Chinese electronic-parts supplier Wingtech is the latest company to face a setback amid the U.S.-China tech war, after Dutch authorities froze control of its local subsidiary in a sign of new risks for Chinese tech firms’ overseas investments. Semiconductor manufacturer Nexperia, a European unit of the Chinese tech company, is under temporary external management following an order from the Dutch Ministry of Economic Affairs, Wingtech said in a stock exchange filing.
The rare move by local authorities was the latest example of increasing operational risks for Chinese tech companies amid intensified U.S.-China tensions, analysts said. A commentary on the Chinese website Guancha.cn said that the case was a warning shot to all Chinese businesses venturing abroad for risks of “commercial issues being politicized”. Some analysts said the move by the Dutch Ministry resulted from a new rule issued by the U.S. Bureau of Industry and Security, the agency responsible for export control. The rule, effective September 29, imposed new restrictions on entities which are at least 50% owned by enterprises on the Entity List or the Military End-User List – two blacklists issued by the U.S. government.
Wingtech was added to the Entity List in December 2024, meaning American companies are prohibited from exporting or transferring U.S.-origin goods, software or technology to Wingtech or its subsidiaries without a special license. The latest rule applied the restrictions to companies owned by listed entities. In a statement on Wingtech’s WeChat account, the company lashed out at the Dutch action and the claim it was taken for reasons of “national security”. The company said the court ruling was an attempt by “individual members of Nexperia’s foreign management” to forcibly change the company’s equity structure through legal proceedings. “Essentially, they are trying to use political pressure to deprive shareholders’ rights and subvert the company’s legitimate governance structure,” the statement said.
Founded in 2006 by Zhang Xuezheng, an industry veteran with a background in tech companies including STMicroelectronics and ZTE, Wingtech has evolved into a key supplier to major consumer-electronics companies including Apple. The company, based in Jiaxing in Zhejiang province, has doubled down on its semiconductor business over the past few years. In 2018, it announced the acquisition of Nexperia for USD3.6 billion, a landmark deal in China’s semiconductor industry that helped turn the company into a key player in the global power-chip market. In December, weeks after it was added to the U.S. Entity List, it said it would divest its consumer-electronics contract manufacturing business by selling nine wholly-owned subsidiaries to the parent company of Luxshare Precision Industry, another Chinese Apple supplier, in a move to focus on semiconductors owing to “changes in the geopolitical environment”, the South China Morning Post reports.
