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Computer chip group SEMI tells EU: any export limits should be 'last resort'

Semiconductor chips are visible on a printed circuit board in this illustration photo taken February 17, 2023

AMSTERDAM, March 5 (mod1s) - The European Union should think carefully before implementing more export restrictions or regulations on foreign investment, semiconductor industry organization SEMI Europe warned in a position paper issued this week.

The warning comes after the European Commission in January announced a package of policies aimed at enhancing "economic security" and avoiding unwanted technology transfers to competitors such as China.

While the EU is appropriate to assess concerns that its competitors may gain European technology, SEMI Europe stated open trade alliances were the best approach to protect security "in geopolitical crisis scenarios".

"In order to guarantee the long term success and prosperity of the European semiconductor industry, our companies must be as free as possible in their investment decisions or otherwise risk losing their agility and relevance," the group added.

European Commission measures include harmonization of export restrictions, better screening of inward investment, and a review into whether investments by European businesses overseas may potentially constitute a danger.

"We felt that it was the right time to respond" SEMI Europe spokesperson Stefano Orlando said on Tuesday.

The group represents companies from across the European chip industry including ASML (ASML.AS), opens new tab, NXP(NXPI.O), opens new tab, Infineon (IFXGn.DE), opens new tab and STMicroelectronics (STMPA.PA), opens new tab, as well as leading research laboratories Imec of Belgium, Fraunhofer of Germany and CEA Leti of France.

SEMI cautioned that heavy-handed monitoring of inward investments might dissuade firms and "undermine the potential success of the European Chips Act" - the bloc's effort to duplicate governmental backing for the chip sector in response to comparable initiatives in China and the United States.

Intel (INTC.O), opens new tab and Taiwan's TSMC (2330.TW), opens new tab have declared ambitions to develop new semiconductor factories in Europe, although neither have yet been given subsidies.

Following a campaign by the U.S. government aimed at crippling China's capacity to make its own sophisticated computer chips, the Dutch government has barred ASML, Europe's biggest tech corporation, from selling many of its goods to China.

"In light of the recent geopolitical tensions, and the prominent role that export controls in the semiconductor industry have played in this, it has become increasingly necessary for the EU to speak with a common voice," SEMI stated.

"Export controls should indeed be a last resort for cases with genuine concerns for national security."

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