South Korea has asked Washington to review its criteria for new semiconductor subsidies, concerned over the impact of rules to limit chip investment in countries such as China, a US public filing showed.
In March, the US Department of Commerce proposed rules to prevent China and other countries it deems to be of concern from tapping funds of US$52 billion earmarked for semiconductor manufacturing and research under the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act.
A leading chipmaker and major investor in the US chip sector, South Korea asked the US to review the rule that prevents recipients of US funding from building new facilities in such countries, beyond 5 percent of existing capacity.
Photo: Reuters
“The Republic of Korea believes ‘guardrail provisions’ should not be implemented in a manner that imposes an unreasonable burden on companies investing in the United States,” South Korea said, using its official name.
The filing gave no further details, but the South’s Yonhap news agency said Seoul had asked to raise the limit to 10 percent.
The South Korean Ministry of Trade, Industry and Energy declined to comment.
Washington has said the incentives aim to help restore the US’ leadership in semiconductor manufacturing, boost employment, and ensure economic and national security.
South Korea’s Samsung Electronics Co and SK Hynix Inc, the world’s top two makers of memory chips, have invested billions of dollars in chip factories in China.
Samsung is building a chip plant in Texas that could cost more than US$25 billion.
In its comments, Samsung sought clarification of the proposed rule to ensure that investments in the US chipmaking sector were “not unduly and unintentionally restricted,” a filing showed.
SK Hynix also made comments, but the public version gave no details.
Its parent, SK Group, which plans to invest US$15 billion in the US chip sector, some for an advanced chip packaging factory, has said it is considering applying for funding.
“Potential CHIPS Act funding recipients have numerous existing legacy facilities in China,” an industry group, the Semiconductor Industry Association, said.
“It is critical for these companies to be able to protect their past investments in these facilities by ensuring they remain commercially viable,” it said.
SK Hynix and Samsung Electronics did not immediately provide comments to Reuters.
The United Auto Workers union has said funding applicants should be ruled ineligible if they did not agree to allow union organizing.
“The US government should not be in the business of funding union-busting employers,” it said in a filing on Tuesday.
The commerce department began accepting subsidy applications for leading-edge chip facilities in March. On June 26, it is to open applications for “current-generation, mature-node and back-end” production facilities.
Shares of contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) came under pressure yesterday after a report that Apple Inc is looking to shift some orders from the Taiwanese company to Intel Corp. TSMC shares fell NT$55, or 2.4 percent, to close at NT$2,235 on the local main board, Taiwan Stock Exchange data showed. Despite the losses, TSMC is expected to continue to benefit from sound fundamentals, as it maintains a lead over its peers in high-end process development, analysts said. “The selling was a knee-jerk reaction to an Intel-Apple report over the weekend,” Mega International Investment Services Corp (兆豐國際投顧) analyst Alex Huang
TRANSITION: With the closure, the company would reorganize its Taiwanese unit to a sales and service-focused model, Bridgestone said Bridgestone Corp yesterday announced it would cease manufacturing operations at its tire plant in Hsinchu County’s Hukou Township (湖口), affecting more than 500 workers. Bridgestone Taiwan Co (台灣普利司通) said in a statement that the decision was based on the Tokyo-based tire maker’s adjustments to its global operational strategy and long-term market development considerations. The Taiwanese unit would be reorganized as part of the closure, effective yesterday, and all related production activities would be concluded, the statement said. Under the plan, Bridgestone would continue to deepen its presence in the Taiwanese market, while transitioning to a sales and service-focused business model, it added. The Hsinchu
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has approved a capital budget of US$31.28 billion for production expansion to meet long-term development needs during the artificial intelligence (AI) boom. The company’s board meeting yesterday approved the capital appropriation plan for purposes such as the installation of advanced technology capacity and fab construction, the world’s largest contract chipmaker said in a statement. At an earnings conference last month, TSMC forecast that its capital expenditure for this year would be at the higher end of the US$52 billion to US$56 billion range it forecast in January in response to robust demand for 5G, AI and
Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) investment project in Arizona has progressed better than expected, but it still faces challenges such as water and labor shortages, National Development Council (NDC) Minister Yeh Chun-hsien (葉俊顯) said yesterday. Speaking with reporters after visiting TSMC’s Arizona hub and attending the SelectUSA Investment Summit in Maryland last week, Yeh said TSMC’s Arizona site turned a profit of NT$16.14 billion (US$514 million) last year in its first full year of mass production. “TSMC told me it was surprised by the smooth trial run of the first fab, which has left the company optimistic about the project’s outlook,”
RSS