Dutch chip toolmaker ASML has revealed an worker in China just lately stole details about its expertise which can have resulted in export controls being violated, in an incident that underscores the corporate’s significance within the world battle to supply superior semiconductors.

ASML, the worldwide chief within the manufacturing of so-called lithography machines that use gentle to etch semiconductors, mentioned in its annual report on Wednesday that it had been “topic to misappropriation of knowledge referring to proprietary expertise by a (now) former worker in China”. 

“Though we don’t consider that the misappropriation is materials to our enterprise, sure export management laws could have been violated,” it added, provided that current worldwide export controls relate to the availability of knowledge in addition to bodily instruments.

The corporate mentioned it had reported the incident to the Dutch and US authorities.

ASML, the biggest tech firm in Europe with a market capitalisation of €248bn, holds a singular and essential place within the chip provide chain as the one firm capable of make extremely subtle excessive ultraviolet lithography (EUV) machines. It has additionally discovered itself entangled within the commerce conflict between Washington and Beijing since 2019 when a cargo of considered one of its EUV machines to China was blocked.

The difficulty of IP theft and tech switch shouldn’t be new to ASML. Its final annual report flagged considerations {that a} Chinese language firm specialising in merchandise to enhance chip yields had doubtlessly infringed its mental property, although the incident in query passed off in 2015.

After a concerted lobbying effort by the US, the Dutch and Japanese governments agreed final month to additional tighten their restrictions on sure instruments and applied sciences that would help the growth of China’s superior chip sector.

Peter Wennink, ASML’s chief govt, mentioned in a press release accompanying the report that he understood that these new measures “cowl superior lithography instruments in addition to different varieties of gear”.

“On a geopolitical degree, the bifurcation of socio-economic blocks — with the related export and import controls — is threatening the event of the worldwide village that contributed a lot to a number of the innovation we’ve got seen lately,” he mentioned. “If nations or commerce blocks withdraw into their very own territories, then innovation will likely be much less efficient and dearer.” 

He famous nevertheless that he didn’t count on these new measures to have a fabric affect on ASML’s enterprise for 2023.

Final month, the toolmaker reported a file order backlog of greater than €40bn and forecast that gross sales would improve by 25 per cent this 12 months. Wennink mentioned that any gross sales misplaced via export controls may very well be recouped by promoting to prospects in its rising backlog.

Given ASML’s efficient monopoly on the superior machines required to make superior chips, some analysts have questioned whether or not intensifying restrictions may turbocharge China’s efforts to develop its personal home toolmaking business.

In December of final 12 months, Huawei reportedly filed a patent utility for some of the superior sides of an EUV machine.