ASML faces potential U.S. pressure to halt DUV equipment sales to China

The United States is increasing pressure on the Netherlands to expand export restrictions on semiconductor manufacturing equipment to China. While the Netherlands has already prohibited ASML from exporting advanced Extreme Ultraviolet (EUV) lithography machines to China, new bipartisan legislation in the U.S. Congress, known as the MATCH Act, seeks to extend these bans to include Deep Ultraviolet (DUV) lithography equipment.

DUV technology, though more mature than EUV, remains critical for producing a wide range of chips used in industrial automation and various consumer electronics. If the MATCH Act passes, it could potentially prohibit not only the sale of DUV machines but also the maintenance and servicing of existing equipment already delivered to China. The U.S. aims to curb Chinese advancements in artificial intelligence, supercomputing, and military technology.

In response to these tightening controls, Chinese firms are accelerating domestic development. Shanghai Yuliangsheng Technology has reportedly begun limited production of immersion DUV lithography machines, with plans to deliver several systems by the end of 2024 and scale up production through 2027. Major Chinese chipmakers, including SMIC and CXMT, are expected to be among the primary customers for these domestic alternatives.