Japan has formally protested China’s imposition of export controls on key semiconductor manufacturing chemicals.

Japan protested China’s trade controls limiting exports of a critical chipmaking chemical on Tuesday, as Tokyo evaluates the potential financial and operational fallout on Japanese firms.

China imposed provisional anti-dumping measures on imports of dichlorosilane (DCS) from Japan after alleging that Japanese shipments violated trade regulations and damaged its domestic industry. Under the new rules, companies importing the chemical from Japanese suppliers must post cash deposits with Chinese customs at rates reaching up to 99.2%.

The financial levies target major Japanese exporters, including Shin-Etsu Chemical and Denal Silane. Dichlorosilane is a vital compound used in chemical vapor deposition processes to apply thin silicon layers onto semiconductor memory and logic chips. While global supply remains highly competitive, Japan is the primary global manufacturer of the ultrapure DCS necessary for advanced computer chip fabrication.

The export curbs were launched by China’s commerce ministry as part of a broader set of measures against Japan, alongside export controls on dual-use items with potential military applications. Bilateral relations between the two nations have grown increasingly tense following statements by Japanese Prime Minister Sanae Takaichi regarding potential military intervention if China acts against Taiwan.

Tokyo responded to the fresh trade restrictions by raising formal objections and pledging to protect its domestic business sector from regulatory harm. “Respond appropriately,” said Chief Cabinet Secretary Minoru Kihara, Japan’s top government spokesperson, noting that Tokyo aims to prevent unfair damage to Japanese companies.

Beijing noted that the tariff measures remain provisional while its investigation continues toward a final ruling.