CHIPS Act

President Trump recently issued two separate Executive Orders (EOs) that will have implications for how federal agencies seek to promote the administration’s goal of attracting domestic and foreign investment to industrial projects in the United States, with particular implications for the semiconductor and critical minerals industries. 

  1. An EO on March 31st establishes an “Investment Accelerator” office within the Department of Commerce that will be responsible for overseeing the implementation of the CHIPS Program—including the negotiation of agreements under the CHIPS Act.  This office will also provide technical and regulatory support for investors, and seek to facilitate research collaborations between private industry and national labs. 
  2. An earlier EO issued on March 20th seeks to mobilize federal lending and leasing authorities at the Department of Defense (DoD), the U.S. International Development Finance Corporation (DFC), and other federal agencies to support the development of domestic critical mineral projects.  Per an accompanying fact sheet, the White House is taking a broad interpretation of covered minerals under this March 20th Order and will seek to include materials such as coal. 

Both EOs are notable efforts by the White House to align federal spending and financial assistance programs with the Trump Administration’s priorities, which have variously included calls to promote self-sufficiency in critical materials and promoting “energy independence” and “energy dominance.”  These efforts come against a backdrop under which the Administration is also pursuing the use of tariffs to promote U.S. manufacturing, and taking steps to review and in some cases modify or terminate infrastructure or energy-related grants from the Biden-era.  More details are provided below.  Continue Reading Trump Administration Issues Executive Orders that Seek to Shape CHIPS Program and Promote Domestic Mineral Production

On March 21, 2023, the Department of Commerce (“Commerce”) published a Notice of Proposed Rulemaking (the “Commerce Proposed Rule”) to implement certain provisions of the CHIPS and Science Act of 2022 (“CHIPS Act”) that place restrictions on certain activities of businesses receiving federal funding pursuant to the CHIPS Act (“Commerce Guardrails”).  On the same day, the Department of the Treasury (“Treasury”) also published a Notice of Proposed Rulemaking (together with the Commerce Proposed Rule, the “Proposed Rules”) to implement the Advanced Manufacturing Investment Credit (“ITC”), including its own restrictions on certain activities that, in broad strokes, parallel the Commerce Guardrails (together with Commerce Guardrails, “CHIPS Guardrails”) (Covington alert).  Continue Reading National Security Update – Departments of Commerce and Treasury Release Notice of Proposed Rulemaking Regarding CHIPS “Guardrails”

On August 25, 2022, President Biden announced a new Executive Order (“EO”) addressing the Implementation of the CHIPS Act of 2022 (“CHIPS Act”).  The CHIPS Act was signed by President Biden on August 9, 2022, and, among other things, authorizes $39 billion in funding for new projects to establish semiconductor production facilities within the United States.  The new EO identifies the Administration’s implementation priorities for this CHIPS Act funding and creates the CHIPS Implementation Steering Council to aid with the rollout of administrative guidance.  In connection with the EO, the Department of Commerce launched CHIPS.gov, which is intended to be a centralized resource for potential applicants of CHIPS funding.  The EO and new website reflect the Administration’s intent to swiftly implement the CHIPS Act and increase the domestic production of semiconductors. Continue Reading Biden Administration Announces Priorities for the Implementation of the CHIPS Act of 2022