ASML supplied product to military research institute in China
Last year, ASML sold an essential chip machine part to a military research institute of CETC, one of China's key defence companies. A Chinese quantum institute was also a customer. This has become clear from research done by Nieuwsuur based on confidential documents.
ASML's supplies to these Chinese customers are striking. In 2023, the Dutch government wrote that there is a significant risk that Dutch advanced technology may be used for "the development of Chinese military technology and may be deployed in the violation of human rights by the Chinese state."
It is because of these concerns that the export of chip machines and parts is subject to strict export rules. A product cannot leave the country without authorization. But it turns out that part of the products that were the subject to the Nieuwsuur research are not subject to those rules.
Rocket systems and drones
The military research institute that bought a product from ASML is a division of China Electronics Technology Group Corporation (CETC), a Chinese state-owned company. It is one of China's key defence companies. The Chinese government calls it a "military-industrial group". CETC designs and manufactures high-quality military technology, for use in, for example, rocket systems and drones.
The institute, that goes by the name of "24th Research Institute of CETC", is based in the metropolis of Chongqing. In 2024, it bought a part in order to set a chip machine.
The military ties of the institute are no secret. According to its own brochure, the institute is home to the only national laboratory for military computer chips in China. And according to a local government, this institute also worked on the Chinese space program Shenzhou and the Tiangong space station.
The 24th Research Institute did not respond to questions from Nieuwsuur.
Complete chip machine to quantum institute
Our research shows that, in 2024, ASML had another notable customer in China: a quantum technology research institute. The Dutch Military Intelligence and Security Service (MIVD) explicitly warns against the development of quantum technology by China.
The institute concerned is the Shenzhen International Quantum Academy, which, according to import and export data, received a "Deep UV lithography machine" (DUV) from ASML on 5 February 2024.
On its website, the institute states that its activities include research into "quantum sensing". This is a technology that is used to perform extremely accurate measurements. In its latest annual report, the MIVD explicitly warned against the interest that the Chinese are showing in quantum sensing. According to the MIVD, this technology can be used for military purposes, for example quantum radars to detect submarines, which "negates their greatest strength: 'stealth'".
"It is clear that this is sensitive technology", says Rem Korteweg, geopolitics expert for the Clingendael Institute, on the supply of a DUV machine to the institute. "When I see this, I really wonder: what were the reasons to execute this order? Knowing that quantum is one of the most promising sectors, and that there are huge concerns as to what this could mean for our national security."
Rem Korteweg, geopolitics expert for the Clingendael Institute, is surprised about ASML's reaction. "Only a few companies in Europa, among which ASML, are so important to our national security on a system level that one might expect them to feel their own responsibility here and act on it."
Nieuwsuur has not been able to identify the type of DUV machine that the quantum institute has received. It is also unclear whether ASML required the prior authorization from the Ministry of Foreign Affairs in this case. Neither ASML nor the Ministry have been willing to comment on individual companies or supplies.
Ministry: not everything is crucial
The Ministry of Foreign Affairs says that, in general, the export to the Chinese defence industry is "undesirable for several reasons". In response to questions from Nieuwsuur, the Ministry writes: "In their annual reports, the Dutch intelligence agencies AIVD and MIVD have warned for years that China poses the greatest threat to Dutch economic and knowledge security. Furthermore, China has military ties to Russia, and Chinese companies supply both dual-use and military goods for the Russian war industry."
In a response to this story, the Ministry writes: "Not all high-tech goods are, by definition, sensitive and subject to authorization under the export controls policy. This is also the case for parts of lithography machines. Lithography machines contain a great deal of parts, technology, and software. All those parts are needed for a machine to work, but not all parts play a crucial/strategic role."
According to the Ministry, the Dutch export policy focuses on controlling products that are, indeed, subject to authorization. So, other products are not subject to controls, and "exporters are free to export goods to China without any controls."
The complete reaction from the Ministry can be found here.
Indeed essential
We have submitted the relevant parts, as sold to the Chinese customers of ASML concerned, to four experts. They each independently say that those parts are, indeed, crucial to the performance of a chip machine.
"The problem is that the Dutch government does not have any control over this export of parts", says Judith Huismans, China expert for RAND Europa and former head researcher for Datenna. She says that an option could be to impose an overall export restriction on parts for chip machines. "That way, you are not saying that ASML can no longer export anything to China, but it will give the government more control and tools."
Nieuwsuur has been unable to identify the end products in which the computer chips are used, which are made with the ASML machines. ASML's customers in China were not willing to answer any questions on this subject.
US sanctions lists
The research done by Nieuwsuur has further revealed that, in 2024, ASML was selling products to the chip manufacturer GTA Semiconductor. This company is owned by CEC, a huge technology company, which, according to the Chinese government, is a military-industrial group.
Other customers of ASML in 2024 included chip manufacturers Si En (Qingdao) and Semiconductor Manufacturing Beijing Corporation (SMBC), a division of SMIC chip producer. The US government ties these companies to supplies to the Chinese military. For that reason, they are on US sanctions lists.
We have asked Wirescreen in the US and Datenna in the Netherlands to review ASML's customers. These firms are the primary experts worldwide when it comes to background checks of Chinese businesses. Governments turn to them when they need to review export authorizations. More information can be found in the account of our research.
