OPINION — China is conducting intelligence operations within the Netherlands which are concentrating on key industrial sectors together with semiconductors, aerospace and maritime know-how, Dutch Protection Minister Ruben Brekelmans just lately warned. Dutch nationwide safety and transatlantic provide chains are in peril due to state sponsored cyberattacks and clandestine intelligence operations. This exercise threatens not solely the Netherlands, but additionally the whole free world.
In response to comparable Chinese language concentrating on of semiconductor and tech industries in the USA, the U.S. Authorities has expressed solidarity with the Dutch and is strengthening cooperation on export management coordination, cyber protection, and counterespionage.
The latter is especially necessary as it’s the PRC intelligence providers (MPS and MSS) that siphon this data out of corporations within the Netherlands in addition to different international locations world wide which have tech industries. China does this to present themselves the benefit in financial and army competitors towards western and allied democracies (resembling Japan, South Korea and others). However in the case of safeguarding transatlantic innovation and safety, unity is the important thing with NATO, EU-U.S. and intra-allied export controls and industrial capability.
China’s strategic espionage marketing campaign within the Netherlands
China engages in a scientific, state-sponsored, long-term marketing campaign of industrial-espionage within the Netherlands. Dutch Protection Minister Brekelmans referred to cyber threats which are “intensifying” and singled out ASML, the main Dutch semiconductor firm, as Beijing’s principal goal.
Being the house of ASML, the Netherlands is in a singular and precarious place as a result of ASML, makes it an important nation to the manufacturing of semiconductors worldwide, an {industry} that’s more and more being seen as a nationwide safety asset. China’s intrusion into Dutch know-how corporations not solely jeopardizes home innovation but additionally places provide chains within the U.S. and Europe in danger.
In January 2023, information of a Chinese language cyberattack on Dutch protection networks served as a wake-up name for decisionmakers in Washington and The Hague. The U.S. Justice Division has pursued dozens of espionage instances coping with confidential industrial information being stolen from American corporations, and the similarities of those instances match that of the Dutch cyberattack in 2023.
China’s actions within the Netherlands aren’t remoted incidents however a part of a coordinated international marketing campaign to entry dual-use applied sciences. These efforts endanger transatlantic resilience and innovation in a number of key methods together with:
Erosion of Technological Sovereignty: Dutch semiconductor and aerospace experience is central to the EU’s ambition for strategic autonomy. Unauthorized transfers of mental property (IP) to China weaken Europe’s leverage in international provide chains and degrade long-term competitiveness and on the similar time, harm the EU’s financial system.
Threats to NATO Interoperability: Applied sciences compromised in Dutch companies may very well be re-engineered by China and utilized in ways in which degrade NATO readiness. Maritime methods and aerospace software program, typically built-in into joint EU–U.S. platforms, are in danger of being reverse-engineered for PLA army use.
The U.S. export restrictions on superior chip-making instruments to China – which embrace diplomatic stress on ASML – lose their effectiveness when unlawful know-how entry happens by espionage, such because the PRC sending tech college students to work in such industries for the aim of stealing crucial IP data.
Not all of them are spies or need to be spies, however the stress on them and their households from the PRC Authorities to report again and steal IP secrets and techniques is critical. Such a espionage threatens western and U.S.-led strategic containment plans for safeguarding crucial know-how.
China’s intelligence penetration within the Netherlands represents not solely a transatlantic safety subject that extends past bilateral relations but additionally is a risk to the whole western coalition (together with non-western allied companions that produce such chips, like Taiwan and its market-leading Taiwan Semiconductor Manufacturing Firm (TSMC).
The excellent news is that the Dutch authorities has began implementing enhanced export laws along with enhanced funding screening procedures and higher intelligence-sharing mechanisms. The federal government’s actions observe latest United States insurance policies on this space creating potential collaborative prospects. The Netherlands has restricted Chinese language entry to ASML’s superior Excessive Ultraviolet (EUV) lithography methods as a part of their export management system which matches U.S. coverage.
As well as, the Netherlands is devoting extra assets to this effort. For example, it’s strengthening its cyber protection by public-private partnerships whereas recognizing the problem to coordinate their response with the opposite European Union member-states and the U.S.
In relation to that, the U.S. Cybersecurity and Infrastructure Safety Company (CISA) has solicited curiosity to develop its transatlantic threat-sharing networks with Dutch and European companions alike. The Netherlands has just lately created its personal international funding screening system much like the one outlined within the U.S. Committee on Overseas Funding (CFIUS) course of. And on the EU stage, a extra targeted coverage harmonization would allow them to match U.S. requirements. The Dutch and U.S. governments have agreed to an unprecedented transfer to formally establish China because the origin of espionage threats.
Chinese language authorities strongly deny the allegations by the Dutch Protection Minister. The U.S. and Europe publicly accusing China signifies {that a} new interval of direct and significant opposition to PRC interference within the home innovation system of allied and pleasant democracies in Europe is rising.
Join The Cipher Transient’s Nightcap publication: one of the simplest ways to unwind day-after-day whereas nonetheless staying up to the mark on nationwide safety.Enroll at this time.
Coverage gaps and dangers
However The Netherlands together with different European international locations face ongoing safety challenges which allow China to take advantage of technological vulnerabilities.
For example, the Netherlands has discovered it essential to improve its regulatory framework, which is promising. Nonetheless, fragmented EU enforcement mechanisms allow China to achieve entry to restricted applied sciences. Up to now, China has directed acquisition operations towards member-states which have weak regulatory requirements.
For instance, Dutch SMEs face bigger challenges in comparison with larger corporations throughout the globe, as a result of they typically don’t have as many assets to restrict superior subtle cyber threats and that is one thing policymakers must be taking a look at.
In line with Dutch and U.S. intelligence assessments, the small and medium-sized enterprise sector stays probably the most weak to international exploitation.
The Netherlands and different western nations face financial retaliation threats from China that would end in decreased rare-earth exports and decreased entry to the Chinese language market which might hurt Dutch industries. The Netherlands along with its U.S. counterparts relies upon closely on China for crucial mineral imports.
The present approaches to diversification stay inadequate.
The Netherlands doesn’t keep formalized industry-government threat-exchange mechanisms like people who function between CISA and the FBI in the USA. The implementation of cyber and export safeguards depends upon voluntary {industry} participation which exhibits variability between analysis institutes and rising corporations.
Be a part of us in Sea Island, Georgia for The Cipher Transient’s 2025 Menace Convention from October 19-22. See how one can save your seat at tcbconference.com
Coverage concerns for a transatlantic response
Institution of a NATO tech safety coverage settlement signed by all its member states may contain a number of of the next:
- Growth of a curriculum for cyber threat coaching that may very well be utilized by each personal companies and intelligence providers and governments.
- Allow real-time risk sharing between ASML, the U.S., European and allied international locations’ companies whereas on the similar time exploring the chance for introducing cyber protection IP capabilities safety protocols. Any such agreements ought to cowl crucial private-sector organizations along with army operations.
- A joint licensing framework for an inventory of corporations that may have been verified for being freed from Chinese language affect, to hurry up the enactment of high-tech export controls between these member international locations by implementing standardized protocols for semiconductor instruments, AI chips and aerospace designs. The U.S. has taken the first steps in that route.
Improve Counterintelligence Consciousness in Business
The Dutch and U.S. governments ought to begin a joint marketing campaign targeted on elevating consciousness amongst small and medium enterprises in addition to analysis establishments and universities that mimics the authentic U.S. “China Initiative” (the newer model has been in legislative limbo, having handed Home approval however caught, for now, within the Senate Committees) by instructing them learn how to establish insider threats and report incidents correctly and promptly.
Diversify Crucial Provide Chains
Strategic investments ought to deal with constructing raw-material provide chains from North American, Australian and Nordic sources to reduce reliance on Chinese language inputs. The Dutch authorities ought to promote public-private funding applications which help joint mining and refining operations in addition to rare-earth recycling ventures between the Netherlands, the usAustralia and Nordic international locations.
NATO also needs to its cyber protection tasks to guard financial infrastructure methods that function inside dual-use sectors as a part of such an expanded mandate. A fast-response cyber group that handles industrial espionage assaults will function a safety measure towards steady spying actions.
Chinese language intelligence operations within the Netherlands and world wide display an organized strategy to disrupt innovation networks and collective safety methods. Protection Minister Brekelmans’ warnings match established U.S. evaluations which affirm that Chinese language government-backed actions more and more deal with allied infrastructure and high-tech sector methods.
It’s important, then, that the U.S. and the Netherlands ought to strengthen their strategic partnership on these points by enhanced collaboration on cyber protection and export controls and counterintelligence frameworks whereas on the similar time working in tandem with western and allied governments to that finish. The transatlantic protection coalition stands because the strongest barrier to cease western technological sovereignty from being stealthily degraded by its ruthless rivals.
Opinions expressed are these of the writer and don’t characterize the views or opinions of The Cipher Transient.
The Cipher Transient is dedicated to publishing a spread of views on nationwide safety points submitted by deeply skilled nationwide safety professionals.
Have a perspective to share based mostly in your expertise within the nationwide safety discipline? Ship it to Editor@thecipherbrief.com for publication consideration.
Learn extra expert-driven nationwide safety insights, perspective and evaluation in The Cipher Transient
