Chip EQUIP Act

Summary#

This bill, the Chip EQUIP Act, would bar covered recipients of certain federal financial assistance from purchasing "completed, fully assembled" semiconductor manufacturing equipment made, assembled, or refurbished by a “foreign entity of concern” or its subsidiary. The bill adds definitions for "completed, fully assembled" equipment and for "ineligible semiconductor manufacturing equipment" and lists types of equipment covered, including deposition, etching, lithography, inspection and test gear, wafer slicing and dicing, wire bonders, ion implantation, chemical mechanical polishing, diffusion/oxidation furnaces, thermal processing, and automated material handling systems. It would require award agreements under specified sections of the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021 to include these prohibitions for 10 years from the agreement date. The Secretary may grant a waiver when (A) equivalent equipment is not available from the United States or allied/partner countries in sufficient quantity or quality, (B) the item was originally manufactured by a non-foreign entity but later refurbished by a foreign entity of concern, or (C) the use complies with the Export Administration Regulations and the Secretary, after consulting the Director of National Intelligence or the Secretary of Defense, determines the waiver is in the national security interest. The bill also states that nothing in this waiver provision may be read to waive the application of section 9907. Sponsors listed are Senators Mark Kelly, Marsha Blackburn, and Tim Sheehy.

What it means for you#

• If you are a company, university, or other entity receiving federal financial assistance under the referenced programs, your award agreements will include a 10-year prohibition on buying certain finished semiconductor manufacturing tools from foreign entities of concern unless a waiver is granted under the conditions in the bill.
• If you make or sell the kinds of equipment listed and are or work with an entity designated a foreign entity of concern, covered purchasers who receive these awards could be prohibited from buying your finished machines.
• The rule applies to completed, ready-to-use or ready-to-install equipment. It does not prohibit buying individual parts, chambers, subsystems, or subcomponents as defined in the bill.

Expenses#

No publicly available information on cost estimates or federal budgetary effects is included in the bill text or provided metadata.

Proponents' View#

No publicly available information.

Opponents' View#

No publicly available information.