The Council and the European Parliament reach provisional agreement on the Chips Act!

18 Apr 2023

The Council and the European Parliament have reached on 18 April 2023 a provisional political agreement on the regulation to strengthen Europe’s semiconductor ecosystem, better known as the ‘Chips Act’.

The deal is expected to create the conditions for the development of an industrial base that can double the EU’s global market share in semiconductors from 10% to at least 20% by 2030.

“This agreement is of utmost importance for the green and digital transition while securing the EU’s resilience in turbulent times. The new rules represent a real revolution for Europe in the key sector of semiconductors. A swift implementation of today’s agreement will transform; our dependency into market leadership; our vulnerability into sovereignty; our expenditure into investment. The Chips act puts Europe in the first line of cutting-edge technologies which are essential for our green and digital transitions,” says Ebba Busch, Swedish Minister for Energy, Business and Industry and Deputy Prime Minister.

In a today tweet,Thierry Breton, Commissioner for Internal Market of the EU added ” In a geopolitical context of de-risking, Europe is taking its destiny into its own hands. By mastering the most advanced semiconductors, EU will become an industrial powerhouse in markets of the future”.

Main elements of the compromise on pillar one

As part of this provisional agreement, the Chips for Europe Initiative will mobilise €3,3 billion coming from the EU budget. These actions will be primarily implemented through a Chips Joint Undertaking, a public-private partnership involving the Union, the member states and the private sector.

The compromise reached today reinforces the competences of the Chips Joint Undertaking which will be responsible for the selection of the centres of excellence, as part of its work programme.

The compromise also underlines, the importance of international cooperation and the protection of intellectual property rights as two key elements for the creation of an ecosystem for semiconductors.

Next steps

The provisional agreement reached today between the Council and the European Parliament needs to be finalised, endorsed, and formally adopted by both institutions.

Once the Chips Act is adopted, the Council will pass an amendment of the Single Basic Act (SBA) for institutionalised partnerships under Horizon Europe, to allow the establishment of the Chips Joint Undertaking, which builds upon and renames the existing Key Digital Technologies Joint Undertaking. The SBA amendment is adopted by the Council following consultation of the Parliament.