China intensifies its criticism of the US chip equipment legislation as Trump lands in Beijing.
On the eve of the Xi summit, Beijing's foreign ministry criticized the MATCH Act, emphasizing a 150-day alignment deadline for Japan and the Netherlands that is central to the legislation. The comments from the foreign ministry came as Donald Trump arrived in the Chinese capital for a state visit and discussions with Xi Jinping, where they plan to address trade, AI, export controls, Taiwan, and the war in Iran, with semiconductor equipment being one of the most advanced topics.
The MATCH Act, introduced by Representative Michael Baumgartner on April 2 and later supported in the Senate by Pete Ricketts, Andy Kim, Jim Risch, and Chuck Schumer, received approval from the House Foreign Affairs Committee on April 22. China's Ministry of Commerce warned that the bill would "severely disrupt the international economic and trade order."
The legislation specifically mentions companies like SMIC, Huawei, Hua Hong, CXMT, and YMTC as "covered facilities," prohibiting exports of deep-ultraviolet immersion lithography equipment that ASML currently sells to China. It would also bar allied companies from servicing already installed machines, which would gradually weaken China's manufacturing capacity as DUV systems require ongoing maintenance.
A significant aspect of the act is that it grants the Netherlands and Japan a 150-day period to align their export regulations with those of the U.S., or they would face unilateral actions through an expanded Foreign Direct Product Rule. ASML has indicated that its revenue from China is expected to drop to about 20% in 2026 from 33% the previous year, and if the MATCH Act is enacted, the decline could be much steeper. Companies like Applied Materials predict up to $710 million in lost revenue from China this fiscal year, while Lam Research anticipates that China's share of its revenue will fall below 30%.
China's response measures are already established. In April, the State Council issued Order No. 834, a supply-chain security regulation overseen by over 15 agencies, allowing legal action against firms seen as harming Chinese supply chains. Over the past 18 months, Beijing has imposed varying restrictions on gallium, germanium, antimony, several medium and heavy rare earths, and silver, while requiring domestic chipmakers to procure half of new equipment from Chinese manufacturers—a policy that could jeopardize about $18 billion in annual sales of American equipment.
The MATCH Act contrasts with the previous actions of the executive branch. In January, the Trump administration changed its export review policy regarding Nvidia's H200 and AMD's MI325X from a presumption of denial to a case-by-case assessment, a relaxation advocated by Nvidia's CEO Jensen Huang, who was added to Trump's Beijing delegation after initially being excluded. Where the White House eased controls on finished chips, Congress is tightening restrictions on manufacturing tools, driven by the belief that lithography systems are more difficult to redirect than commodities.
Allied nations are still evaluating the implications of the 150-day rule. Japan, which imposed controls on 23 categories of chip equipment in 2023, and the Netherlands, which restricted ASML's EUV and some DUV exports since 2024, must extend these regulations within five months or face U.S. enforcement actions against any firm utilizing American technology in its supply chain.
The discussions at the summit are not likely to alter the legislative schedule. The MATCH Act has progressed to the full House stage and boasts a bipartisan nature, making it one of the few significant China-related bills advancing without significant internal dissent. Beijing appears to believe that the summit provides a prime opportunity to publicly set the stakes of the act's passage while postponing potential retaliatory actions. The Trump-Xi meeting is set to commence Thursday morning, Beijing time.
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Beijing intensified its condemnation of the US MATCH Act, which aims to impose stricter export controls on chip equipment and obligate Japan and the Netherlands to adhere to a 150-day timeline.