"CHIPS is fundamentally a national security initiative. That's why the law included guardrails to protect our national security," Commerce Secretary Gina Raimondo posted on Twitter. "Today, we're building on them to ensure malign actors don’t have access to cutting-edge technology that can be used against America and our allies."
According to an advance document on chips.gov, firms that receive grants under the CHIPS and Science Act would be barred from expanding output by 5% for advanced chips and by 10% for older technology overseas. Measures would also include a $100,000 cap on investing in capacity for advanced chips, meaning those more sophisticated than 28 nanometers.
These new restrictions, which would be in place for 10 years, target industry leaders such as Taiwan Semiconductor Manufacturing, Samsung Electronics, and Intel, all of which have operations in China. Federal grant recipients would still be able to upgrade technology at their existing facilities if they secure the necessary export control licenses.
Under the proposed rules, they would be banned from conducting joint research with or licensing technology to foreign entities of concern.
A public consultation will run for 60 days, with the regulations finalized this year.