Have the chip export controls worked? The honest answer is partly
Advanced nodes are genuinely constrained and China remains years behind at the frontier. Mature nodes are barely affected, and DUV lithography kept arriving legally in volume. The controls shaped the trajectory more than they stopped it.
Export controls on high-performance semiconductors, imposed by the United States with Japanese and Dutch alignment, have now run long enough to assess. The result is neither the containment their advocates hoped for nor the failure their critics claim, and the distinction between what worked and what did not is the useful part.
What the controls have actually constrained
At the frontier, they bind. Restrictions on EUV lithography and on equipment for 3nm–5nm production have held. China's most advanced domestic production sits at 7nm through SMIC, achieved with multi-patterning techniques on older equipment, and yield and scale remain the limiting factors rather than design capability. On the leading edge, the gap is measured in many years.
Materials controls have cut both ways. Chinese export restrictions on gallium and germanium — themselves a response — have pushed domestic semiconductor materials self-sufficiency above 30%, which was not the intended effect from Washington's side.
What they have not constrained
Mature nodes are largely untouched. Production at 28nm and above was never the target, and it is where most of the world's chips are actually used. China aimed for 70% self-sufficiency at mature nodes by 2025.
DUV lithography arrived legally, in volume. ASML's deep ultraviolet systems — the tools that make 7nm–14nm production possible — were not subject to the same restrictions as EUV for most of this period. China imported 27 ASML DUV systems in Q2 2023 alone, with cumulative installations exceeding 1,400 units by 2024. ASML's Chinese sales reached €2.79 billion in Q3 2024, around 47% of its global revenue.
That figure deserves to sit on its own. Roughly half the revenue of Europe's most strategically important technology company came from the country the controls were designed to constrain, through entirely lawful sales of equipment outside the restricted category.
Third-country routing. China imported $385 billion of integrated circuits in 2024, with Taiwan at $139.6 billion and Malaysia at $11.8 billion. Some proportion involves US-origin designs fabricated elsewhere and re-exported under a different origin. Packaging and test operations in Malaysia and Vietnam provide intermediate products.
Legal reclassification. China redefined integrated circuit origin in April 2024 so that chips fabricated in China count as domestic even where foreign intellectual property is involved — which changes subsidy eligibility and complicates the application of origin-based restrictions.
Compliance-designed products. NVIDIA and Intel produced China-specific variants — the H800 among them — engineered to sit below regulatory thresholds while preserving market access. The rules created a product category rather than closing a market.
And there is genuine evasion
Enforcement actions establish that some flow is straightforwardly illegal. Hong Kong customs intercepted 596 high-end Intel CPUs worth $1.5 million in June 2024, among other seizures. US officials have investigated whether restricted NVIDIA chips reached Chinese AI developers through Singaporean intermediaries — reported as investigations rather than established findings, and they should be read that way.
The methods are not worth cataloguing here. What matters analytically is the scale question: smuggled volumes are small relative to $385 billion of legal imports and 1,400 legally installed lithography systems. Evasion is the headline; legal supply is the substance.
That distinction matters for policy. A control regime failing at its edges is a different problem from one whose central categories were drawn too narrowly.
What China built in the meantime
Huawei's Ascend 910B, at performance approaching an A100, has been deployed across more than 30 intelligent computing centres with a domestic market share above 60%. SMIC has moved to volume at 14nm with 7nm risk production. Domestic GPU makers are shipping in increasing quantities. Around $150 billion has gone into semiconductor R&D.
Chinese law has also been mobilised: the Anti-Foreign Sanctions Law and blocking provisions prohibit firms from complying with foreign measures deemed unreasonable, and penalise those that do. A company operating in both jurisdictions faces genuinely irreconcilable obligations.
And access is being pursued through partnership — collaboration with Middle Eastern entities including Saudi AI ventures creates indirect routes to US technology that are, again, structurally legal.
The honest assessment
Controls have delayed China's frontier capability substantially and imposed real cost. They have not prevented competitive AI model development, because algorithmic efficiency partly substitutes for compute. They have not slowed mature-node expansion at all. And they accelerated exactly the domestic substitution programme they were meant to forestall — while making it a funded national priority with published targets.
The dependency that remains is real: Ascend production still relies on imported equipment and foreign intellectual property, and third-country routing is fragile to enforcement pressure. But the direction of travel is toward reducing that dependency, and the controls are the reason it is being pursued with urgency.
What this means if you are on the European side
European equipment makers are inside this, not observing it. Half of ASML's revenue in a quarter came from China. Any tightening of DUV restrictions is a European industrial policy decision with European revenue consequences, not an American one to be complied with. That trade-off deserves to be made explicitly.
Conflicting legal obligations are now a live compliance problem. Chinese blocking provisions prohibit compliance with foreign restrictions the same measures require. European firms with operations in both jurisdictions cannot satisfy both, and need a position worked out in advance rather than during an enforcement action.
Mature nodes were never controlled, and that is where European dependency sits. The public debate concerns advanced nodes. European automotive and industrial exposure is at 28nm and above — the segment that expanded throughout, unaffected.
Third-country routing makes origin diligence necessary rather than optional. Where a meaningful share of chips reaching China moves through Taiwan, Malaysia and Singapore, European firms buying from those markets need to understand what they are actually buying and from whom.