US Department of Commerce to Support 10% Investment for Semiconductor Material and Equipment Manufacturing Facilities Under $300 Million

The U.S. government has announced plans to provide incentives amounting to 10% of the investment for semiconductor materials and equipment manufacturing facilities with investments under $300 million.

According to the Ministry of Trade, Industry and Energy, on the 29th, the U.S. Department of Commerce announced the detailed support plan (NOFO) for incentives related to investments in semiconductor materials and equipment manufacturing facilities under $300 million as part of the semiconductor law incentive program at 6 p.m. (Korean time).

Under the semiconductor law, the financial incentives operated by the U.S. Department of Commerce consist of support for ▲ semiconductor manufacturing facilities ▲ semiconductor materials and equipment manufacturing facilities ▲ research and development (R&D) facility investments. This announcement is the third detailed support plan following the previous announcements for ▲ semiconductor manufacturing facilities ▲ wafer manufacturing facilities and materials and equipment manufacturing facilities investments over $300 million. The plan for R&D facility investments will be announced later.

The U.S. Department of Commerce issued this announcement as a separate document from the existing detailed support plans. Considering that it targets small-scale investments, some of the previously announced support criteria and procedures have been somewhat relaxed or modified. Accordingly, loans (guarantees) are excluded, and support is provided through direct subsidies, with the support amount generally being 10% of the investment, except for some exceptions.

Regarding requirements, the U.S. Department of Commerce emphasized strengthening the supply chain through linkage with semiconductor manufacturing equipment, while excluding conditions such as excess profit sharing and obligations to provide childcare services. The application procedure has also changed; applicant companies submit a plan, and based on this plan, companies selected by the Department of Commerce proceed with a separate formal application.

However, according to the final detailed guardrail regulations announced on the 22nd, investments in materials and equipment manufacturing facilities are not subject to restrictions on facility expansion in China.

Our industry intends to conduct a detailed review and response to the U.S. Department of Commerce’s incentive program based on this announcement. The government also plans to closely discuss the impact of this announcement on the industry and cooperate with the U.S. government to support smooth investment and business activities of our companies.

Researchers are conducting semiconductor material and component development research in the 12-inch semiconductor testbed cleanroom at the Daejeon Nano Convergence Technology Institute. It is forecasted that the global semiconductor shortage will continue until mid-next year. As the local industry in the region, which is implementing strategies to advance the semiconductor ecosystem, faces potential impacts from this trend, attention is focused on the situation, while various countries around the world are also rolling out their countermeasures. Our government is accelerating efforts to advance the semiconductor ecosystem. Through the 'K-Semiconductor Strategy Report,' the government envisions a leap to becoming a comprehensive semiconductor powerhouse by 2030, aiming to complete semiconductor localization through massive investments and tax benefits. Having achieved K-quarantine through COVID-19, South Korea is expected to proudly demonstrate the success of K-Semiconductor in the global semiconductor dominance competition. /Daejeon=Photo by Kang Jin-hyung aymsdream@

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