European technology companies complain that US sanctions against Huawei and SMIC have caused the Chinese technology market to close in front of them while US tech companies can get exceptions.
European technology executives and diplomats accuse the United States of using its sanctions regime to keep them out of the Chinese market while offering waivers to US companies.
This is an unintelligible side effect of the sanctions, which was certainly not a coincidence given the trade policy of the outgoing presidential administration of putting America first.
Several European companies that produce chips and chip-making equipment are affected by US sanctions because they rely on American intellectual property.
An EU technology executive said For a newspaper Financial Times: So far, American companies have been granted licenses to supply Huawei, while European companies cannot do so.
Another source told the newspaper that European technology companies are no longer able to supply components to Chinese companies due to suspicions that they are being used for military purposes. But American companies were allowed to supply the same components to the Chinese companies themselves.
Reinhard Ploss, CEO of Germany-based Infineon, said: For a network CNBC: Europe should be careful not to be crushed in the competition for technological leadership between the United States and theChina.
He added: The geopolitical tension between the two superpowers is a source of great concern because we believe that we should not focus on countries, and that we should focus on the needs of our global community.
ASML, a Netherlands-based company, has been banned from selling its latest-generation devices to China-based chip maker SMIC, which typically accounts for 25 percent of its revenue.
Despite the complaints, some non-US companies have received exemptions regarding sanctions against Chinese companies, including South Korea’s Samsung and Japan’s Sony.
But the US-centered nature of the sanctions could have far-reaching consequences, and as in China, European governments now want to be less dependent on American technology.
A European diplomat told the Financial Times: This process has accelerated due to US sanctions, and China is for European companies such a large market that they need to find ways to serve them.