EU Steps Up “Semiconductor Sovereignty” Plans

By Alison James, IPC Senior Director, Government Relations, Europe

Key Summary

• The European Commission plans to introduce a European Chips Act to expand cutting edge semiconductor manufacturing
• The proposal includes a research strategy, increased production capacity, and international cooperation
• EU leaders aim to strengthen supply chain resilience across design, production, packaging, equipment, and suppliers
• The goal is to develop European mega fabs capable of high volume advanced chip production
• IPC emphasizes that Europe must also invest in the broader electronics manufacturing ecosystem
• Studies show electronics manufacturing can drive economic recovery if policymakers take a holistic approach

The European Commission plans to introduce a “European Chips Act” to provide a European vision and strategy to boost cutting-edge semiconductor manufacturing capacity in the region.

The announcement was made by European Commission President Ursula von der Leyen during her State of the Union speech in Strasbourg on September 15. It comes as EU Member States are designing national strategies to develop industrial and production facilities to reduce foreign dependencies. 

In a related blog, Internal Market Commissioner Thierry Breton said the European Chips Act should cover three elements:

• A European Semiconductor Research Strategy to push Europe’s research ambitions to the next level;
• A collective plan to enhance European production capacity; and
• A framework for international cooperation and partnership.

Breton said the legislation should aim to support monitoring and resilience of the entire supply chain including design, production, packaging, equipment, and suppliers. The goal is to support the development of European “mega fabs” able to produce in high volume the most advanced and energy-efficient semiconductors, he said.

As these plans move forward, IPC will continue to underline the importance of investing in the broader electronics manufacturing ecosystem, not just semiconductors. As stated by IPC Thought Leadership Program member Matt Holzmann in a new EE Times commentary, “without other electronic components and interconnections … a computer chip cannot function. The modern world runs on electronic systems, not just computer chips.”

An IPC study in April 2021, Digital Directions, Greener Connections, concluded the electronics manufacturing industry has largely withstood the negative effects of the COVID pandemic and is poised to help drive Europe’s economic recovery and resilience, especially if government decisions take a holistic approach.

IPC will continue to work with European policymakers to discuss needed investments across the electronics manufacturing ecosystem so that Europe can truly achieve greater “tech sovereignty.”