ASML, one of many world’s most important semiconductor companies, mentioned Wednesday that it not too long ago found {that a} former worker in China had misappropriated knowledge associated to its proprietary know-how.

The Dutch agency mentioned that it doesn’t imagine the alleged misappropriation is materials to its enterprise.

“We’ve got skilled unauthorized misappropriation of knowledge referring to proprietary know-how by a (now) former worker in China,” ASML mentioned in its annual report.

“Nevertheless, on account of the safety incident, sure export management laws could have been violated. ASML has due to this fact reported the incident to related authorities.”

The info that was misappropriated concerned paperwork. ASML didn’t broaden on the main points.

The safety incident comes at a delicate time for ASML and the federal government of the Netherlands which has been caught in the midst of a battle for tech supremacy between the U.S. and China. Semiconductors are very a lot a part of that rivalry.

ASML holds a singular place within the chip provide chain. The corporate makes a device known as an excessive ultraviolet lithography machine that’s required to take advantage of superior semiconductors, comparable to these manufactured by TSMC. ASML is the one firm on the planet that produces this piece of package.

The U.S. is fearful that if ASML ships the machines to China, chipmakers within the nation might start to fabricate probably the most superior semiconductors on the planet, which have in depth navy and superior synthetic intelligence purposes.

Since 2018, the U.S. has reportedly put stress on the Dutch authorities to cease ASML transport EUV machines to China. ASML has by no means shipped the device to China.

Final month, Bloomberg reported that the U.S. reached an settlement with Japan and the Netherlands to limit exports of superior chipmaking equipment to China.

ASML mentioned the settlement might cowl its superior chipmaking instruments however it doesn’t count on the measures to have a fabric impact on its 2023 expectations.

“We perceive that steps have been taken that may cowl superior lithography instruments in addition to different kinds of gear. The phrases of this settlement haven’t been publicly disclosed and stay confidential for now. We count on that it’ll take many months for the governments to put in writing and enact new guidelines,” ASML mentioned Wednesday.

In 2021, the ASML alleged an organization known as Dongfang Jingyuan Electron “was actively advertising merchandise in China that might doubtlessly infringe on ASML’s IP rights.”

ASML alleges that Dongfang Jingyuan Electron is related to XTAL Inc., an organization in opposition to which ASML had obtained a injury award for commerce secret misappropriation in 2019 within the U.S.

Donfang Jingyuan Electron has denied experiences about mental property theft.

ASML mentioned in a separate assertion Wednesday that it’s seeing an elevated variety of makes an attempt from actors attempting to steal its know-how.

“With ASML’s distinctive place and the rising geopolitical tensions within the semiconductor business, we see growing safety danger tendencies, starting from ransomware and phishing assaults to makes an attempt to accumulate mental property or disrupt enterprise continuity,” a spokesperson mentioned.

China in the meantime is attempting to spice up its personal semiconductor business in opposition to a backdrop of rising pressure with the U.S. However China’s chip capabilities stay far behind the likes of the Taiwan, South Korea and the U.S.

China doesn’t have any corporations that may produce the instruments that ASML does. With out ASML’s equipment, will probably be troublesome for China to fabricate probably the most superior chips. In the meantime, the U.S. launched sweeping export restrictions in October aimed toward chopping China off from acquiring or manufacturing key chips and parts. Consultants beforehand instructed CNBC that these elements would possible hobble China’s drive to spice up its home chip business.