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European Parliament set to undertake its ultimate place – EURACTIV.com

Because the parliamentary committee accountable for the file prepares to undertake its ultimate place on the semiconductor regulation subsequent week, EURACTIV provides an summary of the primary modifications.

Final week, the European Parliament’s Trade, Analysis and Power (ITRE) Committee finalized its model of the Semiconductor Regulation (Chips Act). This EU initiative goals to strengthen Europe’s semiconductor capabilities and set up a mechanism to stop and handle provide chain crises.

The report, obtained by EURACTIV, is because of be voted on subsequent Tuesday (24 January). It’s anticipated to be adopted in Parliament’s plenary session in February, with a view to launching trilogue negotiations with the Council and the European Fee in March.

The mega fabs

The Semiconductor Regulation units out the situations for granting state help to ‘first-of-its-kind’ services, often called ‘mega-fabs’. These mega-fabs could possibly be engineered for a wide range of functions, equivalent to designing, packaging, and manufacturing semiconductors.

As well as, the standards for factories to qualify as “first of their form” have been expanded. Specifically, they must contribute to the resilience of the semiconductor ecosystem and implement new or modern parts that may, for instance, enhance the effectivity of the manufacturing course of or assure the security of elements.

Emergency measures

The Semiconductor Regulation gives for an emergency mechanism to stop and handle scarcity conditions. The ultimate report emphasizes dialogue between authorities and business. Specifically, skilled associations have been tasked with establishing info assortment whereas guaranteeing cybersecurity.

The semiconductor disaster has been outlined as “a severe and extraordinary disruption of the semiconductor provide chain, which prevents the provision, restore or upkeep of important merchandise within the semiconductor provide chain”.

The textual content stresses that the triggering of this disaster standing have to be based mostly on concrete and dependable proof, thus lowering the discretionary energy of the Fee. As well as, the knowledge to be offered by the gamers within the sector has been restricted to a pre-established checklist of early warning indicators.

These indicators can be developed as a part of a long-term strategic mapping train that the EU government ought to perform in session with nationwide authorities and market representatives.

Important sectors

The disaster mechanism prone to result in the deployment of an emergency toolkit focuses on important sectors. These sectors initially corresponded to these of the Directive on the resilience of important entities, in addition to sure further sectors, equivalent to defence.

MEPs then determined to change the method by itemizing the important sectors within the annex to the semiconductor regulation, in order that the regulation could be amended instantly. On the identical time, MEPs added a clause stipulating that, previous to the activation of the disaster section, the important sectors should show that they’ve fulfilled their duties when it comes to threat mitigation.

A disputed component on this regard was whether or not the automotive business, one of many hardest hit by the present scarcity of semiconductors, ought to be included. The result’s somewhat ambiguous: transport is included, however whether or not this additionally applies to automotive producers stays open to interpretation.

Funding

Funding is prone to be a serious sticking level with the Council of the EU, the opposite co-legislator which agreed its place in December. Member states, historically reluctant to spend cash, minimize €400 million from the funding out there for the initiative.

Alternatively, MEPs are extra ” formidable “ on this situation and name for extra funds to be allotted in the course of the mid-term assessment of the Multiannual Monetary Framework — the seven-year EU funds.

The goal is to search out new sources and keep away from funding the regulation on semiconductors to the detriment of different present European packages, such because the “Horizon Europe” programme.

Worldwide cooperation

The report emphasizes worldwide cooperation, calling on the Fee to ascertain a diplomatic initiative on semiconductors with like-minded international locations to assist forestall provide chain disruptions.

Export restrictions had been added as main causes of provide chain disruptions. That is an implicit reference to america, which has unilaterally blocked the export of key semiconductors to China, thus undermining its rising know-how sector.

The Fee must also consider commerce insurance policies, enterprise closures, relocation or acquisition of key European gamers when coping with third international locations.

Mental property rights

The safety of mental property (IP) rights has been strengthened all through the textual content, particularly by imposing strict obligations on the European Fee and nationwide authorities with regard to the administration of confidential info shared by personal entities.

MEPs additionally included provisions to stop firms benefiting from state help below the Semiconductor Regulation from establishing in international locations equivalent to China, the place mental property rights should not revered. attributable to counterfeiting, theft and compelled know-how transfers.

Geographical stability

The semiconductor regulation has raised issues amongst smaller member states who feared it could solely profit bigger member states with larger monetary means. Subsequently, the rapporteur Dan Nica confused in his preliminary report the necessity to guarantee a geographical stability.

Nevertheless, though sure references to the upkeep of the territorial cohesion of the EU stay, this level has regularly turn into marginal within the discussions. Semiconductor manufacturing is certainly a sector that favors geographic focus, provided that it’s capital and know-how intensive.

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