ESIA welcomes the European Chips Act

The European Commission has taken an important step for regaining its digital sovereignty by publishing the “Chips Act for Europe”. The draft legislation focuses on the European semiconductor industry as a key enabler of technologies that render modern societies possible. Its swift and thorough implementation should be a top priority for EU legislators, and ESIA urges the European Parliament and Council to accelerate its deliberations toward timely adoption.

Since the summer 2020, an extraordinary surge in demand has disrupted the delicate balance of the European semiconductor industry’s supply chain. Monitoring developments in the global demand and supply of semiconductors will help better anticipate and respond to such situations. Likewise, attracting investment for an increased manufacturing footprint in Europe is going to strengthen the supply for a multitude of sectors in the EU Single Market and ease future surges in demand.

ESIA is welcoming the political ambition from the European Commission and Member States to support the European semiconductor industry, to promote leadership in chip design, and to increase production capacities to reach 20% of the global share. For the latter, the EU has rightly defined investments in ‘first-of-a-kind' production facilities as a priority area, including through adapting state aid rules in a strictly targeted manner. We also welcome the emphasis on research and development and innovation as a key building block of the European Chips Act to strengthen intellectual property development in critical areas of the European industrial supply chain. ESIA is urging policy makers to ensure that R&D does address industry needs, so that Europe’s world-class research can be better converted into innovation capacity.

If European decision makers do not want to be left behind by the rapid development of such programmes in other regions, a competitive and agile toolbox as put forward in the European Chips Act should not be delayed any further.