Activist countries

Some EU countries want a billion-euro chip plan to fund current chips as well

By Foo Yun Chee

BRUSSELS (Reuters) – Some EU countries want the bloc’s billion-euro chip plan to fund the production of current cutting-edge chips and not just the first such chips proposed by the European Commission, according to a EU document seen by Reuters.

Unveiled this year, the Commission’s European Chips Act aims to strengthen the European Union’s chips industry and reduce its dependence on US and Asian supplies, triggered by global shortages and bottlenecks supply chain bottleneck.

The EU executive, however, said the 45 billion euro ($43.7 billion) plan only allows state funding for “first of its kind” European production facilities. The proposal must be discussed with EU countries and lawmakers before becoming law.

EU diplomats say some countries, however, want state aid to manufacture existing advanced chips used by their automakers.

The Czech Republic, which currently holds the rotating presidency of the European Union, has offered a compromise that could apply to a wider range of government-subsidized chips, according to the document.

The document indicates that the criteria for a “first of its kind” installation could include innovation to improve computing power or the level of security, safety or reliability, or even energy and environmental performance.

EU ambassadors could agree on a common position in early December, allowing them to start negotiations with EU lawmakers to finalize the legislation.

($1 = 1.0290 euros)

(Reporting by Foo Yun Chee; Editing by David Gregorio)