European Chip Sector Questions Export Restrictions Due to National Security

EU should think carefully before tightening export controls on chips and the equipment for their production, stated the semiconductor industry association, warning that such measures should be reserved only for cases of ‘genuine’ national security concerns.

In January, the European Commission outlined plans aimed at enhancing ‘economic security’ and preventing unwanted technology transfer to competitors like China. The EU rightly assessed the need to analyze the risk of competitors acquiring European technologies, but the best solution for safeguarding security ‘in scenarios of geopolitical crisis’ is a free trade partnership, claims the semiconductor industry association.

The association represents companies from across the semiconductor sector, including Dutch semiconductor manufacturing equipment producer ASML, German and Dutch chip manufacturers Infineon and NXP, and Belgian, German, and French research institutes Imec, Frauenhofer, and CEA Leti.

– To ensure the long-term success and prosperity of the European semiconductor industry, our companies must be as free as possible in their investment decisions – believe SEMI Europe, explaining that ‘otherwise they could lose agility and relevance’.

The Commission’s plans include aligning export restrictions, stricter scrutiny of foreign investments, and analyzing potential risks in European companies’ investments abroad. SEMI Europe believes that strict scrutiny of foreign investments could discourage companies and ‘undermine the potential success of the European Chips Act’. The Commission is attempting to support the domestic industry with this legislation and compete with similar programs in China and the US.

Washington seeks to disrupt China’s efforts to develop its own chip industry and is asking European partners to follow its lead. The Dutch government has already prohibited its domestic producer ASML from exporting machines for the production of sophisticated chips to China.

– In the context of current geopolitical tensions and the prominent role of semiconductor export control in these tensions, it is increasingly important for the EU to be united – emphasizes the association.

– Export control should actually be the last option, reserved for cases where there is genuine concern for national security – believes SEMI Europe.