MOEA readies regulations for semiconductor sector

Vice Minister of Economic Affairs Chen Ruey-long (陳瑞隆) said yesterday that his ministry will work out a supervisory mechanism with related government agencies and the semiconductor industry to regulate Taiwan semiconductor manufacturers' investments in China in the future.

Referring to the yet to be lifted restrictions on the semiconductor sector's investments in eight-inch wafer foundries in China, Chen said that he expects the government and the industry to reach consensus on such a mechanism before the end of this month.

The government is reluctant to allow the semiconductor sector to shift their investments to China for fear of weakening Taiwan's competitiveness. At a meeting last week, the government and the industry reached consensus that an effective supervisory mechanism should be established before lifting the ban.

Regarding the supervisory mechanism, the Taiwan Semiconductor Industry Association (TSIA, 半導體協會) has proposed that the government only allow investments in foundries of eight-inch wafers or of lower technological levels. As for related businesses such as IC designing and packaging, the association feels they should be taken off the control list.

In order that Taiwan business-people maintain their roots in Taiwan, the TSIA suggests that government permission to make investments in China only be given to those engaged in semiconductor R&D, design, packaging, testing, and manufacturing equipment and materials. Businesspeople in other sectors should not be allowed to invest in the semiconductor or IC manufacturing sector in China, according to the TSIA.

TSIA Secretary-General Chen Wen-hsien (陳文咸) said that the semiconductor sector also agreed that the corporate net assets of the investors should be under supervision of the authorities. Also, if an industrial group makes the investment, only the net assets of the semiconductor department will be under supervision.