The European Union will announce proposals for new laws at the beginning of next month to stimulate chip production on its soil. Ursula von der Leyen, President of the European Commission, announced this online.

The EU wants to play a more significant role in global chip production. The goal is to have a 20% market share in chip production by 2030, measured by market value. Now it’s ten percent. In addition, the most advanced chips must be made on European soil, whereby chip manufacturers from outside the EU are also considered. Legislation that should make all this possible is called the European Chips Act.

After the corona crisis, there were shortages of semiconductors in many sectors, which led to production problems in the automotive industry, for example. Most semiconductors have to import from European countries. “This creates a level of dependency that we cannot afford,” von der Leyen said in her speech to the World Economic Forum.

Rules for state aid to the chip sector stipulate that governments are currently allowed to contribute mainly to research by chip companies. Adjusting those rules should ensure that the Member States may also finance innovative production methods. However, von der Leyen emphasized that the new state aid rules are subject to ‘strict conditions’.