28 October 2025, Geneva

Situation Overview

A diplomatic and economic confrontation has erupted between the Netherlands and China over Nexperia, a Chinese-owned semiconductor manufacturer headquartered in Nijmegen. 

In late September, the Dutch government took the extraordinary step of assuming temporary control of Nexperia’s governance by invoking the rarely used Goods Availability Act, a move designed to prevent the transfer of critical technological knowledge, assets, and capabilities out of Europe. The action followed the identification of serious governance deficiencies that threatened the company’s continuity and raised national-security and dual-use concerns.

Beijing denounced the move as discriminatory and warned of "serious consequences," swiftly imposing retaliatory export curbs on finished Nexperia components manufactured in China. The dispute has since escalated beyond a bilateral quarrel: Brussels and Washington are coordinating responses, while European manufacturers, particularly in the automotive sector, are assessing potential knock-on effects amid already strained semiconductor supplies. What began as a regulatory intervention by a mid-sized European state has evolved into a flashpoint for the geopolitics of technology dependence and economic leverage.

Strategic Significance

Europe’s Balancing Act: The episode captures the EU’s struggle to preserve open markets while asserting technological sovereignty and aligning with U.S. export-control regimes.

Weaponized Interdependence: China’s ownership of firms embedded within Western, mission-critical supply chains enables coercive leverage through component dependencies, underscoring systemic risk.

Global Fragmentation: The semiconductor ecosystem continues its split into Western, Chinese, and non-aligned blocs, which is raising costs, complicating innovation, and fragmenting trade norms.

Regulatory Precedent: The Dutch move establishes a template for future aggressive interventions, including outright corporate seizure, across critical technologies such as AI chips, photonics, and sensors, potentially extending to software and IP licensing controls.

Strategic Indicators to Watch

• The degree of EU alignment with U.S.-style export-control regimes and how far Europe is willing to trade competitiveness for sovereignty.

• The scope and duration of Beijing’s retaliatory export measures, and whether they expand beyond Nexperia to broader semiconductor categories.

• Moves by neutral producers, such as Taiwan, Japan, and South Korea, toward explicit alignment or diversification to avoid exposure to Western secondary sanctions.

ISRS Assessment

The Nexperia dispute exemplifies synthetic asymmetry in the modern economy: localized, surgical policy shifts now generate disproportionate global impacts. Europe’s expanding use of national-security justifications for tech regulation signals a definitive pivot toward strategic autonomy. Beijing is expected to respond selectively, likely through resource leverage or targeted export curbs, to test Western cohesion without provoking full decoupling. Over the medium term, semiconductor policy has now transitioned from efficiency-driven globalism to resilience-driven regionalism, redefining what constitutes national power in the digital age.

Conclusion

The Nexperia case marks the beginning of a structural realignment in how democratic economies treat technological dependency. As nations move from open interdependence to guarded resilience, each policy decision carries amplified strategic weight. The challenge will be to balance sovereignty with innovation without hardening the very divisions that make cooperation possible.

“Technology has become the new terrain of sovereignty. The states that master control over their digital arteries without severing them will define the shape of power in the twenty-first century.”
— Dr. Dave Venable, ISRS Chair