Dutch court says Nexperia's Chinese CEO was suspended over "reckless leadership"
A Dutch court has suspended Zhang Xuezheng, CEO of semiconductor company Nexperia, citing reckless leadership and poor preparation for imminent U.S. trade restrictions, according to a ruling published Tuesday by the Amsterdam Court of Appeal.
The court found that Zhang failed to act after Nexperia anticipated for months that it would be added to the U.S. Entity List, which would impose severe trade restrictions due to the company’s Chinese ownership. On September 30, it became clear that the restrictions would take effect at the end of November.
Instead of preparing the company, Zhang allegedly acted in the opposite direction. On September 25, three senior financial executives at Nexperia’s Dutch office were removed without explanation. Employees without financial experience were allowed to manage banking operations, a move the court called “reckless.”
The court also raised concerns over Nexperia’s purchase of wafers—thin disks used in electronics—produced by its Chinese sister company. Zhang, also known as Wing, oversaw transactions where the company bought 200 million dollars' worth of wafers, far exceeding the roughly 75 million dollars actually needed, with some of the excess reportedly destroyed. The court cited this as a conflict of interest, noting that the wafer producer, WSS, was financially troubled.
Three European Nexperia executives sought help from the Dutch Ministry of Economic Affairs when it became clear the company would face U.S. sanctions. The ministry subsequently imposed restrictions on Nexperia. On October 7, the Enterprise Chamber ruled that Zhang would be temporarily replaced by a non-Chinese executive, and the shares were transferred to an independent party.
China responded angrily, imposing an export ban on Nexperia’s Chinese operations, affecting the company’s European customers. The Chinese Ministry of Foreign Affairs criticized the Dutch government’s intervention as improper, while the Dutch Ministry of Economic Affairs cited concerns over national economic security.
