Kelly, Colleagues Introduce Bipartisan, Bicameral Bill to Reinforce U.S. Microchip Manufacturing Edge Against China and Protect National Security
Today, Senator Mark Kelly (D-AZ) and Senator Marsha Blackburn (R-TN), along with Representative Frank Lucas (R-OK-3) and Representative Zoe Lofgren (D-CA-18)—Chairman and Ranking Member of the House Committee on Science, Space, and Technology, respectively—introduced the Chip Equipment Quality, Usefulness, and Integrity Protection Act of 2024(Chip EQUIP Act),bipartisan and bicameral legislation to prevent companies that receive CHIPS and Science Act funding from purchasing specialized manufacturing tools or equipment made by entities owned or controlled by the Chinese government, or other foreign entities of concern.
China currently trails the U.S. in the manufacturing of advanced semiconductor tools, but it has engaged in a sustained effort to invest in developing their own advanced tools and to scale up their production capability of “legacy” tools, which are not affected by export controls, like the one the U.S. imposed in 2022. If left unchecked, Chinese state subsidies and aggressive market tactics could lead Chinese-made legacy tools to be placed in manufacturing facilities in the U.S. and allied nations in the future.
“As the United States revitalizes its domestic semiconductor manufacturing industry, we must do everything in our power to stop China and other foreign entities of concern from compromising our microchip manufacturing facilities,” said Senator Kelly, a chief negotiator of the Chips and Science Act. “The Chip EQUIP Act will strengthen our national security and ensure that America’s advanced semiconductor tools remain the world’s best.”
“American taxpayer dollars should not be used to purchase Communist Chinese semiconductor manufacturing equipment when the same tools are made in America,” said Senator Blackburn. “The Chip EQUIP Act is essential to ensuring that semiconductor manufacturing tools are not made or controlled by the New Axis of Evil — Communist China, Russia, North Korea, and Iran.”
“Having a strong domestic semiconductor industry is critical to our economic success and our national security. The Chinese Communist Party has a stranglehold on these markets, and it’s imperative that we catch up. The Chip EQUIP Act picks up where CHIPS and Science left off, and prohibits CHIPS-funded projects from buying Chinese semiconductor manufacturing equipment and tooling. It will strengthen our competitiveness, protect us from intellectual property theft, and ensure taxpayer dollars are being used effectively. I’m proud to join Senator Kelly, Senator Blackburn, and Ranking Member Lofgren on this important legislation,” said Chairman Lucas.
“The CHIPS and Science Act made historic investments to surge production of American-made semiconductors and address the supply chain vulnerabilities created by decades of offshoring in the semiconductor industry,” said Ranking Member Lofgren. “Other nations have taken note of these investments and are ramping up their own domestic capacity. While the Biden-Harris Administration has taken needed steps to further strengthen the controls on our semiconductor supply chain and protect U.S. competitiveness in this critical industry, we must continue to be vigilant to stay one step ahead of our adversaries like China. This common-sense bill will help protect CHIPS investments and ensure they are not used to support our adversaries’ capacity to develop semiconductor manufacturing equipment.”
Background:
Today, nearly all the specialized tools and equipment used throughout the semiconductor manufacturing supply chain are made in the U.S. or allied nations like Japan and the Netherlands. However, demand is surging for Chinese-made semiconductor tools and the PRC has announced that its new $40 billion investment in its own semiconductor industry will heavily focus on chip manufacturing equipment. In April, Huawei announced it was investing in new R&D capabilities to rival that of U.S., Japanese, and Dutch firms.
This legislation will amend the CHIPS and Science Act to clarify that if a company takes funding from this law, projects using such funding can’t purchase specialized semiconductor manufacturing tools made by entities owned or controlled by adversaries such as China, Russia, North Korea, and Iran.
Click here to read the bill text.
