December 7, 2023


The EU’s Chips Act finally entered into force yesterday (September 21), after spending over a year winding its way through the legislature. The landmark law is designed to bolster the bloc’s domestic supply, sovereignty, and competitiveness in the semiconductor sector.

Semiconductor chips are the backbone of all electronic products — and as such, theyr’e fundamental components in everything from smartphones and cars to applications in healthcare, clean energy, and communications. This means chips are also at the centre of geopolitical interests and the global rally for technological supremacy.

“The global race for leadership in chips is a fact and Europe must secure her active part in it,” said Věra Jourová, the Commission’s VP for Values and Transparency. “In the EU we have great talent and research, but we are missing out in linking those advantages with production and rollout of the technology.”

Meanwhile, shortages and frictions in the semiconductor supply chain (especially heightened during the pandemic), exposed the bloc’s heavy reliance on a few foreign suppliers — China and Taiwan for manufacturing, and the US for design.

Europe's market share in chip production by sector