Overview

• An official House report says Chinese firms bought about $38 billion of semiconductor manufacturing equipment in 2024 from Applied Materials, Lam Research, KLA, ASML and Tokyo Electron, totaling roughly 39% of their combined sales.
• The investigation cites gaps between U.S., Dutch and Japanese rules that let non‑U.S. vendors sell gear to Chinese buyers that American firms could not, especially non‑EUV and other non‑listed tools.
• The panel recommends shifting from entity‑based measures to comprehensive, country‑wide restrictions, broader licensing, and potential expansion of the Foreign Direct Product Rule to reach allied-made equipment tied to U.S. technology.
• The report names SwaySure Technology, Shenzhen Pengxinxu Technology and SiEn (Qingdao) as security concerns, noting U.S. officials barred exports to those firms in December; it does not allege any toolmaker broke the law.
• Industry voices report China sales have begun to decline in 2025 as new rules take hold, while shares of major toolmakers fell on concerns about tougher controls and tighter enforcement.