Update on the European Chips Act – Three Pillars Explained

On March 29, the European Commission and DG Connect held an informative session on the EU Chips Act, explaining the most important initiatives and framing the corridor of what to expect for the member states in the course of the Chips Act.

We have summarized the most important takeaways for Silicon Alps partners.

*All slides are provided by DG Connect. All slides can be downloaded here

THREE PILLARS explained

First and foremost, the Chips Act is built on 3 pillars: Chips for Europe Initiative, Security of Supply, Monitoring and Crisis Response.

 

Pillar 1: Chips for Europe Initiative

Accordingly to the slogan “Bridge the gap from lab to fab” the Chips Act seeks to make the R&D ecosystem faster in terms of quick innovations that are ready-for-market, user- and industry-friendly. Moreover, better and easier access to funding and platforms for startups and SMEs is a clear objective of pillar 1.

There are 5 main objectives
– Greatly improve design skills (this includes a skills program for SMEs and startups).
– Establish a Chips Fund for fast funding for innovation projects
– Improve pilot lines and establish new ones
– Drive Quantum Chips development
– Establish a network of competence centers in Europe
APST will have an important role as Advisor within the Chips Act, but there is a new instance (see slides on this down below.

Also important and emphasized several times: other initiatives like APST or IPCEI are complementary, i.e. nothing is replaced there and serves other phases in the Value Chain.

Pillar 2. Security of Supply

The core of Pillar 2 are first-of-a-kind facilities. These FOAKs are planned in 2 groups, either as IPF (Integrated production Facility) or Open Foundries – according to presenter Kilian Gross, everyone falls inevitably into one of the 2 groups, there should be no hybrids, as they assure. Companies can apply with a number of conditions and criteria and up to 100% of the funding gap will be covered as state aid.

 

Pillar 3: Preparedness, Monitoring and Crisis Response

– Pillar 3 is focusing on crisis management and establishing an infrastructure to identify impending shortages as quickly as possible and counteract them through joint resource planning.
– For this purpose, a new “expert group” has been convened, which has already held its first meeting and is eventually to become the “European Semiconductor Board”.
– A three-stage model is to monitor, trigger and – in the worst case – we come to the crisis stage. Thereafter a toolbox comes into play, but they emphasize that this will only be used in extreme emergencies, see slides below.
– Furthermore, the EC will act as a central purchasing point, as already has been done in the course of the pandemic with the central purchasing and distribution of vaccinations – this aims at strengthening the negotiation basis on the global market leading to better prices and a better overview of EU resources.

 

 

More Information on the EU Chips Act

Silicon Alps Summary

https://ec.europa.eu/commission/presscorner/detail/en/qanda_22_730

What is the European Chips Act about?

The European Chips Act will ensure that the EU has the necessary technological capabilities, tools and skills to strengthen its semiconductor ecosystem, reduce dependencies and accelerate the digital and green transitions. Its main components are:

  • The Chips for Europe Initiative will pool resources from the Union, Member States and third countries associated with the existing Union programmes, as well as the private sector, through the enhanced Chips Joint Undertaking resulting from the strategic reorientation of the existing Key Digital Technologies Joint Undertaking. €11 billion will be made available to strengthen existing research, development and innovation, to ensure the deployment of advanced semiconductor tools, pilot lines for the prototyping, testing and experimentation of new devices for innovative real-life applications and to foster skills and talent in the microelectronics. In addition, a Chips Fund will facilitate access to finance for start-ups to help them mature their innovations and attract investors.
  • A new framework to ensure security of supply by attracting investments in new advanced production facilities and thus accelerating innovation in advanced nodes and innovative and energy efficient chips.
  • A coordination mechanism between the Member States and the Commission for monitoring the supply of semiconductors, estimating demand and anticipating and mitigating shortages.

 

The agenda of the information session: