Japan has expressed strong objections to China’s recent decision to enforce stringent new export controls on dichlorosilane (DCS), a critical chemical in semiconductor production. This move by China mandates that Chinese importers of DCS from Japan make cash deposits as high as 99.2%, a requirement that significantly affects Japanese exporters such as Shin-Etsu Chemical and Denal Silane. The Japanese government is currently evaluating the potential repercussions on its domestic companies.
According to China, these measures are temporary and stem from an anti-dumping investigation that concluded Japanese DCS exports adversely impacted China’s local industry. A conclusive decision is anticipated once the investigation concludes. Japan has urged China to ensure that these restrictions do not unfairly target Japanese businesses and has indicated that it may take necessary steps if those businesses are adversely affected.
The imposition of these restrictions occurs against a backdrop of deteriorating relations between China and Japan, particularly concerning Japan’s stance on Taiwan. In addition to the DCS restrictions, China has also enacted other trade and export limitations involving Japanese companies, including those dealing with dual-use products that could have military applications.
DCS plays a vital role in the semiconductor industry, being used to form ultra-thin silicon and other material layers on computer chips. Given Japan’s status as a leading global supplier of ultrapure DCS, these newly imposed restrictions hold substantial implications for the global semiconductor supply chain.