Factbox: Want billions to make US chips? Here is how to get them

WASHINGTON, Feb 28 (Reuters) – The Biden administration, which is making a $52 billion push to build more chips in the United States, said on Tuesday the initiative would require companies attracting taxpayer dollars to cover excess Giving back profits and making childcare affordable.

According to a report by the Semiconductor Industry Association and the Boston Consulting Group, the US share of modern global chip manufacturing capacity had fallen from 37% in 1990 to 12% by 2020.


Chip giant Intel Corp (INTC.O) has broke ground on a $20 billion chip factory in Ohio after passing the Chip Act.

Other companies interested in the funds include GlobalFoundries Inc (GFS.O), which has announced it will accelerate expansion plans at its manufacturing facility in Malta, New York, and SkyWater Technology Inc (SKYT.O).

Foreign companies such as NXP Semiconductors NV (NXPI.O), Samsung Electronics Co Ltd (005930.KS) and chip manufacturing leader Taiwan Semiconductor Manufacturing Co (2330.TW) have also either expressed interest or started factory planning.

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The Commerce Department said it will consider applications for funding based on the emphasis placed on research and development in the rapidly innovative industry, including participation in the new National Semiconductor Technology Center created by the CHIPS Act to support research to advance

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The CHIPS program office will “strongly prefer” projects that are primarily financed with private capital.

When deciding on the allocation of subsidies, the department also takes environmental aspects into account, such as whether a plant uses renewable energies. The department stressed that it hopes companies owned by minorities, women or veterans would help build and deploy facilities once they are operational.

Working together with allies, avoiding enemies:

The CHIPS law requires companies accepting US funds to agree not to make major expansions of foreign semiconductor manufacturing facilities in “countries of concern” like China for a decade, with some exceptions.

The Commerce Department said it wants to create opportunities for less developed countries to join the chip supply chain, noting in particular countries in the Americas and the Indo-Pacific Economic Prosperity Framework, which includes countries like Indonesia, Singapore and Vietnam.


The Commerce Department stressed that one goal of the initiative is to ensure that the people building, upgrading or expanding existing chip-making facilities come from a variety of backgrounds, including minorities, women and veterans.

The department also said workers hired to build factories or chips should be able to join unions.

The department wants companies participating in the project to have a “robust plan” for providing workers with things like transportation assistance and housing assistance.

Any applicant seeking funding greater than $150 million must submit a plan for access to affordable and quality child care for both facility and construction workers.


The CHIPS program office announced it would release two additional funding opportunities this year: one for semiconductor materials and manufacturing facilities in late spring and one for research and development facilities in the fall.

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Funding could take the form of grants, loans and loan guarantees, with the program office determining the level of funding on a case-by-case basis. The total funding would not exceed 35% of the project investment, it said.


The CHIPS program office requires any company that has received more than $150 million to return money if it makes more than planned. It will also seek details of any proposed share buybacks and will prioritize applicants who promise to limit or refrain from doing so.

Reporting by Diane Bartz, Jane Lee, Andrea Shalal and Stephen Nellis

Our standards: The Thomson Reuters Trust Principles.

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