The Trump administration reportedly considered renegotiating the CHIPS Act incentives.
The Trump administration is seeking to restructure certain agreements under the CHIPS Act, which aims to increase semiconductor production.
The recipients of awards granted under the CHIPS and Science Act by the U.S. government may not receive the amounts that were initially promised. Recent reports suggest that the Trump administration is seeking to assess and modify the current requirements of the CHIPS Act. This could lead to renegotiation of some agreements established by the Biden administration, in addition to indicating a possible delay in pre-scheduled disbursements.
A spokesperson for GlobalWafers, a Taiwan-based company and one of the program's beneficiaries, indicated that it received notification that the policies of the CHIPS Act are under review, as certain conditions do not align with Trump's executive orders. GlobalWafers was set to receive $406 million in grants.
The CHIPS Act was enacted in 2022 by former President Joe Biden to boost semiconductor production in the United States. Each beneficiary has specific milestones that must be met to access the grants, with the goal of encouraging the construction of new foundries and the modernization of existing ones in the country.
The Trump administration has expressed concerns about many of the requirements established by the previous administration, which includes clauses added to contracts, such as the obligation to use union labor in the construction of factories and to provide affordable childcare for workers’ children. Additionally, the White House is also displeased with expansion announcements in China made by some companies, such as Intel, after being selected as beneficiaries.
So far, the U.S. government has not formally announced any changes to the policies of the CHIPS Act, leaving the extent of these adjustments and their potential impact on previous agreements uncertain. Bloomberg reports last year indicated that the Biden administration rushed to finalize agreements with beneficiaries following Donald Trump's electoral victory, who has openly criticized the program, labeling it as "bad" and arguing that raising tariffs could attract chip companies without the need for grants.
