The Netherlands plans new controls on exports of chip-making equipment to China and a deal could be announced next month, Bloomberg reported on Thursday, citing people familiar with the matter.
Dutch firm ASML Holdings is a world leader in semiconductor production equipment and had sales to customers in China of more than 2 billion euros (S$2.9 billion) last year.
However, since 2018 the Dutch government has not granted ASML licences to export its most advanced machines to China as they are considered "dual use" with potential military applications.
Dutch Trade Minister Liesje Schreinemacher last month said the Netherlands was in talks with the US government about new export restrictions on semiconductor equipment sales to China.
According to Bloomberg, an agreement could come as soon as next month, adding that it was unclear what the new restrictions would mean for ASML's sales to China.
The Dutch Ministry of Foreign Affairs, the White House's National Security Council and ASML declined to comment.
"This news will not come as a complete surprise to the market," Citi analyst Amit Harchandani said, noting that ASML in October had indicated that up to about 5 percent of its total backlog was at indirect risk from the broader US restrictions.
The company's prospects outside China remain strong, he added.
China is the Netherlands' third-largest trade partner after Germany and Belgium, according to the Dutch statistics office.
The Biden administration in early October published a sweeping set of export controls, including a measure to cut China off from certain semiconductor chips made anywhere in the world with US tools.
