Focus: China criticizes US chip equipment bill in run-up to Beijing talks

• The MATCH Act targets key chipmaking tools from allied countries like ASML (Netherlands) and Tokyo Electron (Japan), with mechanisms to coerce allies to limit exports and requirements for licenses to service equipment in China
• China issued a decree on April 13 establishing a 'Malicious Entity List' that could be used to target those who promote or implement foreign extraterritorial measures, opening the door to legal action
• The bill passed the House Foreign Affairs committee with a 36-8 vote in late April after revisions following industry lobbying, though the White House has not publicly taken a position on the legislation

Summary

China is mounting significant opposition to the U.S. MATCH Act, proposed legislation targeting Chinese chipmakers' ability to compete in the AI semiconductor race. The bill is expected to be discussed during upcoming talks between President Trump and Chinese President Xi Jinping in Beijing this week—their first meeting since a fragile trade truce in South Korea.

Key Legislative Details:

The MATCH Act, introduced in both the House and Senate last month, aims to restrict Chinese access to critical chipmaking equipment from the U.S., Japan, and Netherlands—the three countries dominating the market. The bill advanced from the House Foreign Affairs Committee with a 36-8 vote on April 22. If foreign countries don't limit exports within months of enactment, the U.S. could impose unilateral controls, including licensing requirements for equipment servicing.

Chinese Response:

Beijing has taken unprecedented steps showing the gravity of its concerns:

• Summoned U.S. embassy diplomats in China to lodge formal complaints
• Called U.S. chip industry representatives to meetings at China's Washington embassy in April
• Issued a decree on April 13 creating a "Malicious Entity List" for those implementing extraterritorial measures
• Publicly threatened "decisive" countermeasures if the bill becomes law

Companies Impacted:

Netherlands-based ASML, the dominant supplier of deep ultraviolet immersion lithography equipment, and Japan's Tokyo Electron are primary targets. Micron, the largest U.S. memory chipmaker, reportedly engaged in lobbying efforts.

Market Implications:

The legislation represents Congress filling a policy gap while the Trump administration has avoided imposing new tech export regulations despite national security concerns. The White House has not publicly taken a position on the bill.