A state-backed company in China has begun manufacturing immersion deep ultraviolet (DUV) lithography machines to help the country’s chipmakers reduce their reliance on foreign-made tools.

Citing two people familiar with the situation, The Information reported that the Shanghai-based company plans to manufacture around five DUV machines this year, increasing to roughly 20 in 2027.

While the report did not name the company, the sources claimed immersion DUV development teams from other Chinese companies, including a state-backed chip equipment startup called Shanghai Yuliangsheng Technology, were brought together in order to facilitate the project.

The systems set to be delivered this year are expected to go to local chipmakers, Semiconductor Manufacturing International, Hua Hong Semiconductor and memory maker ChangXin Memory Technologies, the report added. All three of those companies are named in the MATCH Act as companies that ASML would be banned from selling to or serving, should the bill pass through Congress.

Lithography is a wafer-patterning technique necessary for the manufacturing of the most advanced chips. At present, ASML dominates the market for DUV and extreme ultraviolet (EUV) lithography tools, with the company expecting to ship 130 DUV immersion systems in 2026.

This is not the first time someone has sought to challenge ASML’s market dominance. In October 2025, US startup Substrate claimed to have developed a chipmaking tool that could compete with the Dutch company’s offering.

Meanwhile, in the UK, the University of Southampton has opened the first electron-beam (e-beam) lithography facility in Europe. This technique uses a focused beam of electrons to create patterns in materials that are too small to fabricate with conventional photolithography.