The news is seldom about how local businesses are impacted by global news events. It’s not always clear what big names and decisions by national government has to do with your daily routine.

We’re a small software company based in Amsterdam, servicing mostly Dutch clients. So why would we care about world affairs?

But big business is in turmoil as never before, as a new world order is emerging. And that might have effect on our business too. And on yours.

It’s crunch time for Nexperia. And the EU’s relations with China.

It’s now January 2026, a couple of months after the shock announcement that the Dutch government had invoked the cold war era act that enabled the takeover of Nexperia. In this week’s news, it was reported that a trial had started about the case.

The Dutch Enterprise Chamber must decide whether there are “valid reasons to doubt the sound policy and business operations at Nexperia” under its Chinese ownership (Wingtech) and former CEO Zhang Xuezheng.

Nexperia’s European management team accuses Wingtech and Zhang of deliberately destabilising the company to move operations out of Europe. They claim Wingtech prioritised its own interests over Nexperia’s stability, leading to revenue drops and operational chaos.

Wingtech’s lawyers deny mismanagement, argue that the Dutch government’s intervention was unjustified and politically motivated, and that the real reasons for the minister’s actions remain unclear.

The Dutch government used the Goods Availability Act (1952) to seize control of Nexperia in September 2025, citing national security and economic risks. The court must assess whether this intervention was legally justified.

If an investigation is indeed ordered, the court could uphold the suspension of Chinese leadership and maintain Dutch oversight, possibly leading to a permanent restructuring or even a sale of Nexperia’s European operations to non-Chinese investors.

There’s more to chipmaking than the sub-2nm ones that power AI.

Nexperia is one of the many companies that produce mature node chips. These are in many appliances, your phone, your car, even your humble toaster. They’re not of the cutting edge type, but they’re very reliable. Chips in routers, chips that do power control in data centres and in individual servers, NFC chips in the dongle that opens your car.

The company was once part of NXP Semiconductors, which itself once part of the Dutch concern Philips, known worldwide as producer of electrical appliances. You might have Philips lighting in your home, but the company has been active in electronics since the acquisition of vacuum tubes manufacturer Mullard in the 1920’s, now Nexperia Manchester.

Interwoven with Philips in history and in physical location, Nexperia has subsidiaries in Hamburg, Germany, another early acquisition by Philips. Same for the location in the Philippines, started by Philips in 1981. Same for the Semiconductor Miniature Products in Malaysia, started in 1992 together with Motorola, now run by Nexperia.

And now China. But this case is different, there’s no historical legacy in China. Only when Wingtech acquired Nexperia were factories opened there.

But why open new factories in China when Nexperia could build upon decades of Philips’ legacy systems, optimised for cost, quality, and resilience?

Chipmaking has been a global effort for decades.

To understand the system, we need to look at the different aspects of chip production. What is a wafer, what’s testing and packaging?

A wafer is a thin, circular slice of semiconductor material (usually silicon) that serves as the base for manufacturing integrated circuits (chips). Wafers are fabricated in cleanrooms using photolithography, etching, and doping to create transistors and circuits. Philips/Nexperia’s European sites (Nijmegen, Hamburg) specialise in this stage, producing wafers backed with decades of design experience. And protected by IP.

Wafers are then shipped to the factories in Malaysia and the Philippines for further testing and packaging. Mature node wafers are typically high yield because they are created with tried and tested technologies and therefore contain very few “bad” chips.

Packaging consists of die cutting the individual chips loose from the wafer, packaging them in some insulating material, and wiring the chips to the package. This technology is even more established.

It’s the wafer production itself that is crucial. In the case of Nexperia, wafer production, even if mature technology, is the result of a century of innovation and manufacturing experience, first by Philips, then by its descendants. And therefore protected by intellectual property laws.

Nexperia was one of those descendants. A Dutch company, entrusted with the IP of its ancestors. But it’s new Chinese ownership wanted the IP for itself.

The evidence points to China having wanted Nexperia’s IP all along.

A couple of things happened in the last years that might make you think.

Just after Wingtech had acquired Nexperia, it opened new backend packaging facilities in China. Nexperia China did basically the same as the ones in Malaysia and the Philippines, but more focused on the Asian market. Now, never in all of the long history of Philips did they ever do production in China. This was a first.

In March 2024, Nexperia was hit with a cyberattack where sensitive IP was stolen.

In September 2025 the government of the Netherlands imposed the measures against Nexperia.

On December 22 Nexperia China declared itself independent from its headquarters in the Netherlands, saying that they have enough wafers for the whole of 2026. According to Techzine the wafers are Chinese.

It makes me think that this was planned by the Chinese government all along. But why? Again, these are not cutting edge AI chips we’re talking about, but almost ubiquitous chips for less demanding jobs.

While these chips aren’t cutting-edge, like sub 2nm ones used for AI, they’re still critical.

Nexperia supplies nearly half the semiconductors used in European cars. A disruption can halt production lines. As seen in 2025 when China banned exports of Nexperia chips.

They’re used in power management, connectivity, controllers in servers, industrial machinery, and consumer electronics. Losing control over their production would cripple EU industries.

Nexperia’s European sites hold decades of R&D in power semiconductors and discrete components. Transferring this to China would erode Europe’s industrial sovereignty in a sector where it has historically led.

It’s probably already happened. The March 2024 cyberattack may have been a way to accelerate IP acquisition by China, reducing the need for gradual transfer through corporate channels.

Maybe the former CEO Zhang got impatient, wanting to press ahead instead of waiting for the natural course of things. Triggering the Dutch government to act.

He had already seriously disrupted production by diverting company cash flow away from Nijmegen and Hamburg.

The Goods Availability Act was invoked by the Netherlands as a last-ditch measure to prevent Zhang from closing the EU branches and moving the complete production process to China.

By controlling back-end operations (packaging/testing) and now wafer production, China could disrupt global supply chains at will.

But why doesn’t the industry acquire the chips from Nexperia directly through the packaging facilities in Malaysia and the Philippines?

By now, China fully controls Nexperia’s supply chain.

The Dutch government acquired control over Nexperia HQ. Decision making was done by EU people in C-suite roles. Why can’t they simply bypass the ousted Wingtech CEO?

The situation is more nuanced than it seems, though.

The Dutch government’s intervention gave it control over governance and decision-making at the Dutch HQ and European subsidiaries. Not the company as a whole.

Nexperia China is legally separate from the Dutch HQ but operationally intertwined.

While the Dutch government controls the HQ, Nexperia China’s operations are legally registered under Chinese law and physically located in China.

In theory, the European plants (Netherlands/Germany) could produce wafers, send them to Malaysia/Philippines for processing, and then ship finished chips back to Europe, bypassing China entirely. This would solve the availability issue, avoiding Chinese export bans. However, in practice, there are three major obstacles preventing this from happening smoothly, if at all.

Even after the Dutch government’s intervention, Wingtech still holds majority ownership of Nexperia. The Dutch government’s Goods Availability Act only gives it temporary control over governance and asset transfers, not full ownership. Wingtech can block or delay decisions.

Philips’ legacy IP, such as wafer recipes, process technology, is licensed to Nexperia’s global operations. Not just its European operations. Wingtech could argue that the IP is now shared or co-owned, creating legal disputes.

Malaysia and the Philippines are not neutral actors in this dispute. Both countries have deep economic ties to China. Their largest trading partner, Chinese companies (including Wingtech) have invested heavily in Southeast Asian semiconductor facilities.

Redirecting wafer shipments from Europe to Malaysia/Philippines (instead of China) and back would require clearing substantial legal hurdles. It would require renegotiating contracts with Malaysian/Philippine plants, which might have contracts with Nexperia China, or ensuring Malaysian/Philippine plants still meet European quality standards.

And then there are the additional costs of logistics. If Nexperia China can produce wafers domestically, it can undercut prices from Malaysia/Philippines, in an already, not to forget, quite crowded market.

For customers such as the auto industry, the biggest costs of a switch is the requalification of the thousands of chips that go into a modern automobile. Especially if they’re more expensive, they’ll will be very hesitant to move away from cheap, already qualified chips from Nexperia China.

By acquiring Nexperia in 2018, China has the EU checkmate. So why didn’t we see this coming?

Of course, the world looked quite different then. Yes, it was Trump 1, but we all thought it would get back to normal soon. The depression of 2008 was ten years ago, and the Dutch had not yet made that horrific pivot to the far right. The liberal government of the time under prime minister Rutte was still thoroughly invested in global trade and the position of China as manufacturing hub for the west.

In 2018, Nexperia had not at all been up for sale for the highest bidder. In fact, the decision to sell came from the first generation child of Philips, NXP Semiconductors, in order to raise capital for its more high-value ambitions. What became Nexperia was the profitable Standard Products division of NXP Semiconductors.

NXP sold the Standard Products division to a consortium led by Chinese state-backed investment fund JAC Capital, and Chinese investor Wise Road Capital, for about €2.5 billion.

For China, this was a highly profitable deal in the context of their “Made in China 2025” 5 year plan. From mature node chip production, to Philips’ legacy IP in power management and discrete semiconductors, built over a century, to the global manufacturing facilities in Europe and Southeast Asia, which could be reconfigured to serve Chinese interests over time.

Nexperia’s European operations provided credibility and market access in the EU, a key region for automotive and industrial customers.

But there’s a little more to it. NXP Sold to Chinese Investors because of the lacklustre enthusiasm from the west. In 2016–2017, few Western semiconductor companies were interested in acquiring a mature node semiconductor business. The focus was on advanced nodes: 7nm, 5nm, and beyond.

Chinese investors were among the few willing to pay a premium for a business that was profitable but not cutting-edge.

No major red flags were raised by EU or Dutch authorities at the time. The EU’s Foreign Direct Investment screening was not yet fully implemented, and semiconductors were not yet viewed as a national security priority.

And so the acquisition was approved. At the time, focus was on financial returns and market access, not supply chain security or IP protection.

China is asserting its dominance over supply like never before.

It seems that lessons have been learned from the covid shutdown, where China saw that the dramatic slowdown of global transport, then a necessity for containing the pandemic, also held within it a power to control supply-side economics.

In October 2025, China banned exports of Nexperia chips in retaliation for the Dutch government’s takeover of Nexperia.

At the time of the ban, a small scale developer of custom built automobiles was featured on the daily news. I’m a car freak but I’d never heard of the brand.

The car was totally hand-built by a tiny crew, but, as all modern vehicles, needed chips to function. The news item showed a workplace full of cars which looked totally ready for the road but couldn’t be sold because of the missing crucial components from Nexperia.

The CEO explained that they were on the verge of bankruptcy because they couldn’t deliver. Switching to other chips would require redoing the car’s roadworthiness certifications by the government, leading to immense delays, and again, likely bankruptcy.

Halts in supply of critical mature node chips can cause breakdowns of server production in the EU. The chips banned by China included power management ICs, diodes, and transistors, which are crucial for server power supplies, cooling systems, and connectivity.

EU-based companies producing racks, power supplies, or cooling systems faced shortages of critical components. Without Nexperia’s chips, they couldn’t complete production lines.

Dell and HPE reported delays in server deliveries to EU customers due to shortages of power management chips and connectivity ICs. EU companies OVHcloud (France) and Hetzner (Germany) faced longer lead times for server hardware, forcing them to delay data center expansions or increase prices for customers due to component shortages. Both are leading the effort for the EU to become more independent of the US. But are now impacted by the looming trade war with China.

As a small software company we’re selling hosting as part of our maintenance subscription package. What if we can’t supply our customers with servers on which to run their applications? Hasn’t happened yet, but it looks like we were just lucky.

What’s happening now, in the aftermath of Nexperia’s splitup?

China lifted its export ban on some Nexperia chips in late 2025, but supply remains unstable. Server manufacturers are stockpiling components and exploring alternative suppliers, but switching is slow and costly.

The cost of power management chips and discrete semiconductors has risen by 15–20% for EU buyers, as suppliers pass on the risks of geopolitical disruptions

Operators in Amsterdam (Equinix, Interxion) have delayed expansions due to uncertainty over chip supplies for server hardware.

Manufacturers like Beckhoff Automation (factory automation) are facing lead times of 6+ months for mature node chips, forcing them to design around shortages by using older, less efficient components.

The custom carmaker’s potential bankruptcy and EU server delays show that no business is too small to be affected.

No business is so local so as to be unaffected by global breakdowns. Your local grocer? How about if their POS needs to be replaced? Let alone the management of their suppliers.

If you have the feeling that the world is growing more volatile every day, I think you’re right. Myself, I dare not watch the news.

Just a few years ago, most of us here in the west were enjoying the fruits of global trade. That it wasn’t as nice for those toiling in sweatshops was apparently considered acceptable, and I guess that goes for me, my family and my company. For which I should be ashamed.

But now a completely new situation is appearing, where the sweatshops of the world now belong to one of the three emerging power structures. Each fighting for dominion over the other two.

That the Act that forced Wingtech to divest its power over Nexperia dated from the age of the Cold War is no less than symbolic. But it least that war stayed cold. Because actually, the current power struggle, combined with an increasingly erratic and desperate would-be despot in the White House, and a China now a full-on world power, reminds more of the dramatic decades before the second world war.

Talk about how the global affects the local.

But maybe it’s just my over-active imagination. Because those times didn’t have the history behind them of how global trade changed ordinary people’s lives in a positive way.

They say history repeats itself. Just not in the way you think.

Header picture: The Sino-Dutch conflicts were a series of conflicts between the Ming dynasty of China and the Dutch East India Company over trade and land throughout the 1600’s. The Dutch were attempting to compel China to accede to their trade demands, but the Chinese defeated the Dutch forces.