Beijing has said it will loosen a chip export ban it imposed after Dutch authorities took over Nexperia - a Chinese-owned chipmaker based in the Netherlands.
In September, the Netherlands used a Cold War era law to take over the company after citing serious governance shortcomings and to prevent the chips from becoming unavailable in an emergency.
In response, China said it would not re-export completed Nexperia chips to Europe which raised concern among carmakers. One association had described the move as alarming.
Around 70% of chips made in the Netherlands are sent to China to be completed and re-exported to other countries.
In a statement on Saturday, China stated that it would comprehensively consider the actual situation of enterprises and grant exemptions to exports that meet the criteria. However, it has not specified what that could entail.
China also criticized the Hague for what it termed improper interference in the internal affairs of enterprises and blamed it for the current disruption of global production and supply chains.
The Dutch-controlled firm indicated that it would stop sending chips back to China for processing, according to a letter this week seen by the Reuters news agency.
Last month, the European Automobile Manufacturers' Association (ACEA) warned that Nexperia chip supplies would only last a few weeks unless the Chinese ban was lifted.
Without these chips, European automotive suppliers cannot build the parts and components needed to supply vehicle manufacturers, which therefore threatens production stoppages, the group stated.
The plans by Beijing to relax its export controls came after Donald Trump and Xi Jinping met in South Korea earlier this week.
Trump later said the leaders discussed chips, while Beijing's post-meeting readout did not mention any specific area of trade.
The White House is expected to release a fact sheet later today detailing its new trade agreement with China. According to reports, it will also announce the resumption of Nexperia exports.
In December 2024, the US government placed Wingtech on its so-called entity list, identifying the company as a national security concern.
In the UK, Nexperia was forced to sell its silicon chip plant in Newport after MPs and ministers expressed national security concerns. It currently operates a facility in Stockport.
