TSMC talking to US about Chips Act ‘guidance’ amid subsidy concerns

TAIWANESE chipmaker TSMC said on Monday (Apr 10) it is communicating with Washington about its “guidance” for a law designed to boost US semiconductor manufacturing that has sparked concerns about subsidy criteria.

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, the world’s leading contract chipmaker, said in a short emailed statement.

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 (TSMC) is investing US$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 US$52 billion pool of research and manufacturing funds earmarked under the Chips Act.

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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