ASML export controls and China: the Dutch company at the centre of the chip war

ASML export controls are now one of the most watched issues in global technology. There is a factory in Eindhoven building machines so complex that no other company on Earth can make them. Each one costs up to $400 million. Each one takes years to assemble. And right now, they are at the centre of the most consequential technology dispute of our time.

ASML probably is not a household name. But if you have used a smartphone, run an AI tool, or streamed anything in the last five years, you have depended on what it makes.

A machine that makes the machines

ASML does not make chips. It makes the equipment that makes chips possible.

Its extreme ultraviolet (EUV) lithography systems project patterns onto silicon wafers at near-atomic scale, essentially drawing the blueprint of a processor using light with a wavelength shorter than an X-ray. The process requires mirrors polished to within a fraction of an atom, a plasma source hotter than the surface of the sun, and vibration isolation so sensitive it can detect a footstep from across a building.

It took decades to develop. And ASML is the only company in the world that can do it at industrial scale.

Every advanced chip inside an Nvidia GPU, an iPhone, or an AI data centre was manufactured using one of these machines. Without ASML, the AI boom you read about daily would not be possible at the pace it is happening. If you want to understand how Dutch deeptech companies build this kind of global dominance, our overview of the Dutch tech ecosystem is a good place to start.

How a company from Eindhoven ended up in a geopolitical standoff

Here is where it gets interesting.

China is the world’s largest buyer of semiconductors. For years, it was also one of ASML’s fastest-growing markets. But as AI and advanced chips became central to national power, the United States pushed hard to cut China off from the technology needed to manufacture them.

The Netherlands, a close US ally but also a trading nation with deep ties to China, found itself in an uncomfortable position. ASML had never sold its most advanced EUV machines to China. But it had sold older DUV (deep ultraviolet) systems, which Chinese chipmakers were using to build surprisingly competitive chips.

Restrictions tightened through 2023 and 2024. By late 2025, the Netherlands had fully aligned with the US position, ending what analysts described as its cautious cooperation stance. China’s share of ASML’s revenue, which had been a major growth engine, is now expected to drop significantly through 2026. For more on how the Netherlands navigates its position between major trading blocs, see our piece on Dutch trade and technology policy.

China is not giving up

Here is the twist that makes this story run and run.

Chinese manufacturers have been retrofitting older ASML machines to push beyond their original specifications, essentially pushing Dutch equipment to produce chips the export controls were designed to prevent. Meanwhile, reports have emerged about a Chinese-developed EUV prototype, though most experts believe domestic capability remains at least a decade behind.

China also responded by restricting exports of rare earth materials, elements essential to building ASML’s systems. That has been temporarily paused as part of broader US-China trade negotiations, but the underlying tension has not gone away.

The pattern of moves and countermoves shows no sign of stopping. Eindhoven’s broader semiconductor cluster, which includes companies working on chip inspection and AI hardware, is watching these developments closely.

What this means for the Netherlands

For a country of 18 million people, the stakes are remarkably high. ASML is not just a successful company. It is a piece of critical global infrastructure that has made the Netherlands genuinely indispensable to the world’s most powerful governments.

That is a position of extraordinary leverage. It also comes with pressure from all sides.

What happens next in Eindhoven will not just affect Dutch shareholders. It will shape how fast AI develops, which countries can manufacture advanced chips, and whether the global technology supply chain stays connected or splits in two.

Not bad for a company most people have never heard of.