Chip EQUIP Act

The Chip EQUIP Act would amend existing semiconductor funding law to restrict companies that receive federal financial assistance under the CHIPS Act from purchasing certain semiconductor manufacturing equipment. Specifically, companies could not use federal funding for projects that involve equipment manufactured or assembled by foreign entities of concern, including China, Russia, North Korea, and Iran, or their subsidiaries. These restrictions would apply for 10 years from when a company signs a funding agreement.

The bill would allow the Secretary of Commerce to grant exemptions in limited circumstances. Exemptions could be granted if the required equipment is not available in sufficient quality or quantity from the United States or allied countries, if equipment was originally made by an allied nation but later refurbished by a foreign entity of concern, or if using the equipment is deemed necessary for national security purposes. The legislation aims to ensure that U.S. government investments in semiconductor manufacturing do not indirectly support manufacturing equipment from countries considered national security concerns.