The Enterprise Chamber of the Amsterdam Court of Appeal on Wednesday ordered a formal investigation into Nexperia, a Netherlands-based semiconductor company, and kept in place an earlier order suspending the firm’s Chinese chief executive, according to the court’s written decision. The court’s step follows a broader corporate dispute that last year prompted the Dutch government to take what it described as extraordinary action tied to concerns about technological capabilities.
The court’s English statement said it found what it described as a conflict of interest “handled without due care” at Nexperia. The judges also pointed to “indications that the director of Nexperia changed the strategy without internal consultation under the threat of upcoming sanctions,” and described changes that included Dutch government agreements not being followed.
In that statement, the court said agreements with the Dutch Ministry of Economic Affairs “were no longer adhered to,” and it said the powers of European managers were restricted and their dismissal was announced. The court said it could not definitively say how long the investigation would take, adding that such probes can last more than six months.
The order is the latest development in a dispute that made global headlines after the Dutch government said it effectively took control of Nexperia last year. Dutch officials said they acted out of fear that corporate governance concerns linked to the company’s Chinese ownership could lead to a loss of technological capabilities considered important to Dutch and European economic security.
As the dispute unfolded, automakers moved to secure alternative chip sources after boardroom turmoil disrupted shipments of the standardized components Nexperia makes. The chips are used in functions described by the company’s critics as essential for controlling vehicles, including systems tied to operating headlights, airbag deployment and anti-lock brakes.
Nexperia’s CEO, Zhang Xuezheng—who is also described as the founder of Nexperia’s Chinese parent Wingtech—was suspended by the Enterprise Chamber in October after claims of mismanagement. At a hearing last month, lawyers for Zhang and Wingtech urged the court not to order an investigation, and they argued that Wingtech was blindsided by the Dutch government’s move; Zhang was not present in court.
A lawyer for Nexperia, Jeroen van der Schriek, told the panel that conduct by Wingtech and a Hong Kong-based holding company called Yuching since October showed, in his view, that they were “willing to subordinate Nexperia’s interests to other interests.” The court’s decision Wednesday said its finding supported moving toward a formal probe that would be used to determine whether there had been mismanagement at Nexperia and whether definitive measures were needed.
In response to Wednesday’s ruling, Nexperia said in a statement posted online that it “welcomes and respects” the decision and is “committed to fully complying” with the investigation. Wingtech said it was confident that “a full, fair and impartial inquiry” would show that its actions were “appropriate and in the best interests of the company and its stakeholders,” while also arguing that keeping Zhang suspended would prolong what it called “significant uncertainty.”
The dispute has also played out against a backdrop of broader trade and technology tensions between the United States and China. The article said U.S. officials told the Dutch government that Zhang should be replaced to avoid trade restrictions, citing a court filing from last year, and it said Beijing responded to the earlier Dutch seizure by blocking export of Nexperia chips from its Chinese assembly plant before later lifting the ban after Donald Trump and Xi Jinping met in late October.
The dispute further highlighted how governments have sometimes stepped in to secure strategic industries during major geopolitical disruptions. The Dutch court’s decision arrived as the broader Nexperia saga continued, with the company described as spun out from Philips Semiconductors two decades ago and bought in 2018 by Wingtech.
In its written decision, the court also offered context on prior government actions in Europe after other geopolitical crises. It said Germany took control of subsidiaries of Rosneft after the Russia-Ukraine war began, and that Germany and Poland also took over gas companies linked to Gazprom during an energy crisis.
This version of the story corrects the year of a British government block involving Nexperia’s bid to acquire Wales-based chipmaker Newport Wafer to 2022 from 2023.