Chip regulation: Council sets position – Consilium

The Council adopted its position (“general approach”) on the proposal for a regulation on a framework of measures to strengthen the European semiconductor ecosystem, better known as “chip regulation“.

With this regulation, it is current lack for semiconductors in Europe. The EU aims to achieve at least 10% global market share in semiconductors by 2030 doubleto ensure the EU’s technological sovereignty in the future.

Chips are one of today’s most important breakthrough technologies, but the EU currently does not have sufficient capacity to design and produce mature and advanced chips itself. The EU needs to get away from its excessive dependence on manufacturers in Asia and the USA, and with the chip regulation you are taking matters into your own hands.

Jozef Síkela, Minister of Industry and Trade of the Czech Republic

Less dependency

Chips are essential to a wide range of technological and digital products, such as cars, home appliances and electronics. Due to geostrategic issues and supply chain disruptions, European industry is struggling to procure semiconductors. The chip regulation was supposed to make the EU less vulnerable and less dependent on external actors. This will improve supply, resilience and technologically sovereignty of the EU in the area of ​​chips is moving forward.

Financial architecture

The regulation mobilizes 43 billion euros of public and private investments around 3 pillars:

  • The Chips for Europe initiative to support technological capacity building and the research and innovation required for this
  • a new framework to ensure security of supply and resilience by attracting more investment
  • a mechanism to monitor the semiconductor supply chain and coordinate measures in crisis situations

Of the total amount goes 3.3 billion to column 1, the initiative Chips for Europe. The Council clarifies that the 1.65 billion euros from Horizon Europe should go to research and innovation, and that the funds from the Digital Europe program should be used for capacity building.

In line with the existing interinstitutional agreement on the multiannual financial framework, the Council’s position does not envisage the reuse of released resources from Horizon Europe, as proposed by the Commission. This means that the total funding from the Digital Europe program is €400 million less. The Council therefore requests the Commission in a declaration to find alternative solutions together with the Member States and the European Parliament to reach the total amount hold 3.3 billion euros.

European Chip Infrastructure Consortium

The Regulation proposes the possibility of a new legal instrument: a European Chip Infrastructure Consortium (ECIC). As a legal entity, ECIC actions and other tasks with support from the Chips for Europe initiative.

The Council points out that the creation of an ECIC voluntarily and that it must be open to different legal forms of cooperation and other participants. The council also lays down rules for the selection of funding proposals, which do not take into account the legal form of cooperation.

The Council’s mandate

The council also proposes clarifications regarding:

  • the definition of a “cutting-edge” semiconductor manufacturing facility
  • the formulation of the general and operational objectives and content of the Chips for Europe initiative
  • establishment of a European network of centers of excellence for semiconductors, integration technologies and system design
  • the requirements to be met by integrated manufacturing facilities and open EU foundries, in particular for positive spillover effects on the semiconductor value chain in the EU
  • the design of mandatory information requests in a crisis phase
  • the scope and implementation of the emergency toolbox
  • enforcement of information and notification obligations as well as priority obligations through fines and sanctions

Next step

The general approach reached constitutes the Council’s formal negotiating position. This gives the Presidency of the Council a mandate for further negotiations with the European Parliament once it has determined its position.

To the “Meetings” page.

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