by Chris Mitchell, IPC vice president, global government relations

Key Summary

• The U.S. Commerce Department released its first CHIPS Act funding opportunity for semiconductor facilities
• Eligible projects include leading-edge, current-generation, mature-node, and back-end assembly, testing, and packaging
• Application timelines vary by facility type, with rolling submissions beginning March through June 2023
• IPC welcomed progress but raised concerns about unclear eligibility for IC substrates, PCBs, and electronic assembly
• IPC urges a broader silicon-to-systems strategy to strengthen the entire semiconductor ecosystem

Today, the U.S. Department of Commerce released its first CHIPS for America funding opportunity to bolster U.S. semiconductor manufacturing. This first funding opportunity seeks applications for projects involving construction, expansion, or modernization of commercial facilities for the fabrication of leading-edge, current-generation, and mature-node semiconductors. The notice makes clear that eligible projects include both front-end wafer fabrication and back-end assembly, testing, and packaging.

Entities considering funding should submit a statement of interest soon. Pre-applications (optional) and full applications for leading-edge facilities will be accepted on a rolling basis beginning March 31, 2023. Pre-applications (recommended) for current-generation, mature-node, and back-end production facilities will be accepted on a rolling basis beginning May 1, 2023, and full applications for these categories will be accepted on a rolling basis beginning June 26, 2023.

The CHIPS Program Office hosted a webinar this afternoon. That webinar, as well as more information about this funding opportunity and other developments, can be accessed at www.chips.gov. Also, be sure to review the Commerce Department’s “Vision for Success” which lays out strategic objectives for U.S. semiconductor innovation and manufacturing.  

The IPC Perspective

IPC commends the Commerce Department for its expeditious implementation of the Chips and Science Act. Today’s funding announcement reflects the Department’s commitment to get the funding out to those technology leaders who can help realize the ambitious goals laid out by Congress.

On another positive note, the funding announcement clearly makes eligible projects related to advanced packaging. In fact, it identifies advanced packaging as critical to U.S. semiconductor leadership. This affirmation reflects significant progress on the part of the industry in helping federal policymakers better appreciate the role of advanced packaging in driving semiconductor innovation. 

However, the funding announcement refers only broadly to semiconductor “assembly, testing, and packaging.” Is IC substrate fabrication included? It should and we would expect it does, but the fact that the funding announcement does not specifically reference IC substrates is quizzical and unfortunate. It’s likely to contribute to a sense of uncertainty about the U.S. Government’s commitment to address a glaring vulnerability in the U.S. semiconductor supply chain.  

We, at IPC, are also concerned about the eligibility of projects related to printed circuit board fabrication and electronic assembly. Earlier this month, U.S. Commerce Secretary Gina Raimondo said in an interview with NPR that “circuit board” companies would have opportunities for CHIPS funding. This funding announcement, however, does not appear to make such project eligible, and it’s not clear that the planned funding announcements later this year do either.  In late spring 2023, the CHIPS Program Office intends to release a funding opportunity focused on the construction, expansion, or modernization of facilities for semiconductor materials and manufacturing equipment. In early fall 2023, the CHIPS Program Office intends to release a funding opportunity for the construction, expansion, or modernization of facilities for research and development.

IPC continues to call the U.S. Government to move beyond a silicon-only mindset and toward a silicon-to-systems innovation strategy. Bolstering chip production without commensurate growth in advanced packaging, PCB fabrication, and electronic assembly is likely to lengthen the supply chain and exacerbate glaring vulnerabilities in U.S. electronics manufacturing capacities and capabilities.    

by Suhani Chitalia, Environmental Regulatory Affairs Manager

Key Summary

• PFAS are widely used because of their unique performance properties, but their persistence has led to increased regulatory scrutiny.
• Electronics manufacturing depends on PFAS for semiconductors, wire and cable insulation, cable assemblies, and PCBs.
• Major policies include the EU REACH Annex XV Restriction Dossier and the U.S. EPA TSCA Section 8(a)(7) reporting requirements.
• Several U.S. states and global governments are pursuing independent PFAS restrictions or reporting mandates.
• Identifying PFAS in electronics is challenging due to the size and complexity of global supply chains.

Background:

Per- and polyfluoroalkyl substances (PFAS) are continuing to garner industry attention on a state, federal, and global level. This group of over 4,500 man-made chemicals has a wide range of uses - from consumer products to industrial applications. In fact, if you look in your home, you are likely to find dozens of products that potentially contain PFAS.

Why are these chemicals so widely used? Because they possess unique properties that often cannot be replicated by other substances. PFAS are known to provide repellency, elasticity, temperature, and chemical resistance, among other attributes.  

However, with thousands of varying chemical structures, it is difficult to know the effects that each individual PFAS chemical can have on human health and the environment. What is known is that PFAS are persistent chemicals, meaning they accumulate and remain in the environment for long periods of time. This is largely why more and more policy makers in both the United States and in Europe have been taking steps in recent years to regulate PFAS.

Electronics manufacturing has a reliance on PFAS for various applications, including semiconductors, wire and cable insulation and cable assemblies, and printed circuit boards (PCBs). PFAS also provides unique properties that are critical for electronics components, such as temperature resistance, chemical resistance, water and oil repellency, compressibility, flame retardancy, high stress and crack resistance, and much more. Further, PFAS contributes greatly to the functionality of electronics and other materials.

Policies:

PFAS regulations are being seen everywhere. IPC has been working diligently on tracking and advocating for electronics manufacturing on two major upcoming PFAS policies: The REACH Annex XV Restriction Dossier on PFAS and the Toxic Substances Control Act (TSCA) Section 8(a)(7) Reporting and Recordkeeping Requirements for PFAS. 

REACH Annex XV Restriction Dossier on PFAS:

 A REACH restriction is an EU policy mechanism implemented by the European Chemicals Agency (ECHA) to protect human health and the environment from risks posed by chemicals. Restrictions generally limit or ban the manufacture, placement on the market, or use of a substance. An EU Member State, or ECHA, at the request of the European Commission, can initiate the restriction procedure if they are concerned that a certain substance poses a risk.  

Recently, the national authorities of Denmark, Germany, the Netherlands, Norway, and Sweden submitted a proposal to ECHA to restrict PFAS under REACH. The nation’s first announced their intention to create the restriction, which will be one of the broadest in the EU’s history, in December 2019 and began collecting evidence in May 2020. The timeline for the restriction moving forward is as follows:

• The proposal was released on February 7
• The six-month consultation period will begin on March 22
• ECHA will hold an online information session on April 5, to explain the restriction process and help interested parties participate in the consultation process; and
• During the consultation period, the Committee for Risk Assessment (RAC) and the Committee for Socio-Economic Analysis (SEAC) will meet to consider the risks and impacts on society.

TSCA Section 8(a)(7) Reporting and Recordkeeping Requirements for PFAS:

The U.S. Environmental Protection Agency (EPA) has proposed a reporting and recordkeeping requirement for PFAS under TSCA. Following amendments to TSCA implemented by the FY 2020 National Defense Authorization Act (NDAA), the EPA proposed that persons who manufacture (including import) PFAS since January 1, 2011, must report information on their PFAS uses, production volumes, disposal methods, potential exposures, and hazards.

 The EPA also recently released an Initial Regulatory Flexibility Analysis (IRFA) on this proposed rule, which highlighted the costs associated with the rule and its potential impact on small businesses. The final rule is expected to be published in Q1 of 2023.

Other PFAS Policies:

PFAS has sparked policies on a local and global scale. In the United States, several states have proposed legislation to limit or ban PFAS in its entirely. One notable example is the state of Maine, which recently passed a first-in-the-nation law that prohibits products made with PFAS chemicals. The law will take effect 2030, but companies are required to report their PFAS uses starting January 1. This deadline has led to hundreds of companies filing for a six-month extension to report their PFAS usage.

On a global scale, many countries are also starting to consider the impacts of PFAS and how regulations can effectively address potential risks associated with these chemicals. For example, the French Ministry of Ecological Transition and Territorial Cohesion recently launched an action plan for 2023-2027 to “strengthen the protection of the French people and the environment against the risks associated with PFAS.”

Impacts of PFAS Policies:

The electronics industry is complex, with multi-tiered manufacturing processes and an intricate and complex supply chain. Identifying PFAS in this industry is a challenge, not only due to the sheer number of chemicals falling into the “PFAS” category, but also due to the resources needed to identify them.

At IPC, we encourage the electronics industry to examine their supply chain to better understand where PFAS exists, how it is used, what properties they are used for, and whether alternatives exist. Reporting PFAS usage and the possibility of bans is on the horizon, and the best way for the industry to respond is by preparing and providing policy makers with data and facts on PFAS use.

Chemical regulations are not a new concept, but a broad PFAS ban has the potential to greatly impact the electronics industry. The time for preparation is now.