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TSMC Seeks Clarity From US Amid Chips Act Subsidy Concerns

Industry sources say TSMC and other chipmakers fear the US Chips Act subsidy process could expose confidential corporate strategy


Industry sources say TSMC and other firms fear the US Chips Act subsidy process could expose confidential corporate strategy
TSMC founder Maurice Chang, centre, is seen with colleagues in front of the chipmaker's logo in Taiwan. Reuters file photo.

 

Taiwanese chipmaker TSMC said on Monday it is talking with Washington about subsidies introduced by the Biden Administration under the Chips Act.

TSMC – the world’s leading contract chipmaker – wants to clarify “guidance” notes issued by the White House about the law, which aims to boost semiconductor manufacturing in the United States, amid concerns about its criteria for subsidies.

Conditions for subsidies include sharing excess profit with the US government, and industry sources have said the application process itself could expose confidential corporate strategy.

“We can confirm that we are communicating with the US government about the CHIPS Act guidance,” TSMC said in a short emailed statement.

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Korean tech firms ‘worried’

South Korean President Yoon Suk Yeol also said last month that the criteria are worrying companies like Samsung Electronics and SK Hynix.

Taiwan Economy Minister Wang Mei-hua told reporters on Monday that TSMC was specifically talking to the United States about the details of the subsidies.

“The Taiwan government and industry have a very close understanding (of what is going on) and hope that the details of the relevant subsidy legislation will not affect industrial cooperation between the two sides and costs for industry-related construction,” she said.

Taiwan Semiconductor Manufacturing Co Ltd (TSMC) is investing $40 billion in a new plant in the western US state of Arizona, supporting Washington’s plans for more chip-making at home.

Details of expected subsidies for the plant have not been disclosed.

The subsidies would come from a $52 billion pool of research and manufacturing funds earmarked under the CHIPS Act.

The US Department of Commerce said last month it will protect confidential business information and expects that the requirement to share excess profit will only occur when projects significantly exceed projected cash flow.

 

  • Reuters with additional editing by Jim Pollard

 

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US Would ‘Destroy Taiwan Chip Factories if China Invaded’ – BI

 

High Cost, ‘Unmanageable’ US Staff Plague TSMC in Arizona – NYT

 

 

Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years.