Chipmakers hoping to faucet into the Biden administration’s $39 billion semiconductor manufacturing subsidy program might want to signal agreements promising they received’t broaden manufacturing capability in China. The requirement was amongst a handful of funding circumstances the US Commerce Division outlined this week after it will start accepting functions for cash from the CHIPS Act in late June. Congress the $280 billion measure final July in a uncommon present of bipartisan cooperation and put aside $52 billion in tax credit and funding for US semiconductor corporations to broaden home manufacturing.
“Recipients will likely be required to enter into an settlement proscribing their capability to broaden semiconductor manufacturing capability in overseas nations of concern for a interval of 10 years after taking the cash,” Commerce Secretary Gina Raimondo advised reporters, per the . Raimondo didn’t title China by title. Nonetheless, the superpower is among the many nations the US authorities considers a “overseas nation of concern.”
Moreover, Raimondo mentioned CHIPS Act recipients can’t “knowingly interact in any joint analysis or expertise licensing effort with a overseas entity of concern that entails delicate applied sciences or merchandise,” a requirement doubtless designed to discourage home corporations from signing agreements just like the one Ford lately .
“I additionally need to be clear that no CHIPS {dollars} might be spent on inventory buybacks,” Raimondo mentioned. “That is about investing in our nationwide safety, not enabling these firms to make use of our cash to extend their earnings.” The Commerce Division may even require firms making use of for greater than $150 million to stipulate how they plan to offer reasonably priced childcare to staff, a funding situation Raimondo mentioned displays the present labor market. In some situations, the company could require those self same recipients to return a number of the cash they obtain from the CHIPS Act to the federal government in the event that they generate extra earnings.
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