Dutch and German Regulators Scrutinize Nexperia Transactions Amid US Export Pressures

Dutch and German authorities are taking action in the semiconductor sector, underscoring the growing need to address supply-chain concerns. US approaches to export controls and foreign investment screening appear to be having a knock-on effect in Europe. Companies should monitor evolving national security and supply-chain frameworks across jurisdictions.

The Dutch government’s control over Nexperia’s administration, citing security and supply-chain risks, signals a potential shift in EU member states’ approach to US-China tech tensions. In that context, albeit independently, the German Federal Cartel Office (Bundeskartellamt) has approved a temporary information exchange platform for the automotive industry to manage semiconductor shortages,[1] highlighting a flexible regulatory approach in response. This decision might be an indicator of future EU member state (and possibly EU) measures as the bloc is forced to confront and adapt to geopolitical tensions affecting supply chains.

This development serves as a reminder that companies with sensitive technologies and non-EU ownership should regularly review their investment-screening risk profile, governance arrangements, supply chains, and escalation protocols to prepare for potential government oversight or intervention.

BACKGROUND: THE DUTCH GOVERNMENT’S INTERVENTION IN NEXPERIA

Wingtech, a Chinese-listed company, acquired Nexperia in 2019, before the Netherlands had a formal national security investment review mechanism. The transaction therefore escaped ex-ante FDI screening, leaving Nexperia as one of the few Chinese-controlled semiconductor manufacturers in Europe. The company’s later expansion (including its 2021 acquisition of the Newport Wafer Fab in the United Kingdom, which the UK government later ordered divested) added to the political sensitivity around Chinese ownership of European chip assets.

In December 2024, the US Department of Commerce Bureau of Industry and Security (BIS) placed Wingtech on the Entity List, citing risks of diversion to China’s military end-use sector. In September 2025, BIS adopted the Affiliates Rule, automatically extending these restrictions to majority-owned subsidiaries, such as Nexperia, once the short transition period expires. By June 2025, US officials reportedly told The Hague that Nexperia would remain subject to US controls unless its Chinese CEO, Zhang Xuezheng, was replaced and greater corporate separation from Wingtech was demonstrated.

When Zhang declined to resign, the Dutch Ministry of Economic Affairs and Climate Policy invoked its Goods Availability Act (Wgv) on September 30, 2025—the first use of this law in a technology case. The order suspended Zhang’s management authority for one year, transferred Wingtech’s shareholder voting rights to a state-appointed trustee, and barred Nexperia from transferring assets, appointing new executives, or making strategic decisions without ministerial approval. Furthermore, the Amsterdam Enterprise Chamber suspended Nexperia’s CEO, reinforcing the focus on governance and security. These measures effectively froze Wingtech’s corporate control of Nexperia. Dutch filings cited governance failures, including Zhang’s removal of the CFO, lack of contingency planning for sanctions exposure, and increased intra-group transactions with Chinese affiliates.

THE IMPERATIVE TO ADDRESS SEMICONDUCTOR SHORTAGE

The semiconductor shortage severely impacts the EU automotive industry, causing production delays, increased costs, and significant supply-chain disruptions. The US-induced Dutch action prompted China to prohibit Nexperia semiconductor exports from China to the EU, leading to immediate supply constraints in the EU car industry,[2] similar to the crisis during the COVID-19 pandemic. This also resulted in a rare public statement on an individual case by the European Automobile Manufacturers’ Association (ACEA) calling for EU government action to mitigate semiconductor shortage in Europe.[3]

In response, the industry has mobilized by establishing information-sharing platforms, forming strategic partnerships with semiconductor manufacturers, and advocating for supportive EU policies. Companies are also investing in resilient supply-chain strategies and collaborative R&D to mitigate future risks.

Such efforts have been met with approval by European regulators. In response to semiconductor shortages resulting from the Nexperia situation, the Bundeskartellamt approved a platform for the automotive industry to exchange information on remaining supplies.

Andreas Mundt, president of the Bundeskartellamt, stated that:

“In view of the impending shortage situation, the planned information exchange platform can contribute to improving the distribution of products and deferring production constraints for as long as possible, which would ultimately benefit not only the industry but also end consumers. Due to the project’s specific design, we do not have any serious competition law concerns and were therefore able to respond quickly to the VDA’s request for guidance.”

The Bundeskartellamt’s decision underscores the importance of maintaining competitive markets while allowing for permissiveness in extraordinary circumstances and could be a model to follow by other antitrust agencies as effective competition is increasingly impacted by trade disputes.

IMPLICATION ON EU LAW AND EU ANTITRUST ENFORCEMENT

The Dutch Government’s Intervention and EU Freedoms and Principles

Recourse to national security concerns is an established tool to derogate from EU laws.[4] It has been used by EU member states in merger proceedings (Article 21 Council Regulation (EC) No 139/2004 of January 20, 2004 on the control of concentrations between undertakings (the EU Merger Regulation) and the concept of national security is inherent to the member state foreign direct investment (FDI) rules.

However, the European Commission (the Commission) has consistently objected to abusive recourse to such concepts where alleged security risks could not be proven or where other objectives were the real aim.[5] The bar is high for such derogations. The internal market rules require a “genuine and sufficiently serious threat” to a “fundamental interest of society” to justify exceptional actions.[6] The burden of proof falls on the Dutch government in this specific case. Moreover, the proportionality of the measure and compliance with other fundamental principles of EU law, like the principles of legal certainty or non-discrimination, will also have to be addressed by the Dutch government.

Additionally, discrimination based on nationality is a broader World Trade Organization concern, as it is prohibited by national treatment (treating foreign and domestic goods/services equally) and most-favored-nation (treating all trading partners equally) principles. Bilateral Investment Treaties (BIT) also address nationality-based discrimination, often through similar national treatment and most-favored-nation provisions, as well as other ad-hoc clauses. This is the case of the BIT between China and the Netherlands (e.g., see its Article 5(1)b).[7]

The Bundeskartellamt’s Decision and EU Antitrust Law

From a competition law perspective, the Bundeskartellamt's decision to approve a temporary information exchange platform for the automotive industry highlights several key considerations.

The approval demonstrates a pragmatic approach to addressing urgent supply-chain disruptions. By allowing the platform, the Bundeskartellamt shows flexibility in applying competition laws to support industry stability during crises.

The platform includes several safeguards (measures such as anonymization of offers, no price signaling, and operation by a neutral body) that are crucial to ensure that the platform does not facilitate anti-competitive behavior, such as price-fixing or market allocation.

The decision to limit the platform's duration to six months reflects a careful balance between addressing immediate supply needs and preventing long-term market distortions. This time-bound approach helps mitigate potential antitrust concerns.

The Bundeskartellamt's decision could serve as a model for future regulatory responses to supply-chain crises, emphasizing how competition authorities can adapt rules to maintain market function without compromising competitive integrity.

Finally, by facilitating information exchange, the platform may help stabilize the market, but it also requires ongoing monitoring to ensure it does not inadvertently lead to collusion or reduced competition.

COMPLIANCE AND STRATEGIC TAKEAWAYS

Companies should be implementing more robust and resilient operational practices for the immediate and longer terms. Mainly they should consider taking the following steps:

• Strengthen governance and IP controls in their EU subsidiaries
• Make supply chains more diversified and resilient
• Prepare for replication of similar measures by other member states
• Prepare for potential legal challenges regarding proportionality and nondiscrimination
• Monitor further EU guidance on economic security strategies
• Engage with national authorities on security priorities

The Nexperia case will test how far EU member states may go in revisiting previously cleared transactions on national-security grounds, and what limits courts will place on retroactive intervention and corporate governance disruption. It also highlights growing alignment between European screening measures and US export-control policy, raising questions about coordination and sovereignty. Companies in strategic sectors should expect continued scrutiny across ownership structures and affiliates and monitor potential EU-level guidance as policymakers balance security concerns with investment predictability.

HOW WE CAN HELP

Our trade team lawyers are closely monitoring the developments in all relevant jurisdictions and are well suited to advise companies on these issues and help engage with stakeholders in their respective jurisdictions.

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