The Dutch government’s takeover of chip maker Nexperia has been a month-long saga since September. This bold and unprecedented move signifies a new stage in Europe’s control of Chinese technology in the semiconductor field. Experts suggest that in the face of various forms of technological theft by China, the West should adopt a Cold War approach.
According to a report by Reuters on October 27, the Dutch government decided to take over Nexperia due to concerns that former CEO Zhang Xuezheng had split the company’s European business and shifted production to China. The government froze the assets and operations of all 30 Nexperia entities globally and forced changes in Chinese management.
Nexperia is one of the world’s largest basic chip manufacturers, producing products such as transistors that are not technologically complex but have high demand. Its largest manufacturing base is in Hamburg, Germany, but about 70% of the chips are packaged and distributed in China.
Before being suspended as CEO by a Dutch court on October 1, Zhang had transferred confidential information from the company’s factory in Manchester, UK to a Wingtech factory in China, including chip designs and machinery setups. There are plans to transfer physical equipment from the company’s Hamburg production factory and to lay off 40% of employees in Europe, as well as close a research facility in Munich.
Dutch media NRC reported on October 27 that Zhang plans to transfer all wafer production in Europe to China, outsourcing it to Shanghai Dingtai Jiuchips Technology Co., Ltd. (Wingskysemi), a significant project of the Shanghai municipal government aiming to become “China’s first 12-inch car-grade power semiconductor wafer plant.”
Zhang is the founder of Wingtech, which is now owned by the State-owned Assets Supervision and Administration Commission of the State Council of China.
The Dutch government’s rare use of the 1952 Cold War-era “Goods Availability Act” is noteworthy. The Dutch Ministry of Economic Affairs stated that “the CEO’s actions posed a serious threat to Nexperia’s production capacity, knowledge, and intellectual property sustainability.” The statement also indicated that without government intervention, “the company’s European division would essentially disappear in the short term.”
In response to the Dutch government’s takeover of Nexperia, China reacted strongly by prohibiting the company’s product export on October 4.
Nexperia’s products are not cutting-edge chips but belong to a mature process. Why has it become a controlled subject?
From a superficial perspective, it is related to the latest control measures by the US. Wingtech was suspected of “assisting China in acquiring entities with sensitive semiconductor manufacturing capabilities” and was added to the US Entity List in December 2024. In June 2025, the US informed the Netherlands that removing Nexperia’s CEO was necessary to avoid trade restrictions. On September 30 this year, the US Department of Commerce’s Bureau of Industry and Security (BIS) issued new regulations, introducing the “50% rule,” putting Nexperia in the spotlight as Wingtech’s wholly-owned subsidiary.
According to experts interviewed by Epoch Times, this incident reflects that Western technology control has extended to mature technologies and supply chain sovereignty.
Su Ziyun, Director of the Strategy and Resources Institute for National Defense and Security in Taiwan, pointed out that although Nexperia’s chips are based on mature processes, the techniques used still differ, ultimately determining the product’s yield and performance. “For example, TSMC and Samsung, both using advanced processes, TSMC’s yield and product stability are much higher than Samsung’s.”
He stated that while mainland China also has mature processes, its yield and chip stability may be inferior. Accessing production techniques and secrets from other manufacturers improves their mature processes, constituting unfair competition.
Su Ziyun mentioned that the West had a technology control agreement with the Soviet Union in the ’80s, but after the end of the Cold War in the late ’90s, this control pact became more relaxed. European countries now have clearer threats from China and are thus adopting stricter management measures.
Sun Guoxiang, a professor at the International Affairs and Business Department of Nanhua University in Taiwan, pointed out two risks of Nexperia for the Dutch government. Firstly, it poses a supply chain risk point if the European automotive industry is controlled by China. Secondly, there is a risk to technological sovereignty as all the manufacturing secrets, production parameters, quality systems, and R&D teams accumulated in Europe have been stripped away and duplicated in China, leaving Europe hollow.
The Dutch government’s use of the “Goods Availability Act” and other national security tools to directly take over a mature automotive chip supplier is quite extraordinary. It indicates that the West is no longer willing to tolerate China and is starting to view the relocation of mature processes and production lines as sensitive technology control measures, not just limited to 3 nanometers or artificial intelligence accelerators.
Sun Guoxiang added that Beijing’s reaction shows this is not a mere commercial dispute. The Chinese Ministry of Commerce ordered a ban on the company’s product exports on October 4, equating Nexperia to a chip in diplomatic and industrial retaliation.
Professor Feng Chongyi from the University of Technology Sydney said the Netherlands should have taken such actions earlier, as the US and China are now in a Cold War scenario. Feng believed that if this Cold War logic is not acknowledged, many grave mistakes would be made. He said the Cold War is a standoff between systems with different values, requiring a final showdown. Doing business with China and sharing technology with the Chinese regime is akin to collaborating with the enemy in this context.
Since the end of the Cold War in 1989 when the Soviet Union collapsed, Western elites have held optimistic and frivolous beliefs such as the “end of history” doctrine, suggesting that the US’s victory in liberal democratic politics had been complete. Subsequently, during the globalization process, the US elite wrongly believed China could also transform politically through economic engagement.
This viewpoint and approach opened the door for China to steal Western technologies through various legitimate or illegitimate means.
Feng Chongyi elaborated that after the collapse of the Soviet Union and the end of the first Cold War in 1989, the US declared the end of the Cold War. China announced its reform and opening up policy, akin to the New Economic Policy of the former Soviet Union; both were equally poisonous. As capitalists aimed to make money, they eagerly eyed the Chinese market. Hence, once the country opened up, they rushed in to do business and make money. Companies from Germany, Japan, and the US entered China on a large scale, bringing in funds and technology comprehensively.
Feng Chongyi added that China, utilizing Western capital groups, overtly exchanged market access for technology, while covertly acquiring foreign companies, sending a large number of tech personnel, and massively stealing intellectual property. Companies like Huawei, masquerading as private enterprises, had unlimited bank loans. With access to endless borrowing, they leveraged national capabilities to deceive globally.
Feng Chongyi mentioned the immense risks for foreign tech companies when acquired by Chinese firms. As long as the realization of a true Cold War with China is confirmed, countries would take legitimate measures to prevent technology transfer and exports. However, if this perception is absent, and China is viewed merely as a trade partner, issues would arise. Consequently, tech companies from the West engaging with China would be considered legal and permissible.
“Western countries, if not considering China as a Cold War opponent or enemy, would not be on guard, especially many European countries like the Netherlands and France, creating convenient avenues for China to steal their core technology blatantly.”
Reviewing China’s technological development history since its founding, it is fraught with imitation and theft of Western technology cases.
China’s recently proposed “Five-Year Plan” discussion urges the adoption of “extraordinary measures” in technology to advance key core technologies such as integrated circuits. This language undoubtedly reveals China’s intentions and ambitions.
Sun Guoxiang mentioned that China has always viewed absorbing foreign technology as a typical strategy for overtaking others, described as extraordinary speed or overtaking on curves.
China has listed semiconductors, electric vehicles, artificial intelligence, aerospace, among others, as strategic industries, encouraging SOEs and private enterprises to acquire foreign technology and production capabilities and quickly integrate them into China’s domestic supply chains. This shortened catch-up schedule discards slow research and development or self-innovation models.
He believed that Chinese enterprises excel in industrializing and scaling existing technology, lowering unit costs, and aggressively entering global markets using policies and financial leverage to erode global market shares. It is not about indigenous technological research and development.
Regarding the lack of creativity, Sun Guoxiang said that while some individuals in mainland China work hard, obtaining existing technology from other countries significantly shortens their developmental processes. He cited examples such as the J-35 fighter jet theft in 2018 and 2019 from Lockheed Martin, Tesla’s lab allegedly losing robot technology to Chinese personnel, and Australia halting its massive cooperation on submarine exploration technology with China in 2020.
Sun Guoxiang explained that China has dedicated reverse engineering techniques and uses civil-military integration to introduce overseas civilian technologies for military purposes. For instance, the electromagnetic launch system on the Liaoning aircraft carrier came from 2002 Shanghai Maglev train technology developed by Germany’s Siemens, integrating the maglev track into an electromagnetic launch system.
Feng Chongyi highlighted that authoritarian states lack freedom of thought, speech, and academic freedoms, leading to a lack of originality. Without these freedoms, creativity diminishes, and without institutional protection for intellectual property rights, there is no incentive for innovation. Unlike Western capitalism, which ensures knowledge protection through established institutions, China lacks such mechanisms and therefore resorts to widespread cheating and plagiarism.
“This is a systemic issue that hampers originality. Every year China announces numerous achievements that are all empty because they misappropriate developed capitalist democracy technology by compulsory technology transfer and blatant theft abroad, packaging it domestically and presenting it for domestic patent approval, one level deceiving another.”
The Nexperia semiconductor incident is the latest example of the technology war between European countries and China since the time of Trump 1.0.
By reviewing the timeline, it is evident that China reached its peak in acquiring Western, especially EU countries’ technology companies in 2016, considered the “Year of Chinese Capital in Europe.” Astonishing acquisitions included Geely’s $18 billion purchase of a 100% stake in Volvo, ChemChina’s $30 billion acquisition of Syngenta, Midea’s €11.5 billion acquisition of KUKA Robotics, shocking the world.
Subsequently, European countries notably tightened policies, blocking all “red capital” acquisitions of European companies.
Since 2020, the Italian government has adopted a tough stance on Chinese acquisitions of Italian companies.
In 2015, ChemChina acquired a 37% stake in the famous Italian tire company Pirelli for €7.1 billion. In October 2024, the Meloni government deprived ChemChina of its rights substantially based on the “Golden Power” Act. Meloni also halted the joint venture plan of Italian company Manta Aircraft with Shenyang Aircraft from China to develop two prototypes of civilian aircraft.
Germany follows a similar path. In July 2024, Germany blocked Volkswagen from selling its gas turbine business to China Shipbuilding Group (CSSC) citing national security reasons. In November 2022, and also based on security concerns, Germany blocked China’s Siltech Sweden subsidiary Silex from acquiring Elmos, a chip manufacturer headquartered in Dortmund. In February 2018, China State Grid intended to purchase a 20% stake in the German power grid operator 50Hertz, which was ultimately thwarted.
However, Feng Chongyi believes that European countries are possibly only dealing with individual cases at the enterprise level and have not yet escalated to the national level.
He stated that national level escalation would mean countries like the Netherlands, the EU, and the UK setting up export control lists similar to those of the US. Because there are no technological barriers between these countries and the US, failing to adopt measures leaves open a backdoor for China.