Dutch government in panic mode over keeping ASML in the country

https://www.theregister.com/2024/03/06/dutch_asml_visas/

by neverrroot • 2 years ago

39 36 2 years ago

diggan2• 2 years ago

The company now has to apply for Dutch export licenses for its most advanced DUV and EUV gear, plus US government licenses for some systems destined for China. The latter market accounted for over a quarter of its net sales last year. ®

ASML is still Dutch, as far as I understand, but I guess they already have offices in the US or something? Why would a US government license be required for a Dutch company to sell to Chinese customers?

atemerev2• 2 years ago

Because it uses some American tech or patents, and there is leverage and pressure point over these.

wil421• 2 years ago

Lots of people have said it before. ASML bought Silicon Valley Group after ASML was not granted an EUV license for whatever reason along with a couple of familiar Japanese companies. EUV LLC is owned by the DOE/US government and others in a private/public consortium.

In the 2000s ASML bought Silicon Valley Group (SVG) to develop EUV lithography. Now ASML has to abide by the EUV LLC license terms which include US congressional oversight.

It’s the US governments tech commercialized by a Dutch multinational company who also has to abide by Dutch export and government restrictions.

diggan2• 2 years ago

Thanks a lot for the elaborate explanation that went into specific details of why things are like they are.

DiogenesKynikos3• 2 years ago

The US makes heavy use of secondary sanctions to coerce foreign companies and governments into restricting business with America's "enemies."

The US has leverage to do this, because much of the world's financial transactions run through the US financial system, and much of the world's financial industry has significant exposure to the US. If ASML shrugs off the US government's demands, it will quickly find itself shut off from every major bank, and every supplier who wants to avoid the same fate will cut off its business with ASML.

In the specific case of ASML, however, the US also has a Cold-War-era agreement with the Netherlands on transfer of technology to other countries.[0-1]

0. https://en.wikipedia.org/wiki/Wassenaar_Arrangement

1. https://www.reuters.com/technology/amid-us-pressure-dutch-an...

atemerev2• 2 years ago

It is really counterproductive policy to keep highly qualified immigrant workers from coming into the country. And sadly common everywhere.

eythian• 2 years ago

In this case (like, as you say, common) the current centre-right caretaker government, and even moreso the elected-but-not-yet-coalesed incoming government are pandering to populist ideas which includes "immigration bad", reducing (the already reduced) tax breaks on people who move as knowledge workers, threatening to cap numbers, etc. It speaks well to a lot of voters, especially when lined up with "but there's not enough housing anyway", but it will, imo, cause damage to economic growth.

ouroborosidiots• 2 years ago

Isn't "right leaning" supposed to mean "lower taxes" in most places?

DiogenesKynikos3• 2 years ago

This reminds me of the arguments over visas for tech workers in the US. A common argument I hear is that immigration is robbing Americans of high-tech jobs in Silicon Valley.

I think the mistake in those arguments is that there's no intrinsic reason why the world's tech sector has to be so concentrated in Silicon Valley. The major reason why the industry continues to be so concentrated in Silicon Valley is because that is where the workforce is. If the flow of skilled workers to Silicon Valley - from all over the world - is choked off, the industry will move to where the high-skill workforce is.

The Dutch seem to be testing out this theory in real life. I would guess that ASML is heavily dependent on highly educated people who come from all over the world, and that restricting its workforce to Dutch (or even EU) citizens would severely damage the company.

jevoten• 2 years ago

People are perhaps not so enthusiastic about giving away their countries just so multinational companies with no loyalty to them don't leave. On the other hand, China, Japan, Taiwan, and South Korea all manage to have highly-successful tech industries (tech, not ads and social media) with near-zero immigration.

nequo• 2 years ago

China, Japan, Taiwan, and South Korea all manage to have highly-successful tech industries

At salaries and with work hours that are far from enviable.

DiogenesKynikos3• 2 years ago

Those countries have much stronger educational systems (at least K-12) and a much stronger devotion to education than the US.

On the other hand, the US benefits massively from its research universities, which attract large numbers of top-quality graduate students from around the world, many of whom remain in the US after their studies and make up much of the tech workforce.

giving away their countries

How does immigration of highly skilled tech workers in any way "give away the country"?

9dev• 2 years ago

It is sad how right-wing populists in Europe seem to take over overwhere. This is just one example of the mayhem they cause with short-sighted, fear-driven policy making -- I dread the upcoming votes in Germany, when the AfD (a far-right, but very successful party) is going to expand their power considerably.

bryanlarsen2• 2 years ago

Yet people generally believe that right wing parties are good for business, despite massive piles of evidence to the contrary.

snehk• 2 years ago

Germany's current government is anything but right wing and it's the only large economy on this planet that's literally shrinking.

huijzer• 2 years ago

But it appears that being able to hire the right personnel is not the only concern. Problems with electricity grid congestion affecting industrial power supplies and attempts to limit nitrogen emissions are also said to be issues raised by the company.

Must play a role too, yes. It was reported a few weeks ago that a primary school in Veldhoven (the relatively small town where ASML’s headquarters is) will not get access to the power grid. They will place a diesel generator next to the school for the next few years [1].

[1] https://nos.nl/video/2510756-een-splinternieuw-schoolgebouw-...

rvschuilenburg3• 2 years ago

Some of these are to curb immigration, including moves to end tax breaks for highly skilled foreign employees that are being implemented by the current administration.

I haven't read more about this besides this article, but why should highly skilled foreign employees receive tax breaks?

0xfaded• 2 years ago

Denmark does this, but only for a limited period (7 years I think). Part of it is competitiveness to make competing for top talent on par with lower tax countries. The other part is the temporary nature since higher earners are more likely to return to their home countries.

rvschuilenburg3• 2 years ago

I have mixed feelings about this. The Netherlands is an expensive country to live in, and this is paid for using taxes. If you decide to live and work in The Netherlands, i would expect you to pay the same amount of taxes as others.

Then again, i can understand the argument that indirectly the company is paying tons of taxes because it is a big company. Losing that company + its employees might be a bigger negative in tax income than having those employees pay less taxes.

blastonico• 2 years ago

Because these people have offers to work anywhere - and they usually help training the locals, improving the regional labor skillset. Tax break is one way to attract them.

I'm not that skilled, but I've already turned down some opportunities in Europe due to the taxes. I don't wanna work to give almost 50% to King Charles, I prefer living in a beautiful condo in Panama and cash everything.

But this is my point of view only.

rvschuilenburg3• 2 years ago

I don't wanna work to give almost 50% to King Charles, I prefer living in a beautiful condo in Panama and cash everything.

I think that's fair. I wouldn't fault you for that. My counter argument would be that this 50% of your income won't go to Charles, but it will go to all of the social services we have in our country. Those aren't cheap. If you don't want that, sure. But i think it would be wrong if we would then let you live + work here and give you a tax break.

fjfaase3• 2 years ago

Immigrants get a 30% tax break, meaning that they only have to pay income taxes over 70% of their income. For the average income of people working at ASML, I guess that they have to pay about 30% taxes. It basically means that ASML can pay less to immigrants workers compared to native workers to give them the same salary.

In the Netherlands we are currently having a housing crisis, which is partly caused by labor immigration. This has caused many people, especially those from gen Z, being unable to buy a house. In and around Veldhoven, where ASML has its main offices, house prices have gone up. ASML is investing some money in housing projects.

For these reasons, some political parties feel that the tax break should be removed. Which would mean that ASML would have to pay their employees more and due to this they will make less profits.

ASML is depending on many companies in and around Veldhoven/Eindhoven and even on some further away for parts of their machines. For that reason, I think it would not be that easy for them to relocate to a different country. They would have to build up contact with local parts produces. If the move to a different country, it maybe also would mean that a part of their employees is not willing to relocate.

tmaly• 2 years ago

I see an ASML lithography division here in Connecticut that I drive by from time to time. I believe they also have a division in California.

fjfaase3• 2 years ago

I get the impression that the development of their waver steppers is still in Veldhoven. It is there were they are assembled and where improvements are tested. It is easy to move production departments, than research and development. It might be the case that part of the research and development is done in close cooperation with some of the suppliers. Their waver steppers have (probably) millions of parts that all have to work together.

bgnn3• 2 years ago

Oh that would be quite easy for them since all these companies can ship the parts wherever ASML wants. They rely a lot of companies in Germany and Belgium, Korea, Taiwan, Japan, USA too.

fjfaase3• 2 years ago

On one hand that is true, but I think for some of the critical parts, I guess they do have a rather close relationship with, and having regular meetings with. Having regular meetings with a company that is at two hour drive is a bit easier than at a different continent. And then there are also culture changes that require you to build a relationship with your suppliers.

bgnn3• 2 years ago

ASML doesn't belong to NL. This isn't a country for productive economy. Dutch hate anything other than finance and farming. It's much better if they move to Germany, or better yet to France with nuclear energy!

the_third_wave• 2 years ago

The Dutch quite liked Philips Electronics when that was still a thing. Also, DAF Trucks, Océ printers/copiers and some others. The slogan Koopt Nederlandsche waar, dan helpen wij elkaar (Buy Dutch products so we help each other) used to be a thing and still rings true in (an aging) part of the population.

Dutch government in panic mode over keeping ASML in the country

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