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27 Jan 2023

NL Times

Millions of computer chips from Dutch manufacturers found in Russian weapons, new investigations shows; incl. cos. comments

Millions of computer chips from Dutch manufacturers wound up in Russia: Report, 27 January 2023

Several million microchips produced by Dutch manufacturers, including NXP and Nexperia, wound up in Russia last year in shipments that were handled by resellers after sanctions were in place as a consequence of Russia's invasion of Ukraine. Hundreds of deliveries were made to three Russian companies connected to that country's defense industry, according to a new investigative report by NOS.

"A range of Dutch components are crucial to the Russian war machine," said James Byrne, the director of the open-source intelligence and analysis research group at the Royal United Services Institute. "These chips are regularly found in almost all types of Russian military drones and other precision weapons, such as cruise missiles."

The broadcaster's researchers, including those working for magazine program Nieuwsuur, identified a small group of Chinese companies that would continuously supply computer chips to Russia after receiving them from the Dutch manufacturers. The largest was Sinno Electronics, which is named on U.S. sanctions lists, but not by the European Union. Other shipments involve smaller companies sending boxes through regular mail to Russia as a way of trying to avoid sanctions.

Byrne's think tank was asked by Ukraine last summer to examine 27 Russian defense systems and equipment. NXP chips were found in 10 of the 27 weapon systems. Chips from NXP have been found in Russian missiles, helicopters, and howitzers, NOS said, in addition to Iranian attack drones. Chips from both NXP and Nexperia have been found in Russian drones.

Both companies said they comply with all sanctions rules, that they do not do business with Russian firms, and that their clients are forbidden from selling the microchips to Russian organizations. A spokesperson for the Eindhoven-based NXP said that they "vigorously" screen their customers, and follow internal guidelines that are stricter than obligatory rules under the sanctions.

A spokesperson for Nexperia, headquartered in Nijmegen, told NOS that the resale of computer chips to third parties "cannot always be controlled or prevented by us." The company said they use software to monitor the distribution chain involving their chips. Anyone found violating sanctions is cut off from future supplies.

"The Netherlands is very concerned about this and, together with the European Union and other EU countries, is looking for effective ways to prevent this and to tackle brokering," the Dutch Ministry of Foreign Affairs told the broadcaster.

Part of the following timelines

Ukraine: Global outrage over Russian invasion leads to sanctions, demands for businesses to divest

Ukraine invasion: Crucial role of tech companies highlighted after Russian 'act of aggression'