After the US-China summit, the Chinese Ministry of Commerce announced on Saturday (November 1st) that it will exempt some export restrictions on Nexperia chips.
A written statement issued by the Chinese Ministry of Commerce stated, “We will comprehensively consider the actual situation of companies and grant exemptions to eligible exports.”
This is one of the agreements reached during the South Korea summit between China and the US this week.
The Wall Street Journal reported earlier that, according to a framework agreement reached during the Trump-Xi meeting, the White House will announce that Nexperia’s China factories will resume chip exports.
Sources familiar with the matter said that the White House is set to release a document outlining the details of the US-China trade agreement signed this week, including a new policy related to this Dutch chip company.
According to the outcome statement released by the Chinese side at the summit, the US will suspend the implementation of the 50% rule in the September 29th export control announcement for one year, while China will suspend the related export control measures announced on October 9th for one year as well.
The US introduced the 50% rule in September, expanding the scope of export restrictions to include all subsidiaries with over 50% ownership by sanctioned companies. Nexperia’s Chinese parent company, Wingtech Technology, was blacklisted in December 2024. This also means that Nexperia falls under the jurisdiction of this new rule.
In early October, the Dutch government expressed concerns that Wingtech Technology would transfer its chip manufacturing business to China, causing Europe to lose one of its largest chip manufacturers. Based on the Dutch Trade and Industry Act, the Netherlands requested a ban on Nexperia and its global affiliated entities from making adjustments to assets, intellectual property, business, personnel, and more within a year. Almost simultaneously, a Dutch court ordered the suspension of Wingtech CEO Zhang Xuezheng’s duties at Nexperia during a civil lawsuit investigation.
Subsequently, China announced a ban on chip exports from Nexperia’s Chinese factories.
Around 70% of Nexperia’s products are assembled in its Dongguan factory, with these low-end chips widely used in the automotive and consumer electronics sectors.
Nexperia’s Chinese subsidiary then informed employees and customers to disregard instructions from the Dutch headquarters and begin independent operations.
Due to Beijing’s restrictions on Nexperia chip exports, there have been chip shortages in the automotive industry, leading Honda to temporarily halt production at its factories in the US and Mexico. Additionally, Volkswagen has warned that disruptions in Nexperia chip supply could impact production.
The Motor & Equipment Manufacturers Association (MEMA), the largest automotive parts supplier in the US, also stated that due to the conflict between the Netherlands and China over chip manufacturer Nexperia, American car manufacturers are only two to four weeks away from production stoppage.