Japan said it would restrict exports of chipmaking equipment to match US restrictions in China

Japan said it would restrict exports of chipmaking equipment to match US restrictions in China

Japan said it would restrict exports of chipmaking equipment to match US restrictions in China

Japan said on Friday it would restrict exports of 23 types of semiconductor manufacturing equipment, aligning its trade controls on the technology with U.S. pressure to limit China’s ability to make advanced chips.

Japan, home to the world’s major chip-equipment makers such as Nikon and Tokyo Electron, did not specify China as a target of the measures, saying equipment makers should apply for export clearance for all chips. regions.

“We assume our responsibility as a technological nation to contribute to international peace and stability,” Economy, Trade and Industry Minister Yasutoshi Nishimura said at a press conference.

Japan wants to end the use of advanced technologies for military purposes and has no particular country in mind with such measures, he said.

But Japan’s move is seen as a major diplomatic victory for US President Joe Biden’s administration, which in October announced sweeping restrictions on China’s access to US chipmaking technology to slow its technological advances. and military.

Without the cooperation of industry heavyweights Japan and the Netherlands, US measures would be ineffective and its companies would face a competitive disadvantage.

Japan and the Netherlands agreed in January to join the United States in restricting exports of equipment to China that could be used to make sub-14 nanometer chips, but did not announce the pact for avoid provoking China, sources said earlier.

Japan has never publicly acknowledged any agreement.

A nanometer, or one-billionth of a meter, refers to a specific technology in the semiconductor industry, with fewer nanometers usually meaning the chip is more advanced.

In the Netherlands, the government said in a letter to parliament this month that it planned to restrict exports of chipmaking equipment. The large Dutch company ASML Holding NV dominates the market for the lithography systems used to create the tiny circuits of the chips.

China, which has accused the United States of being a “technological hegemony” because of its export restrictions, urged the Netherlands “not to follow the export control measures of certain countries”.

Limited impact?

Japan said it would impose export controls on six categories of equipment used in chip manufacturing, including cleaning, deposition, lithography and etching.

The restrictions, effective from July, are likely to affect equipment made by at least a dozen Japanese companies, such as Nikon, Tokyo Electron, Screen Holdings and Advantest.

Takamoto Suzuki, head of economic research for Marubeni in China, said the measures would be a blow to Japanese OEMs given the lack of a strong domestic chip market.

“It will undermine the market development of Japanese companies and certainly reduce their competitiveness from a regulatory perspective,” he said.

Asked about the impact, Minister Nishimura said, without giving further details, that he expected a limited impact on domestic businesses.

Some industry watchers point to potential sales elsewhere.

“If you take a long-term view, the effect will be diminished, with new semiconductor factories coming on stream in places like the United States and Japan,” said Takahiro Shinada, a professor at the University. Japanese from Tohoku.

Japan, which once dominated chip production but saw its market share drop to around 10%, is still a major supplier of chipmaking machinery and semiconductor materials. Tokyo Electron and Screen make about a fifth of the world’s chipmaking tools, while Shin-Etsu Chemical and Sumco produce most of the silicon wafers.

Shares of Nikon and Advantest rose 0.8% and 1.9% respectively after the news, broadly in line with the broader market’s 1.1% rise. Tokyo Electron and Screen have changed little.

“We will continue to comply with all rules and work to maximize our results within them,” a Nikon spokesperson said.

Tokyo Electron and Advantest declined to comment.

© Thomson Reuters 2023

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