Amsterdam (AFP) - A Dutch court on Wednesday ordered a formal investigation into alleged mismanagement at Nexperia, a Chinese-owned chip firm at the centre of a global tug-of-war over critical semiconductor technology.

The firm, based in the Netherlands but whose parent company is China’s Wingtech, has been the subject of a standoff between Beijing and the West, which threatened to hobble car manufacturers that rely on its chips.

”(The court) finds that there are valid reasons to doubt the sound policy and conduct of business at Nexperia and orders an investigation,” said the Amsterdam-based Enterprise Chamber in a statement.

The investigation is expected to take several months.

The court had previously played a key part in the row over Nexperia in October when it suspended the Chinese CEO Zhang Xuezheng, also known as Wing, citing concerns over his management.

These measures remain in force with the opening of the probe, the court said.

“The director remains suspended. The appointment of a temporary director at Nexperia and the transfer of the shares in Nexperia remain in effect,” said the court in a statement.

The court found there was “negligent conduct involving a conflict of interest.”

In addition, the court said Wing changed the firm’s strategy without consulting the other board members, refused to honour agreements with Dutch officials and crimped the powers of European Nexperia executives.

- ‘Scorched earth’ policy -

During hearings last month in the court, lawyers for Nexperia accused Wingtech of a “scorched earth” policy in its bid to wrest control of the company.

One of the firm’s lawyers, Jeroen van der Schrieck, said Wingtech was “doing everything to destabilise Nexperia, already under pressure from a crisis situation”.

Wingtech representatives responded that the Dutch intervention was “incomprehensible” and meant the row “degenerated needlessly”.

Wing did not attend last month’s hearings. His lawyer said the case had taken a toll on his health and he did not feel strong enough to appear in person.

In addition to the court order, the Dutch state waded into the row, using a Cold War-era law for the first time to effectively seize control of the company.

This sparked fury in Beijing, which responded by banning re-exports of the firm’s chips. The chips are sent to China for finishing before being shipped to customers.

Carmakers warned of major production problems as the components are critical to onboard electronics.

China softened its stance in November, reportedly as part of a trade deal agreed by President Xi Jinping and his US counterpart Donald Trump.

In response, the Dutch government suspended its proposed takeover, taking some of the heat out of the row.

The firm is no stranger to regulatory concerns in the West.

The United States put Wingtech on one of its “entity lists” last December, meaning the government believed it was acting against US national security and foreign policy interests.