Dutch Government Set to Reverse Stance on Nexperia
The Netherlands government is preparing to suspend its special oversight powers over Chinese-owned semiconductor manufacturer Nexperia, but only if Beijing permits the company to resume exporting critical chips that have become essential for global automotive production.
According to sources familiar with the matter who spoke with Bloomberg, Dutch authorities are ready to shelve a ministerial order that granted them authority to block or modify crucial corporate decisions at Nexperia. The breakthrough could resolve an escalating dispute that has threatened to disrupt car manufacturing worldwide.
Constructive Talks Lead to Potential Resolution
Dutch Economic Affairs Minister Vincent Karremans expressed optimism about the situation in an official statement released on Thursday, November 6. "Given the constructive nature of our talks with the Chinese authorities, the Netherlands trusts that the supply of chips from China to Europe and the rest of the world will reach Nexperia's customers over the coming days," Karremans stated.
If chip shipments restart and confirmation arrives in the coming days, Dutch authorities are prepared to revoke their special powers as early as next week, according to the people familiar with the negotiations.
Origins of the Conflict
The dispute began in late September when Minister Karremans invoked a Cold War-era law to grant the Dutch government unprecedented oversight of Nexperia's decisions. The minister, who serves in the Netherlands' caretaker administration, cited serious concerns that Wingtech - Nexperia's Chinese parent company - was limiting the chipmaker's operations and threatening supplies of essential components.
Karremans specifically pointed to actions by Wingtech founder Zhang Xuezheng that he characterized as "misuse of financial resources for the CEO's self-enrichment as well as his other companies in China." These allegations were strongly denied by Wingtech, which demanded Zhang's reinstatement as Nexperia's CEO.
The conflict escalated when an Amsterdam court suspended Zhang on October 7 following a petition by Nexperia management, further complicating the corporate governance situation.
Consequences and Global Impact
The Dutch government's intervention provided authorities with the power to block or change major decisions at Nexperia for up to one year. These powers included authority over relocating company operations and dismissing key executives.
Beijing responded decisively by restricting exports of Nexperia products from China, which represented approximately half of the company's pre-crisis production volume. This move had immediate global consequences since Nexperia's Dutch unit manufactures power-control chips used by major automakers including Volkswagen.
The situation reached a critical point when Nexperia notified customers on October 29 that it had stopped direct wafer supplies to its Chinese assembly plant due to disputes over payments and control, creating uncertainty throughout the automotive supply chain.
The potential resolution comes as welcome news to the global automotive industry, which has been grappling with semiconductor shortages that have forced production slowdowns and factory closures across multiple continents.
