Japan and the Netherlands became new allies of the United States in implementing export controls on semiconductor manufacturing equipment to China.
Citing a Bloomberg report, negotiators from the three countries are set to conclude the talks on Friday.
It is understood that the Netherlands and Japan will extend the ban on ASML Holding NV and Nikon Corp from selling machines essential for making certain advanced chips to Beijing.
The joint effort is seen to further expand the restrictions announced by the Biden administration in October last year.
It restricts China's ability to manufacture its own advanced semiconductors or aid its military and artificial intelligence capabilities by buying chips from abroad.
In response to the move, Beijing filed a dispute with the World Trade Organization in December to overturn the imposed export controls.
Seeing the impact of this report on related stocks, Tokyo Electron, which sells chip-making equipment to China, fell about 1%.
While Shanghai Semiconductor Manufacturing International Corp continued to decline by 2.1%, while Hua Hong Semiconductor Ltd. declined 1.5%.
