EU Canvasses Semiconductor Industry Over China’s 'Legacy Chip' Expansion

The European Commission is gathering feedback from the semiconductor industry about China's increased production of older generation chips. This follows the Commission's steps to address supply chain dependencies. Tensions escalate as the EU imposes tariffs on Chinese electric vehicles, and the Commission prepares for industry surveys in September.

The European Commission is actively seeking input from the semiconductor industry regarding China's increased production of older generation computer chips, according to two sources closely associated with the matter. The move forms part of a broader strategy to address potential supply chain dependencies and distortionary effects within the chip industry.

A Commission spokesperson confirmed on Friday that they had launched a 'targeted consultation with the industry' to better understand the use of legacy chips in supply chains. The EU and the US are reportedly considering joint measures to mitigate these dependencies.

This development comes amidst increasing tensions between Brussels and Beijing, as the EU imposes provisional tariffs of up to 37.6% on Chinese electric vehicles. These tariffs may signal the beginning of a tougher EU stance towards China's competitive strategies, which include state-subsidized expansion of legacy chip production in response to U.S.-led restrictions on advanced chip technologies.

(Disclaimer: With inputs from agencies.)