Industry Advocates Pragmatic EU Chips Act 2.0 to Close Semiconductor Gap with US and China

AMSTERDAM, November 18, 2025 – SEMI Europe, the trade group representing hundreds of European semiconductor firms, has called on the European Union to implement pragmatic reforms under a revised Chips Act 2.0, aiming to boost Europe’s competitiveness in semiconductor manufacturing and secure critical supply chains amid intensifying global competition.

The EU’s original 2023 Chips Act targeted 43 billion euros of investment into chip facilities, but SEMI Europe stresses that revisions are needed to ensure Europe does not fall behind global rivals such as the U.S., China, South Korea, Taiwan, and Japan, all of which have launched similar initiatives to secure chip supply chains in the rapidly expanding AI and high-tech sectors.

Key Recommendations by SEMI Europe

1. Focus on Strategic Investments:
   SEMI recommends shifting investment priorities from merely attracting advanced manufacturing projects to supporting European supply chains and leveraging existing strengths, particularly in chip equipment manufacturing, where companies such as ASML (Netherlands) lead globally.
2. Easing State Aid Criteria:
   The trade group suggests abandoning the strict “first of a kind” requirement for state aid eligibility, enabling more companies to access funding for projects that strengthen Europe’s chip ecosystem.
3. Streamlined Approvals:
   To accelerate project implementation, SEMI urges the EU to designate a single point of contact for firms and governments and commit to public timelines for project approvals, ensuring faster decision-making and reducing bureaucratic delays.
4. Increased Funding:
   SEMI proposes a budget of 20 billion euros ($23 billion) for semiconductor projects, representing a quadrupling of EU investment, alongside existing tax incentives and funding from member states.

Context and Strategic Importance

The proposed Chips Act 2.0 is set to be finalized ahead of schedule, in March 2026, under pressure from governments led by the Netherlands. European officials emphasize the importance of treating the semiconductor sector as a strategic industry, akin to aerospace and defense, and using all available instruments to protect and strengthen it.

SEMI Europe cautioned that past efforts, such as attempts to bring Intel advanced manufacturing to Germany, were less successful, highlighting the need for targeted, pragmatic investments that reinforce Europe’s core competencies.

As global demand for AI hardware and semiconductors accelerates, the EU aims to ensure technology sovereignty, secure critical supply chains, and maintain a competitive position in the international semiconductor market, while avoiding over-reliance on U.S. or Asian suppliers.

---

Key Takeaways

• SEMI Europe urges the EU to adopt a pragmatic Chips Act 2.0 to strengthen semiconductor supply chains.
• Recommendations include targeted investments, eased state aid criteria, and streamlined project approvals.
• Proposal includes a 20 billion euro EU budget for semiconductor projects, quadrupling current funding.
• European semiconductor sector is seen as strategically critical, comparable to aerospace and defense.
• Goal is to maintain global competitiveness against the U.S., China, South Korea, Taiwan, and Japan.