ESIA, the association representing Europe’s semiconductor industry, is calling for the enactment of an “Instant Chip Act 2.0” if the European Union wants to maintain momentum in the global race for technology leadership.
The group includes major chipmakers such as NXP and Infineon, as well as research institutes such as imec and Fraunhofer.
The EU’s Chip Law came into force in September 2023. It aims to mobilise €43 billion in public and private investment to enable the EU to produce 20% of the world’s semiconductors by 2030.
In a statement on Monday, ESIA acknowledged the law was a “basic building block”, but argued the EU still needed to reconsider its scope, streamline the process and address gaps.
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One such measure is the speed-up of the State Aid regime, one of the most important regulatory mechanisms for attracting large international companies and increasing the number of semiconductor fabs in the country.
The EU has yet to approve state aid for Intel’s planned €30 billion megafactory in Germany. Last month, it finally approved €5 billion in aid for Taiwanese chip giant TSMC’s planned chip factory in Dresden, a year after it announced it would invest in the EU.
Free trade and the “holistic” policy approach
Another step, according to ESIA, is to support free trade.
The group advocates for a “more proactive approach to economic security” rather than a defensive strategy that “relies on restrictive and protective measures.”
The ESIA proposal reflects several export restrictions on ASML’s semiconductor manufacturing equipment to China amid ongoing tensions with the United States.
And with the Dutch government now considering further restrictions (under pressure from the US), China is reportedly considering cutting ties with ASML altogether, which would deprive the company of one of its largest markets.
Finally, the ESIA suggests ongoing competitiveness checks and a coordinated, “holistic” industrial strategy involving industry players.
This also includes special agencies within the European Commission.
“We need a dedicated ‘chip envoy’ to be responsible for overall industrial policy efforts on semiconductors,” the group said.
