Chip: A Historical Overview Of Its Legal Journey

On August 9, 2022, President Joe Biden signed the CHIPS and Science Act into law. The Act, which stands for Creating Helpful Incentives to Produce Semiconductors, was designed to boost US competitiveness, innovation, and national security. It allocated $280 billion to strengthen the semiconductor industry, with $52.7 billion going towards semiconductor research, manufacturing, and workforce development. The Act also included $39 billion in subsidies for chip manufacturing on US soil, with the aim of strengthening American supply chain resilience and countering China.

The CHIPS and Science Act was signed into law by President Joe Biden on 9 August 2022

On 9 August 2022, the CHIPS and Science Act was signed into law by President Joe Biden. The Act is a federal statute enacted by the 117th United States Congress, which authorizes approximately $280 billion in new funding to boost domestic research and manufacturing of semiconductors in the United States. The Act includes $52.7 billion for semiconductor research, manufacturing, and workforce development, with $39 billion in subsidies for chip manufacturing on U.S. soil, and $13 billion for semiconductor research and training. The Act also provides a 25% investment tax credit for manufacturing equipment, amounting to $24 billion.

The CHIPS and Science Act combines two bipartisan bills: the Endless Frontier Act, which aims to boost investment in domestic high-tech research, and the CHIPS for America Act, which seeks to bring semiconductor manufacturing back to the U.S. The Act is designed to strengthen American manufacturing, supply chains, and national security, while also investing in research and development, science and technology, and the workforce of the future. It is expected to create thousands of jobs and strengthen the United States' position in the global semiconductor supply chain.

The Act will also establish a technology, innovation, and partnerships directorate at the National Science Foundation (NSF) to focus on fields like semiconductors, advanced computing, advanced energy technologies, and quantum information technologies. It will catalyze regional economic growth and development by investing in regional innovation and technology hubs across the country, bringing together state and local governments, educational institutions, businesses, and community organizations.

The CHIPS and Science Act is a significant step towards revitalizing domestic chip production, reducing reliance on foreign suppliers, and enhancing national security. It addresses the challenges posed by the erosion of the U.S. share of modern semiconductor manufacturing capacity, which has declined from 37% in 1990 to 10% in 2022. The Act provides the necessary funding and incentives to boost domestic semiconductor manufacturing, design, and research, fortify the economy, and reinforce America's chip supply chains.

The Act includes $39 billion in subsidies for chip manufacturing on US soil

The CHIPS and Science Act was signed into law by President Joe Biden on August 9, 2022. The Act includes $39 billion in subsidies for chip manufacturing in the US, with the aim of strengthening American supply chain resilience and countering China. This is part of a larger $52.7 billion allocation for American semiconductor research, development, manufacturing, and workforce development. The Act also includes $13 billion for semiconductor research and workforce training, as well as a 25% investment tax credit for costs of manufacturing equipment.

The Act is expected to boost American semiconductor research, development, and production, ensuring US leadership in the technology that forms the foundation of everything from automobiles to household appliances to defense systems. It will also help to unlock hundreds of billions of dollars in additional private sector investment in the semiconductor industry.

The $39 billion in subsidies for chip manufacturing on US soil is intended to secure domestic supply, create tens of thousands of good-paying jobs, and catalyze further private investment. The Act requires recipients of the subsidies to demonstrate significant worker and community investments, including opportunities for small businesses and disadvantaged communities.

The Act also includes strong guardrails to ensure that recipients do not build certain facilities in China or other countries of concern, and to prevent companies from using taxpayer funds for stock buybacks or shareholder dividends. Additionally, the Act will support good-paying, union construction jobs by requiring prevailing wage rates for facilities built with CHIPS funding.

The CHIPS and Science Act is expected to have a significant impact on the semiconductor industry and the US economy, with companies announcing billions of dollars in additional investments in response to the Act. It remains to be seen how effectively the Act will achieve its goals, but it represents a significant effort by the Biden administration to strengthen the US position in the global semiconductor supply chain and enhance national security.

It also includes $52.7 billion for semiconductor research, manufacturing, and workforce development

The CHIPS and Science Act, signed into law by President Joe Biden on 9 August 2022, includes $52.7 billion for semiconductor research, manufacturing, and workforce development. This comprises $39 billion in manufacturing incentives, including $2 billion for legacy chips used in automobiles and defence systems, $13.2 billion for research and development and workforce development, and $500 million for international information communications technology security and semiconductor supply chain activities. The Act also provides a 25% investment tax credit for capital expenses for manufacturing semiconductors and related equipment.

The $52.7 billion allocation is part of a broader $280 billion investment in US semiconductor capacity, R&D, and the creation of regional high-tech hubs and a bigger, more inclusive STEM workforce. The Act is designed to boost US competitiveness, innovation, and national security, and to catalyse investments in domestic semiconductor manufacturing capacity. It also jump-starts R&D and commercialisation of leading-edge technologies, such as quantum computing, AI, clean energy, and nanotechnology.

The CHIPS and Science Act was created in response to the US's declining share of global semiconductor production. In the 1990s, the US manufactured 37% of the world's semiconductors, but by 2022, this had fallen to just 10%. The Act aims to revitalise domestic chip production, reduce reliance on foreign suppliers, and enhance national security. It is also intended to lower costs, create jobs, strengthen supply chains, and counter China.

The Act has been successful in attracting investment, with companies announcing nearly $50 billion in additional investments in American semiconductor manufacturing in the week following its passage. This brings total business investment in the industry to nearly $150 billion since President Biden took office. The Act is also expected to unlock hundreds of billions more in private sector investment across the country.

The $52.7 billion allocation for semiconductor research, manufacturing, and workforce development is intended to secure domestic supply, create tens of thousands of good-paying, union construction jobs, and catalyse further private investment. It will also support good-paying, union construction jobs by requiring Davis-Bacon prevailing wage rates for facilities built with CHIPS funding.

The Act is expected to create over 115,000 manufacturing and construction jobs across the US

The CHIPS and Science Act, signed into law by President Joe Biden in August 2022, is expected to create over 115,000 manufacturing and construction jobs across the US. The Act, which stands for "Creating Helpful Incentives to Produce Semiconductors", is designed to boost domestic research and manufacturing of semiconductors in the US. It authorises approximately $280 billion in new funding, with $52.7 billion appropriated for American semiconductor research, development, manufacturing, and workforce training.

The Act includes $39 billion in subsidies and tax credits for chip manufacturing in the US, as well as $13 billion for semiconductor research and workforce training. The aim is to strengthen American supply chain resilience and counter China's dominance in the industry. The Act also invests $174 billion in the public sector research ecosystem, advancing various fields such as quantum computing, biotechnology, and materials science.

The impact of the Act on job creation is already being felt, with the Commerce Department announcing over $30 billion in proposed CHIPS private sector investments spanning 15 states. These investments include 16 new semiconductor manufacturing facilities, which are expected to create over 115,000 jobs in manufacturing and construction. This will not only boost the economy but also help bring semiconductor manufacturing back to the US.

The Act has incentivised companies to invest in American semiconductor manufacturing, with total business investments reaching nearly $150 billion since President Biden took office. For example, Micron has announced a $40 billion investment in memory chip manufacturing, which is expected to create up to 40,000 new jobs. Additionally, Qualcomm and GlobalFoundries have formed a partnership to invest $4.2 billion in expanding chip manufacturing in New York.

The CHIPS and Science Act is a significant step towards strengthening American manufacturing, supply chains, and national security. It ensures that the US remains a leader in critical technologies and creates good-paying jobs for Americans. The Act's focus on regional innovation and technology hubs will also help spur economic development and create jobs in high-growth, high-wage sectors across the country.

The CHIPS Act directs $280 billion in spending over the next ten years

The CHIPS and Science Act, signed into law by President Joe Biden on 9 August 2022, directs $280 billion in spending over the next ten years. The Act is a US federal statute enacted by the 117th United States Congress, with the aim of boosting domestic research and manufacturing of semiconductors in the US. The Act includes $52.7 billion for semiconductor manufacturing, research, development, and workforce training, with $39 billion in subsidies for chip manufacturing on US soil and a 25% investment tax credit for manufacturing equipment. The Act also invests $174 billion in the public sector research ecosystem for science and technology, including quantum computing, materials science, and biotechnology.

The CHIPS Act directs $200 billion for scientific research and development, with a focus on emerging technologies such as quantum computing, nanotechnology, artificial intelligence, and clean energy. The Act also includes $24 billion in tax credits for chip production. Additionally, $3 billion is allocated for programs targeting leading-edge technology and wireless supply chains.

The Act establishes a National Semiconductor Technology Center, investing $2 billion to fund microelectronics research, fabrication, and workforce training for the Department of Defense. It also provides $500 million to the Department of State to coordinate with foreign governments on semiconductor supply chain security. The Act further invests in regional innovation and technology hubs, allocating $10 billion to bring together state and local governments, educational institutions, businesses, and community organizations to create regional partnerships and drive economic growth.

The CHIPS and Science Act is designed to strengthen American manufacturing, supply chains, and national security, while also promoting innovation, creating jobs, and supporting equitable economic growth and development. The Act aims to reduce reliance on foreign suppliers, particularly from East Asia, which currently accounts for 75% of global semiconductor production.

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