Some EU countries want billion-euro chip plan to also fund current chips

Some EU countries want the bloc’s billion-euro chip plan to fund the production of current cutting edge chips and not just first-of-its kind chips proposed by the European Commission, according to an EU document seen by Reuters.

Unveiled this year, the Commission’s European Chips Act aims to reinforce the European Union’s chip industry and reduce its dependence on US and Asian supply, triggered by the global shortage and supply chain bottlenecks.

The EU executive however said the 45-billion-euro ($43.7 billion) plan allows state funding only for European “first-of-a-kind” production facilities. The proposal needs to be thrashed out with EU countries and lawmakers before it can become law.

EU diplomats say some countries however want state aid for making existing leading edge chips used by their carmakers.

The Czech Republic, which currently holds the European Union’s rotating presidency, has come up with a compromise that could apply to a broader range of chips subsidised by governments, according to the document.

The document says the criteria for “first-of-a-kind” facility could include innovation to improve computing power or the level of security, safety or reliability, or in energy and environmental performance.

EU ambassadors may agree on a common position in early December, allowing them to kick off negotiations with EU lawmakers to finalise legislation.

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