Japan has lodged a protest against China’s recent move to impose stringent new export restrictions on dichlorosilane (DCS), a critical chemical in semiconductor production. The Japanese government is currently evaluating the potential implications of these measures on its companies, including major exporters like Shin-Etsu Chemical and Denal Silane. The new rules mandate that Chinese importers of DCS from Japan provide cash deposits that could reach as high as 99.2%, posing a significant financial burden.
China has justified these provisional restrictions by citing an anti-dumping investigation, which concluded that Japanese DCS exports negatively impacted China’s domestic industry. The final outcome of this investigation will determine whether the restrictions remain in place. Meanwhile, Japan is urging China to avoid unfairly harming Japanese businesses and has indicated that it will consider appropriate responses if the situation does not improve.
This development occurs amidst a backdrop of increasing tension between China and Japan, particularly related to Japan’s stance on Taiwan. The strained relations have already seen Beijing implementing various trade and export limitations that affect Japanese companies, especially those involved with dual-use products that could have military applications.
DCS plays a pivotal role in the manufacturing of semiconductors, as it is used to create ultra-thin layers of silicon and other materials on computer chips. Given Japan’s status as a leading producer of ultrapure DCS, these new restrictions could have substantial repercussions on the global semiconductor supply chain, which is already under significant pressure.
