China’s Wingtech faces setback as Dutch court keeps Nexperia CEO suspended, orders probe

A Netherlands court has upheld the suspension of Zhang Xuezheng, former CEO of Dutch chipmaker Nexperia, and ordered an investigation into the company’s governance – another setback for Chinese parent company Wingtech.“The Enterprise Chamber … acknowledges that Nexperia faced complex dilemmas due to geopolitical developments. However, this does not mean that an investigation should be omitted in this case,” the court said in its ruling, published on Wednesday.The court found there were valid grounds to doubt Nexperia's policy and business conduct and, in a separate statement, stated the investigation is expected to last up to six months.It said it had decided to maintain Zhang’s suspension to allow the company to exercise firm leadership free from internal disputes and shareholder conflict, judging that Nexperia’s immediate priorities would be restoring stability, repairing internal relationships, securing its supply chain and ensuring reliable deliveries to customers.The court-appointed temporary director would remain in place, and nearly all shares would continue to be held by a court-appointed administrator, it added.The Enterprise Chamber – a special Dutch court handling corporate disputes – would soon appoint two investigators to examine Nexperia’s governance from the end of 2023, as well as recent supply chain disruptions and the de facto split with Nexperia China since last October, according to the ruling.In a statement, Wingtech expressed regret at the decision and vowed to pursue the restoration of its full shareholder rights “through all available legal means”. It said the court’s decision to maintain the temporary measures would continue to weigh on business, reiterating that it had still not been presented with any evidence justifying the actions.