The German government on Wednesday blocked prospective Chinese investment in two domestic semiconductor producers after the moves raised concerns over national security and the flow of sensitive technological know-how to Beijing.
The government said it had vetoed the takeover of the chip factory of the Dortmund-based company Elmos by Silex, a Swedish company that is a subsidiary of Chinese group Sai Microelectronics.
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Berlin also blocked investment in ERS Electronic, which is based in the southern state of Bavaria, government sources told Reuters. A spokesperson for ERS Electronic said there was no plans to sell the company but it had been exploring the option of getting investment from a Chinese private equity firm.
The decisions came at a time of heightened sensitivity around relations between Berlin and Beijing.
The government of Chancellor Olaf Scholz, who visited China last week, is trying to balance a push for access to the Chinese market for European companies with addressing security concerns and reducing Germany’s trade reliance on China.
