The Netherlands takes a big step to defuse its dispute with China that threatened car production

By Ana Nicolaci da Costa, CNN

London (CNN) — A high-stakes standoff between China and the Netherlands over control of a crucial chipmaker reached a detente Wednesday after Amsterdam suspended a controversial order that enabled it to take control of Chinese-owned Nexperia.

The standoff had threatened to shutter auto plants around the world as Nexperia is a critical supplier of computer chips to the global auto industry.

The Dutch government said it had suspended the order after “constructive” meetings with Chinese authorities and that it would continue speaking to them.

Amsterdam took control of Nexperia in late September, under pressure from the US government, which had placed its Chinese parent company, Wingtech Technologies, on a blacklist of companies seen as posing a national security threat. Nexperia’s CEO was also suspended from his post following a court order.

Last month, Beijing suspended shipments of Nexperia chips from China, raising fears that automakers in the United States and Europe would run out of the components. China has since agreed to allow the export of chips critical to auto production.

“In light of recent developments, I consider it the right moment to take a constructive step by suspending my order… regarding Nexperia, in close consultation with our European and international partners,” Dutch Economic Affairs Minister Vincent Karremans said Wednesday in a statement.

“In the past few days we have had constructive meetings with the Chinese authorities. We are positive about the measures already taken by the Chinese authorities to ensure the supply of chips to Europe and the rest of the world. We see this as a show of goodwill.”

China’s commerce ministry welcomed Amsterdam’s decision, saying in a statement that it was “a first step in the right direction toward a proper resolution.”

Maroš Šefčovič, who oversees the European Union’s trade policy, also welcomed the Dutch government’s move, saying on X that it represents “another key step in stabilizing our strategic chip supply chains.”

Nexperia is a critical supplier for the global auto industry, providing 40% of the automotive chips in the market segment that includes transistors and diodes, according to research firm TechInsights.

The US Commerce Department put Wingtech on the list of companies facing trade restrictions last December.

The Dutch government said last month that it had taken control of Nexperia, citing economic security concerns.

China, meanwhile, imposed export controls in early October barring Nexperia and its affiliates from exporting some components manufactured in China.

After a landmark meeting between US President Donald Trump and Chinese leader Xi Jinping late last month, Beijing said it would allow exemptions from the recently imposed export control on computer chips.

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Olesya Dmitracova contributed reporting.