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Semiconductor manufacturers must keep production in Japan 10 years to qualify for subsidies

Friday, January 14, 2022

Tokyo is planning to require semiconductor manufacturers to keep production in the country for around 10 years to qualify for subsidies designed to attract more chipmakers to Japan.

The Japanese government is providing monetary support to chipmakers that plan to build chip facilities in the country, according to Nikkei. Taiwan Semiconductor Manufacturing Co. (TSMC) is expected to be the first company to receive the subsidy with its planned fab in Kumamoto Prefecture.

In December, the Japanese parliament passed regulations on the chip subsidies, which are scheduled to go into effect as soon as March, Nikkei reported. A total of US$5.2 billion (NT$144 billion) was budgeted to help semiconductor manufacturers, per the report.

Around US$3.49 billion (NT$97 billion) is slated to go toward TSMC’s Kumamoto plant, while the remainder will go to other chip projects under consideration, Nikkei said.

The government is expected to begin looking for public comment on specific rules related to the subsidy this month, which will be outlined in a ruling by the Ministry of Economy, Trade and Industry (METI), according to the report. Additional proposed requirements include ramping up output during shortages, protecting key technologies, and ongoing investments at the subsidized facilities.

In order to qualify for the subsidy, companies must submit plans for new plants to the METI for approval, said Nikkei. If chipmakers deviate from the originally approved plans, the subsidies must be returned.

To build the new TSMC facility, the Taiwanese chipmaker and Sony Semiconductor Solutions Corporation (SSS) will set up a joint-venture called Japan Advanced Manufacturing (JASM). The plant will produce 22 and 28-nanometer chips used in microcontrollers and image sensors.

Construction is slated to begin sometime this year, with production expected to start by the end of 2024. The fab should create around 1,500 jobs and will have a monthly capacity of 45,000 12-inch wafers.

By: DocMemory
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