US Congressmen criticize Tokyo Electron, ASML, KLA, and others for supporting China's semiconductor industry
The U.S. government has imposed restrictions on exports of high-performance semiconductors to China, and major manufacturers like NVIDIA and AMD have been
New Investigation Reveals American and Allied Companies Boosted the CCP's Semiconductor Industry, Fueled the PRC's Military Ambitions and Human Rights Abuses | Select Committee on the CCP
https://selectcommitteeontheccp.house.gov/media/press-releases/new-investigation-reveals-american-and-allied-companies-boosted-the-ccp-s-semiconductor-industry-fueled-the-prc-s-military-ambitions-and-human-rights-abuses
(PDF file)THE SELECT COMMITTEE ON THE STRATEGIC COMPETITION BETWEEN THE UNITED STATES AND THE CHINESE COMMUNIST PARTY | SELLING THE FORGES OF THE FUTURE
https://selectcommitteeontheccp.house.gov/sites/evo-subsites/selectcommitteeontheccp.house.gov/files/evo-media-document/selling-the-forges-of-the-future.pdf
US lawmakers call for broader bans on chipmaking tool sales to China | Reuters
https://www.reuters.com/world/china/chinas-chipmakers-bought-38-billion-us-allied-tools-sign-policy-is-failing-2025-10-07/
John Moolenaar, Chairman of the House Select Committee on Security and Security Policy, strongly criticized the companies, saying, 'The Committee has found that the companies under investigation are large-scale manufacturers of equipment used by China to further its military ambitions. They are increasing their profits at the expense of America's national security. We must never allow this critical equipment to be handed over to our greatest adversary, China, or America may lose the technological arms race.'
The House Select Committee cited the following companies as 'selling equipment to Chinese state-owned enterprises and military-related companies.'
・ASML (Netherlands)
・Tokyo Electron (Japan)
・Applied Materials (USA)
・KLA (USA)
・Lam Research (USA)
According to an investigation by the House Select Committee, Tokyo Electron derives 44% of its revenue from China, followed by Lam Research at 42%, KLA at 41%, and ASML and Applied Materials at 36%.
'It makes little sense to violate human rights by selling to the Chinese Communist Party chips needed to modernize its military. And it makes even less sense to sell the equipment and tools the Chinese Communist Party needs to manufacture those chips itself,' said Raja Krishnamoorthi, ranking member of the House Select Committee on Security and Security. 'This investigation reveals that the scale of these sales by Dutch, Japanese, and American companies is much larger than we realized. Together with our allies, we must protect our national security and remain a world-leading innovator in small and medium-sized enterprises.'
Following the House Select Committee's investigation report, stock prices for ASML, Tokyo Electron, KLA, Applied Materials, and Lam Research all plummeted across the board. Mark Dougherty, president of Tokyo Electron's U.S. subsidiary, said in an interview with Reuters, 'At Tokyo Electron, our sales in China have begun to decline this year, partly due to the impact of the new regulations. However, from a U.S. perspective, I think it's clear that there are desirable outcomes that have yet to be achieved.' While acknowledging the strengthening of cooperation between the U.S. and Japan, he noted that it remains a long way from being fully realized. In response to Reuters' request for comment, ASML and KLA declined to comment, while Applied Materials and Lam Research had not responded to requests for comment at the time of writing.
The House Select Committee points out that this incident is due to 'regulatory inconsistencies.' Therefore, the House Select Committee is calling on allies such as the Netherlands and Japan to 'align with U.S. regulations and enforcement,' 'prohibit all allied manufacturers from selling to additional Chinese military organizations,' and 'restrict exports of components critical to the production of small and medium-sized enterprises.' Furthermore, the committee aims to ensure innovation and leadership in small and medium-sized enterprises in the United States and its allies by supporting U.S. small and medium-sized enterprises in developing world-class human resources.
While President Donald Trump claims that 'the United States is surpassing other countries in AI at levels no one could have imagined,' NVIDIA CEO Jensen Huang has expressed a contrasting view, saying, 'The United States is not far ahead of China in AI development.' According to Huang, China has rapidly advanced and far surpassed the United States, particularly in open-source AI models and consumer AI products. However, President Trump and Huang agree that 'the United States will lead AI development by encouraging countries around the world to build on American technology foundations and standards.'
The United States is also considering a bill called the Gain AI Access and Innovation Assurance Act (GAIN AI), which would require cutting-edge AI chips to be sold to American companies before being made available to certain countries, including China. NVIDIA and the Semiconductor Industry Association (SIA) have been lobbying strongly against the GAIN AI bill, with an NVIDIA spokesperson criticizing it, saying, 'This bill attempts to solve a 'non-existent problem,' and would limit global competition in every industry that uses mainstream computing chips.' The GAIN AI bill is stalled in the Senate at the time of writing and is expected to be considered between the end of 2025 and early 2026.
'It is long past time for semiconductor companies to start treating the Chinese Communist Party and major Chinese companies as existential threats, rather than as valued customers,' Moolenaar and Krishnamoorthi wrote in their report.
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