nexperia that could threaten the technological stability and expertise on Dutch and European territories. Loss of such capabilities could endanger the economic security of both the Netherlands and Europe, particularly in the automotive sector.
Changes in Leadership
According to a filing released on Oct. 13 to the Shanghai Stock Exchange, Wingtech confirmed that Nexperia is now under temporary external management. The company has been instructed to halt any changes to its assets, various business activities, and personnel for a limited time frame of up to a year, based on a English Google translation.
Following the minister’s order, Wingtech’s chairman, Zhang Xuezheng, was suspended from his roles as executive director of Nexperia’s holding company and as a non-executive director of Nexperia.
Nexperia’s ordinary business practices will continue, but the full impact of these measures is still undetermined.
In a deleted WeChat post, later archived and translated by the Pekingnology blog, Wingtech criticized the Dutch government’s decision to freeze Nexperia’s operations as an unwarranted intervention fueled by geopolitical bias, rather than based on real risk evaluations.
Since acquiring Nexperia in 2019, Wingtech claims to have followed all local regulations and maintained transparency in its operations while employing thousands of local workers across R&D and manufacturing locations in the Netherlands, Germany, and the UK.
A representative from Nexperia mentioned to CNBC that the firm has no additional comments but confirmed its adherence to all applicable laws, export controls, and sanctions, while maintaining ongoing communication with the relevant Dutch authorities.
This development arrives shortly after China implemented stricter measures regarding the export of rare earth elements and magnets, which might affect Europe’s automotive industry significantly. The situation further highlights the already tense trade relationship between the Netherlands and China, particularly after past restrictions on Dutch semiconductor equipment exports to the Chinese market.
Moreover, earlier this year, the Netherlands had scrutinized Nexperia’s planned acquisition of the chip startup Nowi, which eventually received approval.
