European Parliament Advances a More Robust Chips Act
By Alison James, IPC senior director, European government relations
The European Parliament this week took important steps towards advancing a more robust European Chips Act. In its negotiating position on the draft legislation and on the Chips Joint Undertaking, the European Parliament brought welcome and fresh emphasis on strengthening the European semiconductor packaging capability and enabling a more robust electronics ecosystem.
The EU Chips Act, like the U.S. CHIPS Act, is a response to geopolitical developments and supply chain vulnerabilities. It is, amongst other things, aimed at building out Europe’s capacities and capabilities in innovative technologies. It provides a framework for state aid clearance for Member States to close the funding gap for so-called “first of a kind” facilities. It sets out mechanisms for European authorities to have greater visibility into supply chains to avoid future disruptions and to intervene in the event of “a crisis.”
IPC welcomes the European Chips Act as an important step towards strengthening European leadership in innovation and secure and resilient supply chains. As always, the devil is in the details. In our position on the initial draft legislation, IPC highlights that truly strengthening the EU’s technological leadership and autonomy requires a “silicon-to-systems” approach – not only producing more chips but also enhancing the bloc’s capabilities and capacities to package semiconductors into advanced components and systems. A silicon-to-systems strategy requires greater policy and funding support for key strategic industry segments, including electronic assembly and printed circuit board fabrication.
As the European Chips Act advances through the Trilogue negotiations, during which a final agreement will be negotiated between the three EU Institutions, IPC will continue to urge the adoption of a final package that ensures the best benefits for Europe’s electronics manufacturers. As the EU discusses the next steps in developing its Industrial strategy, a silicon-to-systems perspective becomes ever more essential to support the region’s green and digital transitions. This means policy support is needed to bolster the entire electronics manufacturing ecosystem, making Europe a manufacturing centre of excellence, and fostering strategic trading partnerships.
IPC remains committed to working with the EU Institutions, public and private stakeholders in the next stages of the European Chips Act and seeking a more competitive, resilient and sustainable electronics industry.
For more information on the European Chips Act, contact me at AlisonJames@ipc.org.