CHIPS Act 2025: A group of US lawmakers from both parties introduced a bill in the House on Thursday that would prevent recipients of CHIPS Act grants from buying Chinese chipmaking equipment for the next 10 years, as per a report. The legislation is designed to protect US chip manufacturing and reduce reliance on foreign technology, as per a Reuters report.
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The CHIPS Act, passed in 2022 under the Biden administration, was created to boost domestic chip production, as per the report. The law provided $39 billion to support the construction of new factories and expansion of existing facilities, with companies such as Intel, TSMC, and Samsung Electronics receiving grants, as per the Reuters report. In Intel’s case, some grant money was later converted into an equity stake by the US government, as per the report.
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Companies include Intel, TSMC, and Samsung Electronics, with Intel’s grant partially converted into a US government equity stake.
Does the bill only target China?
No, it also blocks equipment from Iran, Russia, and North Korea.
Bipartisan Bill Seeks to Block Chinese Chipmaking Equipment: Lithography Machines, Silicon Wafer Tools
The bill, introduced by Republican Jay Obernolte and Democrat Zoe Lofgren, targets a wide range of equipment, from advanced lithography machines, like those made by Dutch company ASML, to tools used to slice and dice silicon wafers, as per the Reuters report. While the bill is expected in the Senate in December, which will be introduced by Democrat Mark Kelly and Republican Marsha Blackburn, as per the report.ALSO READ: US farmers bag $16 billion rescue deal as wildfires and floods trigger emergency aid - here's how to enrol
CHIPS Act Overview: $39 Billion to Boost US Chip Manufacturing
The CHIPS Act, passed in 2022 under the Biden administration, was created to boost domestic chip production, as per the report. The law provided $39 billion to support the construction of new factories and expansion of existing facilities, with companies such as Intel, TSMC, and Samsung Electronics receiving grants, as per the Reuters report. In Intel’s case, some grant money was later converted into an equity stake by the US government, as per the report.China’s $40 Billion Investment in Chipmaking Equipment
China has invested more than $40 billion in its chip industry, focusing heavily on manufacturing equipment, and its share of the global market has grown significantly, according to background materials provided by lawmakers, reported Reuters.ALSO READ: Millions switching jobs — here’s the trick to make sure your retirement money follows you
Concerns From US Chip Equipment Makers
US chip equipment makers, including Applied Materials, Lam Research, and KLA, have raised concerns that export restrictions to China could reduce sales and limit research and development, as per the report. The use of CHIPS Act grant funds to purchase Chinese equipment has added to those concerns, according to Reuters.Bill Also Blocks Equipment From Iran, Russia, and North Korea
The bill also blocks tools from other countries of concern, including Iran, Russia, and North Korea, as per the report. However, it allows for waivers if certain equipment is not available from US or allied manufacturers, as per Reuters.Waivers Possible if US or Allied Equipment Is Unavailable
However, the restrictions would only apply to equipment brought into the US by CHIPS Act grant recipients and would not affect their operations overseas, as per the Reuters report.FAQs
Which companies have received CHIPS Act grants?Companies include Intel, TSMC, and Samsung Electronics, with Intel’s grant partially converted into a US government equity stake.
Does the bill only target China?
No, it also blocks equipment from Iran, Russia, and North Korea.
