The Defense Department June 28 published an unclassified list of entities that qualify as Chinese military companies. DOD is required to publish a list annually through 2030 under the 2021 National Defense Authorization Act. President Joe Biden recently expanded a Trump-era policy that banned investments in Chinese military companies (see 2106030067). The State Department listed the following entities:
A bipartisan group of lawmakers on the Senate Finance Committee introduced a bill last week they say will strengthen semiconductor supply chains by incentivizing more domestic manufacturing. The Facilitating American-Built Semiconductors (FABS) Act, like several similar bills proposed in recent months (see 2106100028), would introduce investment tax credits for investments in semiconductor manufacturing and other incentives for the semiconductor industry, the senators said June 17. An emphasis would be placed on manufacturing of “specialized tooling equipment” required in the semiconductor manufacturing process. Committee Chair Ron Wyden, D-Ore., and top Republican Mike Crapo, R-Idaho, introduced the bill with four other committee members as co-sponsors.
The U.S. and the European Union agreed this week to establish a U.S.-EU Trade and Technology Council, which will feature working groups on emerging technologies, export controls, investment screening and securing semiconductor supply chains, the White House said June 15. The European Commission said the council will meet “periodically” at the political level and will be chaired by EU trade officials along with U.S. Secretary of State Antony Blinken, Commerce Secretary Gina Raimondo and U.S. Trade Representative Katherine Tai. The working groups will “operationalise the political decisions into deliverables” and report to the political level, the commission said.
A Chinese private equity fund manager must obtain approval from the Committee on Foreign Investment in the U.S. before completing its transaction with a South Korean semiconductor company, a June 4 Securities and Exchange Commission filing said. Beijing-based Wise Road Capital and South Korea-based Magnachip Semiconductor, which has offices in the U.S., were told by CFIUS last month to submit a “notice concerning” Wise Road's buy of Magnachip, Magnachip said, which is now “conditioned on the receipt of CFIUS approval.” The two companies plan to file a joint voluntary notice, and Magnachip said it expects the deal's timeline to be delayed. Magnachip added that it doesn’t believe the transaction “will require any approval” in South Korea but plans to cooperate with the South Korean government if it has questions.
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The semiconductor industry urged U.S. and European leaders to cooperate more closely on technology and trade, ahead of a meeting this week between U.S. officials and the European Commission. The two sides should “build on their shared strategic interests and advance regulatory cooperation” to strengthen supply chains, Semi, a semiconductor manufacturing industry group, said June 14. Semi said it wrote letters last week to European Commissioner Thierry Breton, European Commission President Ursula von der Leyen and President Joe Biden to ask the European Union and the U.S. to form a trade and technology council. The council would ensure “cooperation on critical technologies and supply chains” to reflect “the needs of both partners and our globally integrated microelectronics industry.”
The Commerce Department published its spring 2021 regulatory agenda for the Bureau of Industry and Security, including two new mentions of emerging technology rules and new export controls on certain camera systems.
The Senate voted 68-32 this week to approve a comprehensive China package that would authorize a host of measures to address trade and technology competition issues with China. The U.S Innovation and Competition Act of 2021 has provisions from both the Strategic Competition Act (see 2104210038) and the Endless Frontier Act (see 2105130025), including measures that would incentivize more domestic semiconductor manufacturing and research. President Joe Biden said June 8 that he looks forward to working with the House to pass the legislation and that he hopes to sign “it into law as soon as possible.”
Semiconductors are a major plank of the broad supply chain vulnerability report released by the White House, and the report tries to grapple with the fact that major U.S. manufacturers are reliant on exports to China and that the U.S. and its allies want to maintain a technology edge over Chinese chip manufacturers.
A Japanese and a Korean economist said that trade tensions between their two countries are no longer really disrupting Korea's semiconductor industry, though they are still increasing costs for some of the Japanese exporters.