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Japan to restrict exports of chipmaking equipment while aligning with US China restrictions ft

TOKYO, March 31 (Reuters) – Japan said on Friday it will restrict exports of 23 types of semiconductor manufacturing equipment, aligning its technology trade controls with a push by the United States to rein in China’s ability to make advanced chips.

Japan, home to the world’s top chip equipment makers such as Nikon Corp (7731.T) and Tokyo Electron Ltd (8035.T), did not specify China as the target of the measures, saying equipment makers would have to look an export permit for all. regions.

“We are fulfilling our responsibility as a technology nation to contribute to international peace and stability,” Economy, Trade and Industry Minister Yasutoshi Nishimura told a news conference.

Japan wants to stop the use of advanced technology for military purposes and does not have a specific country in mind with the measures, he said.

But Japan’s decision is seen as a major diplomatic victory for the administration of US President Joe Biden, which in October announced sweeping restrictions on China’s access to US chip-making technology to curb its technological and military advances.

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

Japan and the Netherlands agreed in January to join the US in restricting exports of equipment to China that could be used to make chips smaller than 14 nanometers, but did not announce the pact to avoid provoking China, the sources previously said.

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 generally 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. Large Dutch company ASML Holding NV (ASML.AS) dominates the market for lithography systems used to create tiny chip circuits.

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


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

The restrictions, effective from July, are likely to affect equipment made by at least a dozen Japanese companies, including Nikon, Tokyo Electron, Screen Holdings Co Ltd (7735.T) and Advantest Corp (6857.T).

Takamoto Suzuki, Marubeni’s head of economic research in China, said the measures would be a blow to Japanese equipment makers given the absence of a strong domestic chip market.

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

Asked about the impact, Minister Nishimura said, without elaborating, that he expected a limited impact on domestic companies.

Some industry watchers point to potential sales elsewhere.

“If you look at the long term, the effect will be less, with new semiconductor plants coming online in places like the United States and Japan,” said Takahiro Shinada, a professor at Japan’s Tohoku University.

Japan, which once dominated chip production but has seen its market share fall to around 10%, remains a major supplier of chip-making machines and semiconductor materials. Tokyo Electron and Screen make about a fifth of the world’s chip-making tools, while Shin-Etsu Chemical Co Ltd (4063.T) and Sumco Corp (3436.T) make the majority of silicone wafers.

Shares of Nikon and Advantest rose 0.8% and 1.9% respectively after the news, in line with the overall market (.N225) gain of 1.1%. Tokyo Electron and Screen were little changed.

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

Tokyo Electron and Advantest declined to comment.

Reporting by Tim Kelly, Miho Uranaka, Kiyoshi Takenaka, and Mayu Sakoda; Edited by Christopher Cushing

Our standards: The Thomson Reuters Trust Principles.



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