Only some local chipmakers will qualify for U.S. subsidies

U.S. President Joe Biden, left, and SK Siltron CSS CEO Jianwei Dong, right, tour the SK Siltron CSS facility in Michigan, U.S., on Nov. 29, 2022. [REUTERS/YONHAP]

Only a few Korean chipmakers will be able to receive subsidies for chip materials and equipment facilities, according to the Ministry of Trade, Industry and Energy.

On Friday, the U.S. Commerce Department released guidelines for its chip manufacturing subsidy program for chipmakers who are investing more than $300 million into semiconductor materials and manufacturing equipment facilities.

It is part of the U.S. Chips and Science Act, which was passed in July, that offers $52.7 billion worth of subsidies and tax benefits for companies executing semiconductor-related investments in the country.

In February, general guidelines for the construction, expansion, or modernization of commercial chip fabrication facilities were announced.

Requirements announced for semiconductor materials and manufacturing equipment facilities remain largely the same, such as that chipmakers have to invest more than $1 billion to receive subsidies of more than $150 million, and they will also have to share excess profits with the U.S. government.

Companies that qualify for the subsidies must also offer childcare programs to construction workers and operators.

“However, unlike the requirements for commercial chip fabrication facilities, the subsidy size of which domestic companies can receive for chip materials and equipment facilities is known to be relatively small,” the Ministry of Trade, Industry and Energy said in a statement on Friday.

The U.S. Commerce Department added it will also consider how much the project alleviates the geographical concentration and bottlenecks in the semiconductor supply chain.

It also stated that they will assess whether the material and equipment facilities contribute to the establishment of a productive and self-sustaining semiconductor ecosystem and ultimately, to the economic security and innovation ecosystem of the U.S.

Pre-applications, which are optional, will be accepted from Sept. 1, and full applications will be accepted starting from Oct. 23.

Requirements for the establishment of smaller chip material and manufacturing equipment facilities, and chip research and development centers under $3 billion will be announced at a later date.

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]