South Korea and US Agree to Minimize Uncertainty for IRA and Semiconductor-Related Companies

Minimizing Supply Chain Disruptions
Strengthening Semiconductor and New Industry Cooperation

Ministers from South Korea and the United States agreed to minimize corporate uncertainties and management burdens during the implementation of the Semiconductor Act and export controls, and to continue consultations.

On the afternoon of the 27th (local time), Lee Chang-yang, Minister of Trade, Industry and Energy, held the '1st Korea-US Supply Chain Industry Dialogue (SCCD)' with US Secretary of Commerce Gina Raimondo during President Yoon Suk-yeol's state visit to the United States, announcing this through a joint declaration. The Korea-US Supply Chain Industry Dialogue is an advanced industry and supply chain cooperation channel agreed upon between the Korean Minister of Trade, Industry and Energy and the US Secretary of Commerce.

At the meeting, following the close consultations on the US Semiconductor Act and the Inflation Reduction Act (IRA) at the Korea-US summit on the 26th, these issues were intensively discussed.

Resolving IRA Issues and Operating Predictable Export Control Measures

Minister Lee pointed out that uncertainties related to guardrails still remain and that Korean companies face significant difficulties in global business operations. He also noted that uncertainties persist for Korean companies regarding excessive corporate information disclosure and excess profit recovery related to the detailed requirements (NOFO) for semiconductor subsidies, urging active attention and cooperation from the US Department of Commerce to reasonably resolve these issues.

Regarding export controls, both countries agreed to discuss ways to operate export control measures more predictably to minimize disruptions to the global semiconductor supply chain and maintain the sustainability and technological advancement of the semiconductor industry even after the expiration of the one-year general license for Korean semiconductor companies in China.

Additionally, they promised to establish a public-private semiconductor cooperation forum to strengthen semiconductor industry cooperation between Korea and the US, promoting research and development (R&D), technology demonstration, and personnel exchanges in next-generation semiconductors, advanced packaging, and advanced materials and components sectors.

Minister Lee also agreed to closely consult for the smooth resolution of IRA issues such as Foreign Entities of Concern (FEOC) and requested active efforts to alleviate difficulties faced by Korean companies regarding issues like Section 232 on steel and visa issuance.

Regarding cooperation in advanced industries such as semiconductors, both countries will expand participation in the existing Korea-US Supply Chain Industry Dialogue (SCCD) by establishing a public-private semiconductor cooperation forum including companies, universities, and research institutes from both countries. Through this forum, they will explore cooperation plans from the establishment stage between the US National Semiconductor Technology Center (NSTC) and the Korean Advanced Semiconductor Technology Center (tentative name ASTC), which are currently being established.

They also agreed to jointly promote R&D, technology demonstration, and personnel exchanges in advanced semiconductor technology fields such as next-generation semiconductors, advanced packaging, and advanced materials and components.

They agreed to strengthen cooperation in new industry fields such as robotics and 3D printing. A showcase of companies from both countries will be held within the year, and they will cooperate in areas such as international standards and certification to advance technology in these fields.

Minister Lee requested US cooperation to promptly resolve difficulties faced by Korean companies regarding the IRA, Section 232 on steel, and visa issuance. Specifically, regarding the IRA, he requested ▲ the establishment of guidance for Foreign Entities of Concern (FEOC), ▲ prioritizing Korean companies when applying investment tax credits, and ▲ expanding the list of core mineral FTA countries.

Immediately after the meeting, three MOUs in the electric vehicle sector were also signed. The Korea Institute for Advancement of Technology (KIAT) signed MOUs on semiconductor industry and supply chain technology cooperation with NY Creates, a leading semiconductor research institution in the New York area, and BRIDG, an institution established to support the semiconductor and AI industries in Florida. The Korea Testing Certification (KTC) signed a cooperation MOU with UL Solutions, a global leading testing and certification organization in safety and security, regarding testing and certification of electric vehicle chargers and batteries.

Minister Lee stated, “The Ministry of Trade, Industry and Energy will continue to consult with the US Department of Commerce to ensure that the difficulties of our companies are practically resolved and that Korea-US cooperation in advanced industries such as semiconductors can be elevated to the next level.”

Lee Chang-yang, Minister of Trade, Industry and Energy, attended the "Korea-US Supply Chain Industry Dialogue" held on the 27th (local time), where government delegations from both Korea and the US, including Gina Raimondo, US Secretary of Energy, were present, and took a commemorative photo.

This content was produced with the assistance of AI translation services.