IN Brief:
- SEMI has issued nine policy recommendations as the European Chips Act 2.0 moves through the legislative process.
- It wants First-Of-A-Kind support to cover design, materials, equipment, manufacturing, and advanced packaging.
- Production costs, permitting, workforce capacity, governance, and supply-chain monitoring remain central parts of its proposal.
SEMI has issued nine recommendations for the proposed European Chips Act 2.0, calling for policy support to extend across semiconductor design, materials, equipment, manufacturing, and advanced packaging rather than concentrating mainly on wafer fabrication. The industry association is also seeking faster investment decisions, more predictable permitting, lower operating-cost disadvantages, stronger industry involvement in governance, and additional workforce measures.
The recommendations come as the European Commission’s proposed legislation enters the co-legislative process. SEMI says several elements in the draft already reflect priorities raised by its European membership, but argues that further changes are required if the framework is to sustain investment across the complete semiconductor ecosystem.
One of the principal proposals is to broaden the First-Of-A-Kind framework. SEMI wants eligibility to cover the full value chain, recognising that a new semiconductor fab remains dependent on design capability, manufacturing equipment, speciality materials, packaging, test, software, and engineering support.
That broader definition has practical consequences for manufacturing policy. Public support directed at wafer capacity alone can leave other bottlenecks untouched, particularly as advanced packaging, high-bandwidth memory, lithography, metrology, and specialised materials become larger contributors to device performance and production cost.
SEMI also wants investment and permitting procedures to become faster and more predictable. Semiconductor projects have unusually long planning and equipment cycles, while the technologies they are intended to manufacture can change rapidly. Delayed permitting or funding decisions can therefore leave a facility entering production against a different market or process-generation requirement from the one assumed when the project was approved.
The association’s proposals also address the recurring difference between capital support and long-term production economics. Grants or tax incentives may help finance a new plant, but electricity, labour, water treatment, chemicals, maintenance, logistics, regulatory compliance, and depreciation continue throughout the operating life of the facility.
SEMI describes Europe’s production-cost disadvantage as one area that Chips Act 2.0 still needs to address. That is especially relevant where manufacturers are deciding between regions that can all offer investment incentives but have materially different energy prices, labour pools, permitting regimes, infrastructure, and supplier density.
Governance forms another part of the position. SEMI wants stronger industry participation in Chips Act decision-making and an EU budget capable of supporting the programme without creating funding structures detached from actual semiconductor development cycles. Process technology, packaging methods, trade controls, and demand patterns can move more quickly than conventional policy timetables.
The organisation is also calling for secure, industry-led supply-chain monitoring. Governments want better visibility of critical semiconductor dependencies following shortages and trade disruption, but chip companies and equipment suppliers also hold commercially sensitive information about customers, inventories, capacity, and sourcing. SEMI’s formulation points towards a monitoring system developed with industry rather than a purely administrative reporting structure.
Skills remain the final constraint running through several of the recommendations. Semiconductor expansion requires process engineers, equipment technicians, materials specialists, packaging engineers, test staff, designers, software developers, and experienced fab operators. Adding buildings and tools without increasing that labour pool merely shifts the bottleneck.
Global semiconductor-equipment billings reached $40.53 billion in the second quarter of 2026, up 23% year-on-year and 11% sequentially. The record underlines the scale of the investment cycle in which Europe is competing, with advanced logic, memory, packaging, and AI-related capacity continuing to absorb manufacturing equipment.
Chips Act 2.0 will consequently operate against a market in which capital is already being committed rapidly elsewhere. SEMI’s nine recommendations concentrate on whether Europe can connect its existing research, equipment, materials, design, manufacturing, and packaging assets quickly enough to compete for those programmes, rather than assuming that another headline funding commitment will resolve the underlying industrial economics.
