Export Compliance Daily is providing readers with the top stories from last week in case you missed them. You can find any article by searching for the title or by clicking on the hyperlinked reference number.
CHIPS Act
The CHIPS and Science Act is a U.S. law signed by President Biden in August 2022. The act authorized approximately $280 billion in funding for domestic research and manufacturing of semiconductors. It included $39 billion to subsidize chip manufacturing in the U.S. and a 25% tax credit for the cost of manufacturing equipment. The bill provided $13 billion for semiconductor research and workforce training. It also invested $174 billion in public sector research in science and technology. The bill was intended to strengthen the resilience of American supply chains and to counter China.
The Commerce Department clarified this week that companies can’t use Chips Act funding to invest in certain new semiconductor facilities in China and other countries of concern, saying some companies may have thought the rules blocked only certain investments in existing facilities.
The Commerce Department on Dec. 11 announced its first federal grant under the Chips Act, saying it will award defense contractor BAE Systems about $35 million to improve its chip production facility in Nashua, New Hampshire. The funding was announced about three months after the agency finalized its guardrails for the grants (see 2309220035), which are designed to improve the state and capacity of American semiconductor manufacturing and innovation.
The U.S. should convince Japan, the Netherlands and other allies to restrict exports of lower-level chipmaking equipment to China to prevent Beijing from becoming the global leader in the "foundational" semiconductors those tools can produce, the Silverado Policy Accelerator think tank said in a new report last week. The report warned that current restrictions on advanced equipment risks pushing China to instead dominate the foundational chip sector, which will increase the likelihood that those semiconductors will be incorporated in U.S. defense technologies and could help Chinese companies “climb the value chain in leading-edge nodes, whether through legitimate or illegitimate means.”
U.S. allies in Europe and Asia would support new efforts to coordinate on export controls for advanced technologies, including semiconductors, panelists said during an event this week hosted by the Center for Strategic and International Studies. But they also said those same countries don’t believe the world needs a new dual-use multilateral export control regime to replace the Wassenaar Arrangement, even though Russia remains a member and can block proposals.
Export Compliance Daily is providing readers with the top stories from last week in case you missed them. You can find any article by searching for the title or by clicking on the hyperlinked reference number.
The Commerce Department last week released the final version of its guardrails for recipients of Chips Act funding, measures it said will prevent its semiconductor industry grants from being used to benefit certain “foreign countries of concern,” including China.
The Bureau of Industry and Security needs more resources to investigate export control violations, Commerce Secretary Gina Raimondo said this week. She also said a potential government shutdown would be “crushing” for the agency’s enforcement efforts and work on semiconductor export regulations.
The U.S. doesn't have to sacrifice innovation when imposing new regulations on artificial intelligence, including through potential export controls, said Jack Corrigan, a senior research analyst at Georgetown University’s Center for Security and Emerging Technology (CSET). Corrigan said there is always “tension” between the government’s desire to issue restrictions and industry’s drive to develop new technologies, but “as it relates to AI, regulation doesn't necessarily need to get in the way of innovation.”
The U.S. government must take a host of actions to slow down Chinese "techno-economic dominance," including preventing Chinese firms from being listed on U.S. stock markets and limiting investment into China, Robert Atkinson, president of the Information Technology and Innovation Foundation, said in an Aug. 28 post.