Shares of ASML Holding NV declined after US lawmakers criticized the Dutch chip equipment manufacturer for allegedly enhancing China's semiconductor capabilities, prompting concerns about potential additional export restrictions on its lithography machinery.

ASML shares slipped 2% in premarket.

According to the House China panel on Tuesday, ASML and other equipment manufacturers like Tokyo Electron Ltd, Applied Materials Inc., KLA Corp., and Lam Research Corp., have garnered significant profits from selling equipment to Chinese companies linked to the state and military. The panel pointed to the companies' sales data but noted no allegations of legal violations by these tool makers under US, Dutch, or Japanese law.

The panel expressed concerns that China's progress in chip manufacturing "poses threats" to US national security.

The stocks of other semiconductor equipment companies are also experiencing a downturn.

ASML is recognized as the lone global producer of advanced lithography machines necessary for creating high-end chips used in diverse applications ranging from electric vehicles to military equipment. The Dutch firm has not been permitted to sell its most advanced machines to China due to export restrictions led by the US.