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Netherlands plans new curbs on chip-making equipment sales to China -Bloomberg News

FILE PHOTO: ASML Holding logo is seen at company's headquarters in Eindhoven

(Reuters) -The Netherlands plans new controls on exports of chip-making equipment to China and a deal could be announced next month, Bloomberg News reported on Thursday, citing people familiar with the matter.

Dutch firm ASML Holdings NV is a world leader in semiconductor production equipment and had sales to customers in China of more than 2 billion euros ($2.1 billion) last year.

However since 2018 the Dutch government has not granted ASML licences to export its most advanced machines to China as they are considered "dual use" with potential military applications.

Dutch Trade Minister Liesje Schreinemacher last month said the Netherlands was in talks with the U.S. government about new export restrictions on semiconductor equipment sales to China.

According to Bloomberg, an agreement could come as soon as next month, adding that it was unclear what the new restrictions would mean for ASML's sales to China.

The Dutch Ministry of Foreign Affairs, the White House's National Security Council and ASML declined to comment.

ASML shares were down 0.2% lower at 563.00 euros at 0942 GMT.

"This news will not come as a complete surprise to the market," Citi analyst Amit Harchandani said, noting that ASML in October had indicated that up to about 5% of its total backlog was at indirect risk from the broader U.S. restrictions.

The company's prospects outside China remain strong, he added.

China is the Netherlands' third-largest trade partner after Germany and Belgium, according to the Dutch statistics office.

The Biden administration in early October published a sweeping set of export controls, including a measure to cut China off from certain semiconductor chips made anywhere in the world with U.S. tools.

($1 = 0.9517 euros)

(Reporting by Kanjyik Ghosh in Bengaluru; editing by Crispian Balmer and Jason Neely)